Ethics, Rules of Conduct and professionalism (L1-3) Flashcards
1
Q
Tell me what you understand about conflicts of interest?
A
- A conflict of interest is where someone in a position of trust has competing personal or professional interests making it difficult for them to fulfil their duties impartially
- Chartered Surveyors have an obligation to make clients aware and if necessary, decline work where a conflict occurs
2
Q
What types of conflicts of interest do the RICS define?
A
- Party Conflict
- Own Interest Conflict
- Confidential Information Conflict
3
Q
What is a Party Conflict?
A
This occurs when there is conflicting obligations to act in the best of interests of different clients or parties involved in the same or related professional assignments.
4
Q
What is a Own Interest Conflict?
A
This occurs when the obligation to act in the clients best interests conflicts with the members or firms own interest.
5
Q
What is a Confidential Information Conflict?
A
This occurs when a members or firms obligation to provide information to one client conflicts with their obligation to keep that same information confidential for another client.
6
Q
How could the conflict of interest be managed internally if two separate departments were working for the same client?
A
- Put procedures in place to ensure exclusivity of staff to avoid any cross over of information between departments
- Ensure there are separate communication lines into the client
- Provide secure office and data storage
- Set up NDA agreements with staff
- Monitor the potential conflict
7
Q
If the client was insistent that you worked for them despite an existing conflict of interest, how would you proceed?
A
- Check their understanding of reduced impartiality
- Agree working procedures to manage the conflict
- Seek a letter of instruction to continue
- Keep them updated of any risks
8
Q
What are the main principles of the Bribery Act (2010)?
A
The offences are:
- Making a bribe
- Receiving a bribe
- Bribery of a foreign public official
- Failure of a corporate entity to prevent bribery on its behalf
9
Q
What are the six principles of prevention companies should put in place under the Bribery Act (2010)?
A
- Proportionate Procedures
- Top level commitment
- Risk assessments
- Due diligence
- Communication
- Monitoring & review
10
Q
Under the Bribery Act (2010), under what circumstances is a facilitation payment permitted?
A
- The only circumstance in which it is ok to make a facilitation payment is when your are under duress
- For example, if there is real and present risk or danger to life, limb or liberty.
11
Q
What are the ethical principles that the RICS Rules of Conduct are based on?
A
- Honesty
- Integrity
- Competence
- Service
- Respect
- Responsibility
12
Q
What is the difference between RICS ethics and rules?
A
- Ethics are a set of moral values
- Rules of conduct is framework that we work to
13
Q
When did the Rules of Conduct change?
A
2nd February 2022
14
Q
Why did the previous Rules of Conduct change?
A
- Previous rules has been in place since 2007
- Majority vote to bring them into one clear framework providing a
- Simpler structure
- with Clear examples
- Focusing on respect , diversity and inclusion
- Evolving technology and
- Tackling global challenges
15
Q
What are the RICS Rules of Conduct?
A
Member and firms must:
- Rule 1 : Be honest, act with integrity and comply with their professional obligations
- Rule 2: Maintain professional competence and ensure that services are provided by competent individuals with the necessary expertise
- Rule 3: Provide good-quality and diligent services
- Rule 4: Treat others with respect and encourage diversity and inclusion
- Rule 5: Act in the public interest, take responsibility for their actions, act to prevent harm and maintain public confidence in the profession
16
Q
What is ethical procurement?
A
- Ethical procurement refers to the practice of acquiring goods, services, and works in a manner that is fair, transparent, and responsible.
- It involves considering not only the cost but also ethical implications of the procurement and its outcomes.
17
Q
When was the RICS fouded?
A
1868
18
Q
What are the professional obligations of the members?
A
Members must:
- Comply with CPD requirements (20 hours each calendar year, 10 of which must be formal)
- Cooperate with RICS
-Promptly provide all information reasonably requested by the Standards and Regulation Board
19
Q
What is the distinction between formal and non-formal CPD?
