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RICS APC > Ethics, rules of conduct and professionalism > Flashcards

Ethics, rules of conduct and professionalism Flashcards

1
Q

RICS

A

Royal Institution of Chartered Surveyors

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2
Q

Date founded

A

1868

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3
Q

Current President

A

Ann Gray FRICS

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4
Q

CEO

A

Richard Collins

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5
Q

President Elect

A

Ann Gray FRICS

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6
Q

Senior Vice President

A

Tina Paillet

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7
Q

New Rules of Conduct

A

Effective from 2nd February 2022

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8
Q

What are some of the aims highlighted within the RICS Business Plan for 2021-22?

A
  • Continue to support the profession as economies recover from Covid-19 and seek to minimise any increases in the cost of subscription levels.
  • Utilise any surplus in cash generation to pay back furlough monies received via the UK government’s Coronavirus Job Retention Scheme.
  • Maintain and increase demand for RICS qualifications with a primary goal to ensure RICS qualifications remain relevant for future generations and that increased numbers of members use RICS to meet their knowledge and training needs.
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9
Q

The New Rules of Conduct replace:

A
  • Rules of Conduct for Members
  • Rules of Conduct for Firms
  • Global Professional and Ethical Standards
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10
Q

What are the New Rules of Conduct?

A

Rule 1 (Honesty & Integrity) - Members and firms must be honest, act with integrity and comply with their professional obligations, including obligations to RICS.

Rule 2 (Professional Competence & Expertise) - Members and firms must maintain their professional competence and ensure that services are provided by competent individuals who have the necessary expertise.

Rule 3 - Members and firms must provide good-quality and diligent service.

Rule 4 (Respect, Diversity & Inclusion) - Members and firms must treat others with respect and encourage diversity and inclusion.

Rule 5 (Take responsibility and act in public interest) - Members and firms must act in the public interest, take responsibility for their actions and act to prevent harm and maintain public confidence in their profession.

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11
Q

Why did the previous Rules of Conduct change?

A
  • The previous rules has been in place since 2007 (Following research and consultation with RICS Members, Firms and Members of the public, the majority voted in favour of replacing the existing Rules of Conduct and separate Global Professional and Ethical Standards).
  • Simpler structure - to provide a single document to enable greater clarity for RICS members and firms.
  • Clear examples - worked examples to illustrate how members and firms are expected to comply with each of the Rules.
  • Focusing on respect, diversity and inclusion - aiming to tackle issues such as modern slavery, respect and curtesy.
  • Understanding evolving technology
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12
Q

Appendix A of the New Rules of Conduct

A

Contains the professional obligations of Members and Firms

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13
Q

What are the professional obligations of members?

A
  1. Members must comply with the CPD requirements set by the RICS which requires 20 hours of CPD for each calendar year, 10 hours of which must be formal CPD.
  2. Members must cooperate with RICS.
  3. Members must promptly provide all information reasonably requested by the Standards and Regulation Board, or those exercising delegated authority on its behalf.
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14
Q

What are the offences of the Bribery Act?

A
  1. Bribing.
  2. Receiving a bribe.
  3. Bribery of a foreign public official.
  4. Failing to prevent bribery.
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15
Q

What companies does the Bribery Act apply to?

A

all UK Entities including associated Persons for example sub-consultants and external advisors.

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16
Q

What procedures can companies put in place to prevent bribery on their behalf?

A

6 principles of prevention:-

  1. Proportionate Procedures.
  2. Top Level Commitment.
  3. Risk Assessments.
  4. Due Diligence.
  5. Communication.
  6. Monitoring & Review.
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17
Q

Under the Bribery Act, under what circumstances is a facilitation payment permitted?

A

The only circumstance in which it is OK to make a facilitation payment is when you are under duress.

E.g.

  • if there is a real and present risk or danger to “life, limb or liberty”.
  • if you or your companions are under immediate physical threat.
  • safety first - make the payment and report the matter immediately (to a manager or ethics complaints manager).
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18
Q

Are you aware of any RICS Guidance notes on Covid-19?

A

RICS ‘Covid-19 Guide to Surveying Services’

Guidance notes to work safely and in line with government guidelines through the pandemic.

Guidance on:

  • Physical Inspections for Residential Properties.
  • Physical Inspections for Non-domestic Properties.
  • Reopening of the Housing Market.
  • Reopening of Commercial Buildings.
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19
Q

Royal Charter

A

Granted 1881.

