Ethics, Rules of Conduct and professionalism

Question 1

What are the 5 Ethical Standards?

Answer 1

1. Act with integrity – being trustworthy in all you do, boing open and transparent, respecting confidential information of your client and potential clients
2. Always provide a high standard of services – act within your scope of competence, be transparent about fees and other costs,
3. Act in a way that promotes trust in the profession – its about how you behave in both private and professional life, fulfilling your obligations
4. Treat others with respect
5. Take a responsibility

Question 2

What is Royal Charter?

Answer 2

A Royal Charter is an instrument of incorporation, granted by The Queen, which confers independent legal personality on an organisation and defines its objectives, constitution and powers to govern its own affairs.

Question 3

What RICS stands for?

Answer 3

The Royal Institution of Chartered Surveyors (RICS) is a professional body promoting and enforcing the highest international standards in the valuation, management and development of land, real estate, construction and infrastructure.

Question 4

What is a motto of RICS?

Answer 4

Est modus in rebus; (“There is measure in all things”)

Question 5

What is APC?

Answer 5

Assessment of Professional Competence
The Assessment of Professional Competence (APC) can be completed with or without structured training depending on your experience.
• Structured training – develop your skills over 12 or 24 months of structured training before assessment.
• Preliminary review – with 5 years of experience, you can go to final assessment following a review of your submissions.

Question 6

What is Lionheart?

Answer 6

• LionHeart is an independent charity run by RICS professionals, for RICS professionals. Through a volunteer network, this benevolent fund offers confidential advice, information and other support to past and present members of the organisation who, for whatever reason, find themselves in difficulty.
• The aim of LionHeart is simple: to be there for RICS professionals whenever life throws them a curve ball, from APC candidates right through to retirement.
• The services we provide range from financial support, health and wellbeing packages, free professional counselling, work-related support and legal advice, and help if you or one of your loved ones become seriously ill.
• We want to help as many people as we can, no matter what their circumstances. Many of our services are there to also help RICS professionals outside of the UK. We don’t provide a ‘one size fits all’ service, but work with people to find out about all of their needs so we can provide a responsive and sensitive package of support.

Question 7

What are RICS 5 principles of better regulation?

Answer 7

• Proportionality
• Accountability
• Consistency
• Targeting
• Transparency

Question 8

Can you give me an overview of the RICS governance structure?

Answer 8

The Privy Council is an advisory body to the Monarch; its members are known as Privy Counsellors.

Governing Council is our highest governing body, setting our global strategy and ensuring RICS fulfils its Royal Charter obligations. It provides strategic oversight on requirements for entry into the profession, and the setting and enforcement of professional standards so that we continue to deliver confidence in the built and natural environment. It also shapes our priorities as an influential thought leader, and provides high-level assurance on our operations as a sustainable business and professional body.

Management Board -The main purpose of the Management Board is to direct RICS affairs under delegated authority from Governing Council. The Board is comprised of non-members (independent), members of RICS, and RICS Executives.

The Standards and Regulation Board has exclusive responsibility for strategy, policy and operational oversight of the standards, entry and admission to the profession (through RICS’ education and qualification standards), and regulatory functions of RICS.

The Audit Committee operates independently of Governing Council, the Management Board and the Standards and Regulation Board. Its remit extends across the whole organisation, including the regulatory function. Each year it reports to Governing Council at its oversight meeting on how it has discharged its duties. The Committee is comprised of independent non-members and members of RICS.

Nomination Committee
Presidential Nominations Committee
Regulatory Tribunal

Question 9

What is a bye law?

Answer 9

by-law (bye-law, by(e)law, by(e) law) is a rule or law established by an organization or community to regulate itself, as allowed or provided for by some higher authority.

Question 10

What are rules of conduct for members?

Answer 10

Part 1 General
1. Interpretation - In these Rules, unless the context otherwise requires, ‘Member’ means
a Chartered Member, non-Chartered Member, Honorary Member or a
member of the attached classes.
2. Communication – method of communications (email, by post, in person etc.)
Part 2 Personal and Professional Standards
3. Ethical behaviours - Members shall at all times act with integrity and avoid conflicts of interest and avoid any actions or situations that are inconsistent with their professional obligations.
4. Competence - Members shall carry out their professional work with due skill, care and
diligence and with proper regard for the technical standards expected of them.
5. Service - Members shall carry out their professional work in a timely manner and
with proper regard for standards of service and customer care expected of them.
6. Continuing Professional Development (CPD) - Members shall comply with RICS’ requirements in respect of continuing professional development.
7. Solvency - Members shall ensure that their personal and professional finances are
managed appropriately.
8. Information to RICS - Members shall submit in a timely manner such information, and in such form, as the Standards and Regulation Board may reasonably require.
9. Cooperation - Members shall cooperate fully with RICS staff and any person appointed
by the Standards and Regulation Board.