A
- All CPD must be relevant to your role or wider profession
- Formal CPD will have externally set learning outcomes and involve an assessment of learning or interaction such as formal webinars
- Non-formal CPD won’t have this such as private reading
- The CPD decision tree can help in this regard
20
Q
What procedures must you follow if you are starting up a new practice?
A
- Contact RICS for company start up pack
- Register for Regulation
- Appoint contact officer for RICS communications
- Prepare complaints handling procedure
- Abide by Rules of Conduct
- Use designation ‘Regulated by RICS’ on all practice material
21
Q
What insurances would you need if you were setting up your own firm?
A
- Professional Indemnity Insurance
- Employer’s Liability Insurance
- Public Liability Insurance
- Building Insurance for office
22
Q
What is the purpose of Professional Indemnity Insurance?
A
To provide financial cover in the event a client suffers financial loss as a result of a breach of professional duty e.g. neglect, errors or omissions.
23
Q
What are the RICS minimum levels of indemnity?
A
- Turnover up to £100k it is £250k
- Over £100k up to 200k it is £500k
- Over £200k and above it is £1m
24
Q
What does the Royal Charter mean to you?
A
- It is the mechanism in which how the RICS was formed as an organisation i.e. incorporated by Royal Charter
- The Royal Charter is controlled by governing council, and it is approved by the monarch under the guidance of privy council
- Sets out the objectives of the institution – to secure advancement and acquisition of knowledge
25
What are the 5 Rules of Conduct?
* Rule 1 – Be honest, act with integrity and comply with professional obligations including obligations to the RICS
* Rule 2 – Maintain professional competence and ensuring that services are provided by competent individuals with the necessary expertise
* Rule 3 – Provide good quality and diligent services
* Rule 4 – Treat other with respect and encourage diversity and inclusion
* Rule 5 – Act in the public interest, take responsibility for their actions, act to prevent harm and maintain public confidence in the profession
26
What are the ethical principles upon which these rules are based?
* Honesty
* Integrity
* Competence
* Service
* Respect
* Responsibility
27
What are the mandatory professional obligations for Members?
* Comply with CPD requirements (20 hours annually, 10 of which must be formal)
* Co-operate with RICS
* Promptly provide all information reasonably requested by the standards and regulations board
28
Tell me about some of the Mandatory obligations for RICS Regulated Firms?
* Publish complaints-handling procedure (which includes ADR provider approved by RICS) and maintain complaints log
* Ensure adequate PI insurance that meets the standards approved by RICS
* Firms with a sole principal must make appropriate arrangements for their professional work to continue in the event they are unable to work
* Co-operate with RICS
* Promptly provide all information reasonably requested by the standards and regulations board
* Use designation, regulated by RICS on all practice material
* Report to RICS any matter that they are required to report under the Rules for the Registration of Firms
29
What are the principles of the Anti-Bribery Laws? How does this affect your day-to-day activities?
* The offences are:
o Making a bribe
o Receiving a bribe
o Bribery of a foreign public official and
o Failure of a corporate entity to prevent bribery on its behalf
* As a QS, the Bribery Act 2010 requires a high level of ethical awareness and compliance in my day-to-day activities, particularly around
o Procurement
o Contractual negotiations and
o Financial transactions
I need to ensure I am
o Vigilant in identifying and preventing bribery activities,
o Ensure my actions are transparent and in line with the law which may involve rejecting gifts and hospitality and that suppliers are not involved in unethical behaviour
30
Once qualified, and if you were to set up your own firm regulated by the RICS, what are your obligations to achieve this?
o Contact RICS for company start-up pack
o Register for Regulation
o Appoint a contact officer for RICS communications
o Prepare a complaints handling procedure
o Abide by Rules of Conduct
o Use designation, Regulated by RICS on all practiced material
- Arrange PII cover to apporved RICS standards
31
Who does professional indemnity insurance protect?
o The consultant or firm – it provides financial cover in the event a client suffers financial loss as a result of a breach of professional duty e.g. neglect, errors or omissions
32
How do you ascertain the level of PI for your new firm?