Obliges RICS to act for the public advantage in surveying services.

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20
Q

5 benefits of becoming an RICS member

A
  1. Status of organisation internationally, providing client confidence.
  2. Recognition that you’re promoting professional excellence.
  3. Market advantage as status provides competitive advantage.
  4. Better knowledge and professionalism due to adherence to standards and guidance.
  5. Access to strong network of professionals.
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21
Q

Role of RICS

A
  1. Maintain highest standards of education and training
  2. Protect consumers through strict regulation of professional standards
  3. Leading source of information and professional advice in surveying
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22
Q

Benefits of regulation for firms

A
  1. Confidence (as firms are monitored by RICS)
  2. Professionalism
  3. Security (as need to have PII cover/ CHP etc)
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23
Q

What is ethical decision tree?

A

Framework of questions which members should ask themselves when facing a situation in which they are asked to act in a potentially unethical manner or situation

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24
Q

Steps on ethical decision tree

A

Do you have sufficient facts?

Are you acting in line with RICS Rules of Conduct and ethical standards?

Would you be happy for your actions to be published in the press?

25
Q

Requirements to register as an RICS regulated firm

A
  1. Providing surveying services to public.
  2. Firm operating in the UK.
  3. At least 50% of principals are RICS memebers.
26
Q

Responsible Principal

A

Someone elected within a firm who is responsible for ensuring the firm complies with its regulatory and statutory obligations of the RICS

RICS ‘Rules for the regulation of firms’, 2019 (effective from 1st April 2020)

27
Q

Information required for registration (& annual return)

A
  1. Type of business and staffing details
  2. Statutory related activities
  3. Nature of clients
  4. Complaints handing procedure and records
  5. PII details
  6. Whether the firm holds client money
28
Q

Process for setting up an RICS regulated firm

A

RICS COMPLIANCE
Complete RICS Firm Detail Form
Appoint a Responsible Principal
Register with RICS for regulation of the firm by the Regulatory Board
Arrange PII cover and CHP and send details to RICS
Register for RICS Valuer Registration Scheme (VRS)
Obtain logo kit (Use of Designations rule)
Log CPD
Complete RICS Annual Return at the end of each year

STATUTORY COMPLIANCE
Adhering to legislation e.g. Equality Act / Estate Agents Act / Bribery Act
Appoint a money laundering officer

29
Q

Closing a practice

A
  1. Inform the RICS.
  2. Inform clients and arrange hand over to a new firm.
  3. Transfer money back to clients.
  4. Keep a copy of the client folders and records for a min of 6 years.
  5. Procure PII run-off cover for a min of 6 years from the expiry of the policy in force at the time.
30
Q

Professional Indemnity Insurance

A

Minimum required PII based on turnover of firm (based on projected turnover if new business).

£100,000 or less = £250,000

£100,001 to £200,000 = £500,000

£200,001 and above = £1,000,000

Maximum level of uninsured excess is based on firm turnover.

£10,000,000 or less = the greater of 2.5% of the sum insured, or £10,000

£10,000,001+ = No limit set

31
Q

Types of PII cover

A
  1. Run-off cover.
  2. Assign risk pool.
  3. Full civil liability (preferred by RICS)
32
Q

Run-off cover

A

Need min. 6 years PII cover following cease of trading (RICS recommends longer as claims can be made up to 15 years after work is undertaken).

33
Q

Assign risk pool

A

Scheme by RICS providing temporary PII for firms who are unable to arrange cover.

Eg. if firm needs to renew cover and still had claims to settle with old insurer.

34
Q

PII policies made on a…

A

… claim by claim basis

i.e doesn’t matter when negligence occurs, use current insurer when claim is made

35
Q

Rules for holding clients money

A
  1. Client accounts must be kept separately.
  2. ‘Client’ must be named on account.
  3. Client must be able to have access to their money on demand.
  4. Annual audit by certified accountant.
36
Q

Money Laundering

A

Money Laundering and Terrorist Financing (Amendment) Regulation 2019

Concealing origins of illegally obtained money and using as legitimate assets.