Question 11

What are rules of conduct for firms

Answer 11

Part I – General
1. Interpretation – ‘Providing a surveying service to the public’, ‘Contact Officer’, ‘Firm’
2. Communication –
Part II – Conduct of Business
3. Professional behaviour - A Firm shall at all times act with integrity and avoid conflicts of interest and avoid any actions or situations that are inconsistent with its professional obligations.
4. Competence - A Firm shall carry out its professional work with due skill, care and diligence and with proper regard for the technical standards expected of it.
5. Service - A Firm shall carry out its professional work with expedition and with proper regard for standards of service and customer care expected of it.
6. Training and Continuing Professional Development (CPD) - A Firm shall have in place the necessary procedures to ensure that all its staff are properly trained and competent to do their work.
7. Complaints handling - A Firm shall operate a complaints-handling procedure and maintain a complaints log. The complaints-handling procedure must include an Alternative Dispute Resolution (ADR) mechanism that is approved by the Standards and Regulation Board.
8. Clients’ money - A Firm shall preserve the security of clients’ money entrusted to its care in the course of its practice or business.
9. Indemnity - A firm shall ensure that all previous and current professional work is covered by adequate and appropriate indemnity cover which meets standards approved by the Standards and Regulation Board.

Part III – Firm Administration
10. Advertising - A Firm shall promote its professional services only in a truthful and responsible manner.
11. Solvency - A Firm shall ensure that its finances are managed appropriately.
12. Arrangements to cover the incapacity or death of a sole practitioner - A Firm which has a sole principal (i.e. a sole practitioner or a sole director in a corporate practice) shall have in place appropriate arrangements in the event of that sole principal’s death or incapacity or other extended absences.
13. Use of designations - A Firm registered for regulation must display on its business literature, in accordance with the Standards and Regulation Board’s published policy on designations, a designation to denote that it is regulated by RICS.
14. Information to RICS - A Firm shall submit in a timely manner such information about its activities, and in such form, as the Standards and Regulation Board may reasonably require.
15. Cooperation - A Firm shall cooperate fully with RICS staff and any person appointed by
the Standards and Regulation Board.

Question 12

What is a conflict of interest?

Answer 12

A conflict of interest is a situation in which a person or organization is involved in multiple interests, financial or otherwise, and serving one interest could involve working against another.

Question 13

What types of conflict of interest are you aware of?

Answer 13

A. Party Conflict - a situation in which the duty of an RICS member (working independently or within a non-regulated firm or within a regulated firm) or a regulated firm to act in the interests of a client or other party in a professional assignment conflicts with a duty owed to another client or party in relation to the same or a related professional assignment (a ‘Party Conflict’)
B. Own Interest Conflict - a situation in which the duty of an RICS member (working independently or within a non-regulated firm or within a regulated firm) or a regulated firm to act in the interests of a client in a professional assignment conflicts with the interests of that same RICS member/ firm (or in the case of a regulated firm, the interests of any of the individuals within that regulated firm who are involved directly or indirectly in that or any related professional assignment) (an ‘Own Interest Conflict’)
C. Confidential Information Conflict - a conflict between the duty of an RICS member (working independently or within a non-regulated firm or within a regulated firm) under paragraph 2.2 to provide material information to one client, and the duty of that RICS member (working independently or within a non-regulated firm) or of a regulated firm under paragraph 2.1 to another client to keep that same information confidential (a ‘Confidential Information Conflict’).

Question 14

What is information barrier?

Answer 14

‘Information Barrier’ means: the physical and/or electronic separation of individuals (or groups of individuals) within the same firm that prevents confidential information passing between them.

Question 15

What is informed consent?

Answer 15

‘Informed Consent’ means: consent given willingly by a party who may be affected by a Conflict of Interest, that party having demonstrated to the RICS member working independently or within a non-regulated firm or regulated firm concerned that the party understands:
(a) that there is a Conflict of Interest or a significant risk of a Conflict of Interest and
(b) the facts known by the RICS member (working independently or within a non-regulated firm or within a regulated firm) or the regulated firm that are material to the Conflict of Interest and
(c) what that Conflict of Interest is or may be and
(d) that a Conflict of Interest may affect the ability of the RICS member (working independently or within a nonregulated firm or within a regulated firm) or a regulated
firm to advise or act fully in the interests of a client.

Question 16

What is Bribery?

Answer 16

The offer, promise, giving, demanding or acceptance of an advantage as an inducement for an action that is illegal, unethical or a breach of trust.

Question 17

What is Corruptions?

Answer 17

The misuse of public office or power for private gain; or misuse of private power in relation to business practice and performance.