o Using the RICS Professional Indemnity Insurance Requirements standard
o This sets out the standards of cover approved by the RICS
o The level of PI is based on annual turnover (or estimated for a new firm), these are:
o Turnover up to £100k it is £250k
o Turnover between £100k - £200k it is £500k
o Turnover over £200k it is £1m
33
What happens to PI once you stop trading?
o Usually, the PI policy will act as run-off insurance for the reminder of the policy period (this may need to be extended in line with limitation periods)
34
If you are a sole trader, what do you need to have in place should you be unable to perform your duties, say due to ill health, death or some other way you are incapacitated?
o As per firms’ obligations they should have
o Appropriate arrangements for their professional work to continue such as Run-off cover
35
Provide an example on one of your projects where you have acted with integrity?
o On the Williamsgate project
o Received a contractor’s quotation for a CE which did not include the direct fee percentage
o Even though highlighting this would increase the contractors quotation and therefore the cost
o My duty to act honestly and with integrity prevailed and
o I advised that a revised quotation should be instructed such that the contractor could correctly apply the direct fee percentage
36
You mention conflict of interests; what guidance does the RICS give in relation to the process of dealing with this?
o The Conflicts of interest professional standard provides clear rules for RICS members and regulated firms to identify and manage actual and potential conflicts of interest
o This includes:
o Not advising or representing a client were doing so would involve a CoI or a potential risk of a CoI
o Obtaining informed consent
If it is the correct thing to do and all client’s interests will be served and
o Keeping records
Of decisions made IRT accepting or proceeding with work
The obtaining of Informed Consent and
Any measures taken to avoid CoIs arising
37
Provide an example of a time when you have carried out a task that promotes trust in the profession?
o On the Williamsgate project
o Received a contractor’s quotation for a CE which did not include the direct fee percentage
o Even though highlighting this would increase the contractors quotation and therefore the cost
o My duty to act honestly and with integrity prevailed and
o I advised that a revised quotation should be instructed such that the contractor could correctly apply the direct fee percentage
o Doing so promotes trust in the profession that services are provided honestly and with integrity
38
Talk me through the steps you would take when identifying a conflict of interest in the workplace
o This will be based on the size, complexity and number of practice areas in the firm
o Identification maybe achieved through:
o Database checks
o Advisory emails to staff to enquire about any individual involvement
o Existing record searches
o Requesting staff to declare personal interests
39
What is your company’s policy on gifts and hospitality
o My employers internal control manual contains a hospitality policy which includes the giving or receiving of gifts. The policy sets out
o That gifts and hospitality are recorded on each applicable occasion whether accepted or not
o Giving or receiving of gifts of less than £10 or basic refreshments with a value of £50 pp need not be included in record
o Hospitality that is excessive or perceived as influencing decisions should not be accepted
o Regardless of foreign culture, hospitality or gifts must not be offered or accepted when dealing with Foreign Public Officials
40
What does the RICS policy state about gifts and hospitality?
o RICS members should follow these rules:
o Only offer or accept gifts and hospitality that are customary, proportionate and reasonable in terms of value and frequency
o Never offer or accept any gift or hospitality if it may improperly influence your decisions/judgement or give the appearance of doing so (e.g. consider the timing of the gift)
o Only offer or accept gifts and hospitality that you would be happy for others to know about
o Follow the policies and procedures of your employer in relation to gifts, hospitality - e.g. record in company’s gifts and hospitality register
o Report any concerns about bribery to your employer or to RICS Regulation
41
What are the rules around bribery and how is this adopted in your workplace?
o The offences are:
o Making a bribe
o Receiving a bribe
o Bribery of a foreign public official and
o Failure of a corporate entity to prevent bribery on its behalf
o My employer has procedures and policies in place such as a hospitality policy including gifts which permits only proportionate and reasonable hospitality for legitimate business purposes which applies when conducting business overseas.
o In addition, we have a United Supply Chain approach setting out standards that we expect from organisations we deal with and makes clear that we do not tolerate corruption or bribery.