37
Q

Types of DD for Money Laundering

A
  1. Customer Due Diligence - Identify client and verify identity (i.e usual AML checks).
  2. Enhanced Due Diligence - Additional procedures needed when dealing with politically exposed person or person from a high risk third country.
  3. Simplified Due Diligence.
38
Q

Politically Exposed Person

A

Someone who has been entrusted with a prominent public function and therefore is at higher risk of bribery due to their influence.

39
Q

Future of RICS

A
  • The Bichard Review was undertaken in June 2022 following the Independent Review by Alison Levitt QC in 2021.
  • 7 key recommendations were made.
  • RICS adopted all of the Bichard recommendations.
40
Q

Bichard Review recommendations

A
  1. Increased focus on diversity and inclusion across the profession and within RICS governance.
    2.A new simplified, clear, accountable governing structure.
  2. Showing greater leadership on matters such as sustainability and climate change.
  3. A renewed and increased focus on the public interest remit of RICS, amending the Royal Charter and creating a public interest panel to advise Governing Council.
41
Q

RICS Structure

A
  • Governing Council
  • Regulatory Board
  • Management Board
  • Presidential Team
  • Executive Team
42
Q

When did the Bribery Act 2010 come into force?

A

1 July 2011

43
Q

What are bye-laws?

A

A list of laws applied internally using powers granted by the Royal Charter.

44
Q

Who is the chair of RICS Matrics?

A

Theo Till

45
Q

What different types of professional guidance is published by the RICS?

A
  1. International Standards - Mandatory
    2 Professional Statements - Mandatory
  2. Practice Statements - Mandatory
  3. Codes of Practice - Mandatory or recommended good practice (will be confirmed in the document itself)
  4. Guidance Notes - Voluntary
46
Q

Examples of International Standards, Professional Statements, Practice Statements, Codes of Practice and Guidance Notes.

A
  1. International Standards - RICS Valuation - Global Standards, 2021
  2. Professional Statements - Property Measurement, 2018
  3. Practice Statements - Surveyors Acting as Expert Witnesses, 2014
  4. Codes of Practice - Code of Measuring Practice, 2015
  5. Guidance Notes - Comparable Evidence in Real Estate Valuation, 2019
47
Q

What are the RICS’ principles for better regulation?

A

As determined by the Better Regulation Commission, a division of the UK Cabinet Office:

  1. Proportionality
  2. Accountability
  3. Consistency
  4. Targeting
  5. Transparency
48
Q

What is a bribe?

A

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.

49
Q

What is corruption?

A

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

50
Q

What is money laundering?

A

Concealing the source of the proceeds of criminal activity to disguise their illegal origin.

51
Q

What is terrorist financing?

A

The solicitation, collection or provision of funds with the intention that they may be used to support terrorist acts or organisations.

52
Q

Who is a nominated officer?

A

Person responsible to ensure anti-money laundering policies are in place, are compiled with, and any risks or suspicions are acted on.

53
Q

In how many countries does RICS operate in?

A

146

54
Q

How many RICS members are there?

A

140,000

55
Q

What are the different types of membership?

A
  1. MRICS
  2. AssocRICS
  3. FRICS
  4. Student
56
Q

How is the RICS implementing the Bichard Review recommendations?

A
  1. Governing Council will implement a new composition of Council to better reflect the geographic location and disciplines of members
  2. As many as possible Council seats will be directly elected by members
  3. Election process will be reviewed and simplified to encourage a broad and diverse range of applicants from across the profession.
  4. Launched MyRICS Community - platform for members to network
  5. Memorandum of Understanding Action Plan to drive the creation of a more diverse, equitable and inclusive sector (focuses on anonymous demographic data collection to understand the current shape of profession and identify priority areas for improvement)
  6. Change to the RICS purpose to provide more clarity as to the role of the RICS
  7. Creation of a public interest community
57
Q

Factors to consider when assessing risk of a potential client?

A
  1. Presence of a PEP;
  2. Excessively complex ownership structure;
  3. Negative media reports;
  4. Business sector; (mining & drilling are often located in countries with high risks of corruption or political instability or casinos, restaurants and bars)
  5. Financing methods;
  6. Geographic location
58
Q

Definition of Ultimate Beneficial Owner (UBO)?

A

Any individual who owns or controls more than 25% of the shares, voting rights or exercises control over an organisation.

E.g. shareholder, company officer, partners, trustees.

RICS APC (18 decks)

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