Question 18

What is Terrorist financing?

Answer 18

The solicitation, collection or provision of funds with the intention that they may be used to support terrorist acts or organisations. Funds appropriated directly or indirectly for this purpose constitute terrorist funding.

Question 19

What are the Mandatory Requirements for RICS regulated Firm with regards to Bribery?

Answer 19

• Not offer or accept, directly or indirectly, anything that could constitute a bribe
• Ensure that they have adequate knowledge of bribery and corruption to be able to comply with the requirements of this professional statement.
• Report any activity they are aware of that breaches applicable anti-bribery and corruption laws to the relevant authorities (as specified in local legislation); where there is no local legislation the activity should be recorded and, if possible, reported to a senior manager.

Question 20

What are the Mandatory Requirements for RICS members in terms of Bribery?

Answer 20

• Not offer or accept, directly or indirectly, anything that could constitute a bribe
• Ensure that they have adequate knowledge of bribery and corruption to be able to comply with the requirements of this professional statement.

• Report any activity they are aware of that breaches applicable anti-bribery and corruption laws to the relevant authorities (as specified in local legislation); where there is no local legislation the activity should be recorded and, if possible, reported to a senior manager.

Question 21

Which firms are required to register for regulation by the RICS?

Answer 21

A Firm is required to register for regulation by RICS if:
• the Firm provides surveying services to the public;
• the Firm is operating in Regulated Area A;
• at least 50% of the Firm’s Principals are RICS Members.
RICS Members who are also Principals of a Firm that is required to register under Rule 3 must take all reasonable steps within their power to ensure that an appropriate application to register for regulation by RICS is made on behalf of the Firm.

Question 22

Which firms are eligible to register with RICS?

Answer 22

A Firm is eligible to register for regulation by RICS if:
• the Firm provides surveying services to the public; and
• at least 25% of the Firm’s Principals are RICS Members.

Question 23

What Complain Holding procedure should include?

Answer 23

An effective CHP should:
 be fit for purpose – it should reflect the size and structure of the business
 made available to all staff – a CHP is intended to provide clarity and consistency to staff and clients
 be understood by all staff – keep records of staff training
 readily be shared with complainants or potential complainants – supplying them with a copy should be routine
 be regularly reviewed at a senior level – record evidence of review, to include reviewer details and review date
 be agreed with PII brokers/provider(s) – the CHP should reflect processes that do not compromise PII cover and
 provide details of access to independent redress if the firm cannot resolve the complaint.

Question 24

How many professional groups of the RICS are there?

Answer 24

1. Building Control
2. Building Surveying
3. Commercial Property
4. Dispute Resolution
5. Environment and Resources
6. Facilities Management
7. Geomatics
8. Machinery and Business Assets
9. Management Consultancy
10. Minerals and Waste Management
11. Our Mental Health
12. Planning and Development
13. Personal Property/Arts and Antiques
14. Project Management
15. Quantity Surveying and Construction
16. Residential Property
17. Rural
18. Valuation

Question 25

What are CDP requirements for members?

Answer 25

• Members must undertake a minimum of 20 hours of CPD activity each calendar year, by 31 December. Of the 20 hours at least 10 hours must be formal CPD. See section 2 “Requirements – Formal and Informal CPD Learning” for further information and guidance.
• Members are also required to undertake learning in relation to the RICS Global Professional and Ethical Standards at least once every three years. See section 3 “Requirements – Global Professional and Ethical Standards” for further information and guidance.
• Members must record online their required CPD activities either on the RICS online system via the RICS website or using one of the RICS CPD mobile Apps. This must be done by 31 January of the year after the CPD year. See section 4 “Requirements - Recording CPD” and Appendix 1 “Recording CPD using the Online System” for further information and guidance.

Question 26

What is professional indemnity insurance?

Answer 26

Professional indemnity insurance, often referred to as professional liability insurance or PI insurance, covers legal costs and expenses incurred in your defence, as well as any damages or costs that may be awarded, if you are alleged to have provided inadequate advice, services or designs that cause your client.
The purposes of having professional indemnity insurance are to:
• ensure that if the firm faces a claim, it is protected from financial loss that it cannot meet from its own resources;
• protect the insured member or firm against the consequences of its liability to pay damages to third parties for breaches of professional duty that it commits through its professional activities; and
• ensure that the firm’s clients do not suffer financial loss, which the firm cannot meet.
Firms will adopt different ways of meeting these aims according to their size, the risks attached to the type of work they carry out and their resources.

Question 27

What is run off cover?

Answer 27

• ‘Run off’ is a form of professional indemnity insurance which covers the historic liabilities of a business after it ceases to trade.
• Run off cover is a professional indemnity insurance policy which comes into effect when a business stops trading and any claims made under it will relate to work carried out before trading stopped.