42
Provide an example of how you have provided credible advice to a client in relation to the ethical principles in your day to day practices.
o On the Williamsgate project
o Received a contractor’s quotation for a CE which did not include the direct fee percentage
o Even though highlighting this would increase the contractors quotation and therefore the cost
o My duty and morals ]/ ethics to act honestly and with integrity prevailed and
o I advised that a revised quotation should be instructed such that the contractor could correctly apply the direct fee percentage
43
How does your example exclusion of fee percentage on the Williamsgate project relate to RICS Rules of Conduct?
o Members and firms have an obligation to act honestly, with integrity and comply with their professional obligations
o Highlighting the contractor had not included his fee demonstrates my ability to operate honestly and with integrity and comply with my professional obligations which under the contract require me to act as stated in the contract and more widely discharge my duties impartially
o Such behaviour also promotes trust and confidence in the profession
44
If you considered someone in your organisation was acting out with the Rules of Conduct, what would you do?
o I would remind them of the RICS rules of conduct and
o Report any concerns to my employer or to RICS Regulation
45
What are RICS members and firms obligations in relation to handling client money?
* Members and firms must ensure
o Client money is kept safe
o Client money accounts are used for appropriate purposes only and
o RICS regulated firms must have appropriate controls and procedures to safeguard client money
46
What is bribe?
To improperly influence the judgment or conduct of someone by offering money or something else of value to get that person to do something you want
47
What is the RICS?
The RICS is the worlds leading professional body specialising in land, property and construction and represents 130k qualified professionals
48
Who is the RICS CEO?
Justin Young
49
Who is the president of the RICS?
Tina Paillet
50
Who is the president elect of the RICS?
Justin Sullivan
51
Who is the senior vice president?
Nicholas Maclean
52
What is the ethics decision tree?
It is a decision-making framework to deal with ethical dilemma and provides surveyors with a series of questions to ensure that they meet ethical standards
53
What are the CPD requirements?
To record 20 hours per year 10 formal 10 informal
must be recorded by 31st January
Understanding of ethical standards must be renewed every three years
54
What is negligence
- Negligence is a ‘tort’.
- In the case of a professional, negligence is a failure
to provide services with the standard of skill and care that would be expected from a reasonable body of the professional’s peers
55
If you were winding up a company what would you need to do
Notify the RICS take out run off cover (minimum 6 years)
56
What is run-off cover?
- A form of insurance to provide cover for claims
arising after a firm or individual has ceased trading
57
What is the RICS and what does it mean to you?
- The RICS is the worlds leading professional body specialising is land, property and construction and represents 130k construction professionals.
- To me
-The RICS is the benchmark for professionalism competence and ethical conduct
58
What are the discipline procedures?
* Complaints are investigated:
o When serious enough and supported by evidence, the standards and regulations board will consider disciplinary actions
o For less serious actions Head of Regulation may impose a consent order to ensure future compliance with standards which may include
Fine
Caution
Or conditions on the membership
o For serious cases it may need to go to a disciplinary panel whom may impose a fine or expulsion
59
What is a consent order
# Accept steps to prevent it happening again
A consent order is an agreement between RICS and a member that they are liable for disciplinary action
60
Are you aware of any RICS initiatives?
* Inspire Future Surveyors
o Programme for showcasing the profession to next generation and
o Inspire young people about surveying role in shaping our world
61
What is Lion Heart?
Lion heart independent charity to support past and present RICS Professionals and families though any of lifes challenges from start to retirement
Services include:
*Financial support
*Health and Wellbeing
*Legal support
*Work-related support
62
Where is the RICS head office?
12 Great George Street London, SW 1P 3AD
63
What other professional groups are included in the RICS?
* There are 18 professional groups including:
o Building Surveying
o Building Control
o Facilities management
o Project Management
o Valuation
64
What is the RICS governing structure?
- Governing Council - Responsible for approving strategy and overseeing direction and performance of RICS
- RICS Group - Purpose to inform and oversee RICS affairs under delegated authority from Governing Council
- Standard and Regulation Board - Performs role of independent professional regulation within RICS
65
What is the RICS matrics?
- Early career communicated to support student, apprentices, trainee and those who are newly qualified (up to 10 years) as they move into the industry
- Provides opportunity to network and gain support as they go through assessment
66
What other memberships are their other than MRICS
* Student member
* APC Candidate
* Associate Member of RICS
* FRICS
67
How do you become FRICS?
You have to demonstrate four out of the twelve characteristics. There are 3 core principles;
* Demonstrate intent to further RICS and the profession.
* Act for the benefit of a third party to reflect RICS’ public interest mandate.
* Promote RICS objectives and the profession.
Submit application for assessment which is reviewed and decided by RICS
68
In professional Indemnity Insurance, what is the difference between each and every claim and aggregate?
- An 'any one claim' policy provides cover up to the full limit for each individual claim made, whereas
- an 'aggregate' policy provides cover up to the full limit for all claims made
To put this into context, if two £75,000 claims are made against a £100,000 any one claim professional indemnity policy, the insurer would cover the costs of both claims, as they are both under the £100,000 limit.
If two £75,000 claims are made against a £100,000 aggregate professional indemnity policy, the insurer would only pay up to the £100,000 limit. As the claims total £150,000, the remaining £50,000 would need to be covered by other means.
69
What is your RICS Membership number?
6629568
70
What is the role of the RICS?
RICS’ main roles are to:
- Set high ethical and technical standards.
- Enforce standards to protect consumers.
- Provide expert, impartial advice.
- Equip members with insights and training.
- Promote RICS status globally
71
What are the principles of better regulation?
- Proportionality
- Accountability
- Consistency
- Targeting
- Transparency
72
Who is the privy council?
They grant and award the royal charter
73
Who administers the rules and codes of conduct?
RICS Standards and regulation board
74
What are different types of RICS document?
There are two:
- Professional Standards - which set requirements for competent and ethical practice and
- Practice Information - which provide advice or practice support to RICS members and firms
75
What is the black book?
Collection of technical practice documents covering processes throughout construction project life cycle, topics include:
Cashflow
Acceleration
Cost Analysis and bench marking
Retention
E-Tendering
76
If you were approached to provide surveying services for a friend would you?
No. I would not hold PI I would only be able to under the umbrella of my company
77
What is FRICS?
An honoured class of membership awarded on the basis of individual achievement within the profession
78
How many countries do the RICS cover?
146 countries
79
How many people in the RICS governing council?
25 (15 market seats, 6 strategic seats and 4 leadership team seats)
80
How would you limit your liability on appointments?
Sign the appointments under hand
81
What is the Carsberg report?
A third party review of how the RICS regulates itself.
Recommended greater separation of regulatory and representational functions.
Recommended chartered surveyors should still be regulated by the RICS but that this should involve separate regulatory and conduct boards.
82
How many RICS professional groups are there?
18
83
What is the name of the RICS journals?
MODUS
84
What complaints can the RICS investigate?
Cases where there may be a need to take disciplinary action in the public interest and to maintain professional standards
85
What are your company’s Ethical standards?
All employees must act honestly, ethically and in compliance with the law and to protect the good name and reputation of the UUG.
86
What is the RICS mantra/ motto?
Est Modus Rebus’ = There is measure in all things
87
What are the RICS requirements that PI insurance must have?
- It provides minimum wording
- It sets out minimum levels of indemnity
- It sets out the maximum levels of uninsured excess
- Run off cover must be in place for at least 6 years
- It should include for past and present employees, directors and partners
88
If an estimate is incorrect, can the client claim damages against the QS?
Not necessarily, only if they can prove that the QS did not act with reasonable skill and care
89
What would your approach be if client wanted to pay you in advance for works
- Advise hat this money is not covered by the Client Money Protection scheme.