Question 28

What insurances would you need if you were starting up your own firm?

Answer 28

The most popular types of business insurance and the reasons why business owners may need them.
• Public liability insurance
Public liability insurance is a key consideration if your business comes into contact with members of the public, whether that’s at your premises or elsewhere. It can protect you against compensation claims for injury or damage made by clients, customers, suppliers, or other third parties. Most shops, restaurants, hairdressers, builders, and tradesmen take out this insurance. Check your client contracts to see if a particular level of public liability insurance is required.
• Professional indemnity insurance
Professional indemnity insurance is important if your business gives advice or offers a professional service to other businesses, or if you deal with client data or intellectual property. If you make a mistake in your work and your client loses money and sues you, your professional indemnity insurance can cover the compensation claims and legal costs. Some professional bodies and regulators require their members to have this insurance, including bodies for surveyors, accountants, and architects.
• Employers’ liability insurance
If your business employs staff, you’re probably legally required to have an employers’ liability insurance policy. This covers compensation claims made by a member of staff because they’ve suffered injury, illness or damage as a result of their work. Certain companies are exempt from the legislation, including some businesses that only employ close family members. To see if you’re exempt, check the Health and Safety Executive (HSE) guidelines or seek advice.
• Business buildings insurance
Whether you work from home or have separate business premises such as a shop, office, or pub, business buildings insurance should be a priority. If you rent the premises, make sure to check with your landlord to see what’s already covered.
• Business contents insurance
You can also protect the contents of your business premises, your business equipment and tools. If these are damaged, destroyed, lost or stolen, this cover will pay the cost of replacements or repairs.
• Stock insurance
If you hold any stock, whether on your premises or in storage, stock insurance will cover the cost of replacing it if it’s damaged, destroyed or stolen.
• Product liability insurance
Product liability insurance protects you should a customer of yours suffer damage as a result of a faulty product you provide. You may be held liable for damage even if you didn’t manufacture the product.
• Personal accident insurance
Personal accident insurance covers serious injury or death caused by an accident. It can pay out for lost income, medical costs and hospitalisation, up to the limit of the policy. The maximum amount is £10,000 for an injury and £20,000 for death.

Question 29

What are the requirements regarding PI by the RICS?

Answer 29

• Must be made on an ‘each and every’ claim basis
• Gives min wording, As a minimum, you should ensure that your policy wording is written on a full civil liability basis
• Sets out minimum levels of indemnity
• Sets out maximum levels of uninsured excess
• Run off cover must be in place for at least 6 years
• Should include cover for past and present employees, directors and partners
• Fully retroactive- work on a claims made basis

Question 30

What does claims made basis means?

Answer 30

This means that the policy covers claims that are first made against the insured during the period of insurance regardless of when the negligent act occurred. If the retroactive date of the policy is stated as ‘none’ then the policy is fully retroactive and all former work carried out by the firm will be covered.

Question 31

What should you do if you faced with a conflict of interest?

Answer 31

Openness
• Transparency
• You should offer to stand down
• If they keep you on you propose how you manage the conflict of interest.
• You must not accept of a potential conflict cannot be managed or a solution found with agreement by all parties then you must not accept the instruction.

Question 32

How do you conduct a fee proposal?

Answer 32

• Resource schedule gives a cost. Expressed as percentage of contract sum, hourly rate, lump sum.

Question 33

What are the main elements included in a fee proposal?

Answer 33

• Terms and conditions
• Scope of services
• Exclusions
• Assumptions – e.g. programme

Question 34

What are the liquidated damages and how are they calculated?

Answer 34

Liquidated damages are pre-determined damages set at the time that a contract is entered into, based on a calculation of the actual loss the client is likely to incur if the contractor fails to meet the completion date. They might include; rent on temporary accommodation, removal costs, extra running costs, and so on. They are generally set as a fixed daily or weekly sum, although there may be a more complicated formulae where the works are phased, where may be partial possession and so on.
Calculations might include, amongst other things:
• Loss of rent
• Loss of income
• Fees
• Storage costs.
• Rental costs.
• Fees and fines imposed by third parties.
• Finance costs.

Question 35

If you were to set up your own company, what would you need to do to set this up?

Answer 35

n line with government advice on how to set up limited company, I would:
• check what type of company is right for me (LTD, partnership)
• choose a name
• choose directors and company secretary
• Decide who the shareholder or guarantees are
• Prepare documents agreeing how to run your company (memorandum of association and articles of association)
• check what records you will need to keep
• Register your company – register an official address and choose a SIC code – registration with Companies House and register for Corporation tax with HM Revenue and Customs (HMRC)
• register a company with RICS