- Provide a receipt
- RICS advises against cash payments & request made by transfer & held in a client account.
90
What are Bye-Laws?
A law or rule governing the internal affairs of an organization.
A secondary law.
e.g.
1. Definitions set out by RICS
2. Membership & registration
3. Designations
4. Contributions to Funds
5. Conduct
6. Governing council, officers & staff
7. Subordinate boards, officers & staff
8. Procedure for general meetings
9. Accounts & Audit
10. General
91
What is the difference between Professional integrity & Professional ethics?
*Prof integrity – what we do – open honesty & transparency
*Prof ethics – how we behave & framework of how we act
92
How does the RICS promote sustainability?
a. RICS SKA rating for internal fitouts - rating helps landlords and tenants assess fit-out projects against a set of sustainability good practice criteria
b. Sustainability reports - Whoel ife carbon assessment professional standard
c. ICMS - International Cost Management Standard
d. New rules of conduct.
93
What sort of information do registered firms have to provide RICS with annually?
Annual Return (on-line) -
Types of business and staffing.
Nature of clients
Training Provisions
Complaints procedure & log
PI insurance details
Details on whether any client moneys are held
94
What is the Royal Charter?
The ROYAL CHARTER is a document issued by a Monarch as letters patent granting right of power to an individual or a body corporate
The Royal Charter requires us to promote the usefulness of the profession for the public advantage
Important changes to RICS’ constitution - its bye-laws - have to be ratified by the UK Government, through the Privy Council,
95
What should fees be?
Open and transparent - Client should understand what they have paid for
96
Are you aware of industry specific publications?
Modus
Building Magazine
Construction News
97
What was the Levitt review?
The Independent Review to investigate articles in the press that alleged that RICS ‘tried to supress a critical internal report into its finances in 2018/2019 and then unfairly dealt with those who sought to explore the issue
98
What happened following the Levitt Review?
The RICS accepted all recommendations
RICS commissioned the Bichard report
99
What is the Bichard Report & why was it conducted?
The Bichard Review was commissioned by the Governing Council in December 2021
Following a recommendation in the Levitt Review that a “wide-ranging examination of purpose, governance and strategy” should be conducted by an external reviewer, replacing the previous internal review ‘Defining our Future’
100
What was the conclusion of the Bichard report?
It makes 36 recommendations for implementation.
Place renewed focus on public interest and the role of members in leading the institution, and span regulation, diversity and inclusion, sustainability, member engagement, inspiring the next generation of surveyors and leadership on major issues of societal importance
101
Can you provide an example of a COI?
A consultant working on a tender then moves to a contractor or visa versa. It could affect impartiality.
102
What RICS rule covers financial crime such as Bribery?
* Rule 1
* Members and Firms must be honest, act with integrity and comply with their professional obligations including obligations to the RICS
103
What is corruption?
*The misuse of public office or power for private gain
104
What is money laundering?
*Concealing the source of the proceeds of criminal activity to disguise their illegal origin
105
What is Ethics?
*Ethical values are a set of moral standards by which we judge our actions to be right or wrong
*Ethics is not about what is legal, but what is morally right
106
For what reasons do we have Codes of Ethics/ Rules of Conduct?
*Guide ethical/ professional behaviour
*Ensure consisytency in decision making
*Set levcels of professional exepectation
*Help promote trust in the profession
*Provides clear justification for a particular course of action
*Serves as a point of reference for disciplinary proceedings
*Promotes ethical ethos/ culture within the profession
107
Who is likely to require more information before giving informed consent?
*Someone who does not regularly employ RICS professionals
108
If a party does not have sufficient understanding of the issue to give informed consent what must you do?
*The instruction should be declined
*UNLESS the client has taken independent advice
109
What conditions must be met before you may act despite a conflict of interest?
*All clients will gain if you act
*Clients have given informed consent
*Acting will not look bad
*You will act objectivley and diligently for each client
*Acting is lawful
