Ethics, rules of conduct and professionalism Flashcards
What are the RICS Rules of Conduct?
1) Be honest, act with integrity and comply with their professional obligations, including obligations to RICS (if an application for payment has a geniune error, advise contractor)
2) Maintain their professional competence and ensure that services are provided by competent individuals who have the necessary expertise (stick to your scope and only provide services you have the skill to do)
3) Provide good-quality and diligent service (ensure quality assurances are in place. Peer reviews)
4) Treat others with respect and encourage diversity and inclusion. (provide equal opportunities for everyone. Don’t discriminate or bully)
5) Act in the public interest, take responsibility for their actions and act to prevent harm and maintain public confidence in the profession (respond to complaints quickly and professionally)
What are the professional obligations of members?
- Members must comply with CPD requirements
- Members must co-operate with RICS
- Members must provide all information requested by the Standards and Regulation Board or those exercising authority on its behalf
What are the professional obligations of firms?
- Firms must co-operate with RICS
- Firms must provide all information requested by the Standards and Regulation Board or those exercising authority on its behalf.
- Firms must have a Complaints Handling Procedure in place
- Firms must have appropriate levels of PI in place
- Firms with a sole principle must have a contingency plan in case the sole principle dies
- Firms must display RICS designations on business papers
- Firms must report to RICS any matter that would be deemed necessary with the Standards and Regulations board.
When were the RICS Rules of Conduct changed?
02/02/2022
What is the RICS motto?
Es modus en rebus - there is measure in all things.
What does the RICS provide in order to help maintain professional standards?
- Professional Statements - mandatory requirements.
- Guidance Notes - not mandatory but are recommendations for best practice. (black book)
- APC - requirement for entering the profession.
- Data Standards - making sure you are utilising the best / most suitable technology and software
What is T&T’s Code of Conduct?
- How we work together (Treat others with respect, D&I, Prevention of bullying & harassment, Anti-discrimination, Violence-free workplace, Alcohol & drugs at work, H,S& Wellbeing, Compliance with employment laws)
- How we make a difference in our communities (Human rights, modern slavery, Positive impact on our communities, Environment, Making green choices, Charitable giving)
- How we conduct business with integrity (Anti-bribery, Conflicts of interest, Gifts & hospitality, Preventing tax evasion, Financial sanctions, Respecting privacy)
- How we protect our business (Acceptable use of IT, Social media, Safeguarding information, Use of AI, Accounting standards & internal controls, Anti-fraud, Corporate governance, Communicating with the media)
How do I align myself with T&T’s Code of Conduct?
I treat others with respect, I have taken part in charitable events and been involved in CSR days, I act with integrity, I abide by the anti-bribery & corruption policy
What are the RICS CPD requirements?
APC - 48 hours (24 formal)
Chartered - 20 hours (10 formal)
How would you check if the CPD is formal/informal?
Consult the RICS CPD Decision Tree
Questions include:
1. Is the outcome based on self-assessment?
2. Does the activity have a formally structured programme?
3. Is the learning assessed by an expert of test?
What is the RICS black book?
Set of best practice and technical standards to provide guidance to RICS members on undertaking these works.
Can you name a few of the black books?
Cash flow forecasting
Retention
Conflict avoidance, management and dispute resolution
Valuing change
Cost reporting
Extension of Time
Change control and management
What is PI and what is the purpose of it?
Professional Indemnity Insurance. Protects the individual, company and client from legal costs that arise from a claim due to an error, negligence or omission.
What are the 3 types of Conflict of Interest?
- Party Conflict (If you work for two different clients on a matter, where those two clients have conflicting interests, you will be conflicted e.g. working for client and contractor)
- Own interest conflict (where your own interests are at stake - recommending a s/c that I have a financial stake in)
- Confidential information conflict (if you are obliged to keep certain information confidential for one party but obliged to reveal the same information to another party e.g. 2 clients after the same project where I know the budgets)
When was the RICS founded?
1868
When was the Royal Charter granted?
1881 by Queen Victoria
Who is the RICS president?
It was Justin Sullivan but currently it is Nicholas Maclean as Acting president AND president elect
Maureen Ehrenberg - Vice President
What are the recommended PI levels?
The RICS rules require minimum levels of indemnity (cover) which is based on the firm’s turnover (net sales generated by a business) in the previous year:
Turnover £100,000 or less = £250,000 limit of indemnity
£100,001 to £200,000 = £500,000 limit of indemnity
Over £200,000 = £1,000,000 limit of indemnity
Run-off for consumer claims is £1million per year for 6 years.
For non consumer claims it is only stated that appropriate cover should be in place
Picking one of the Rules of Conduct, how do you demonstrate this in your day-to-day role?
Provide good quality and diligent services - every item of work that I carry out I make sure it’s comp checked and then peer reviewed by an AD or Director
What are the questions in the RICS decision tree?
Is it legal? Would you be confident in this becoming public knowledge? Are you acting in line with the Standards of Conduct?
What are the sanctions for non-compliance of CPD?
1 year - fixed penalty caution
2nd within 10 years - fixed penalty, published name on website, fine doubles if still unpaid in 28 days
3rd within 10 years - disciplinary panel, possible expulsion
What are the rules for the regulation of firms?
Firms are required to register for regulation if:
* They provide surveying services to the public
* They work within the Regulated Area A (UK)
* At least 50% of the principals are RICS Members.
If you wanted to set up your own firm, what steps would you need to take?
- Inform RICS of intentions
- Register with a bank
- Register with Companies House
- Register with HMRC
- Have appropriate PI cover
- Ensure further relevant insurances are in place (Employer’s Liability, 3rd party Liability)
- Set up client account for handling client money
- Set up a Complaints Handling Procedure
- Follow the Rules of Conduct
- If I was a small business, put in place a Locum
- 25% of principals must be chartered
What are the associated maximum levels of uninsured excess?
Based on limit of indemnity:
- Up to and including £10m - 2.5% of insured sum or £10k whichever is greater
- Over £10m - No set limit
What are the requirements for PII under RICS regulation?
- Fully retroactive - covers past projects
- Covers past and present people
- Each and every claim basis
- Policy wording must be on a full civil liability basis
- Has run-off cover
- Underwritten by RICS listed insurer
What is run off cover and what value is recommended?
Run-off covers protects firms for works undertaken by individual who has left the business or if the business ceases trading.
It should be in place for a minimum of 6 years from the policy expiry date and for a minimum limit of £1m.
What happens if the claim is greater than the PI cover?
The company is liable for the additional monies and assets and the like can be used to pay this off. Limit of liability can mitigate this.
What is a ‘Limit of Liability’ clause?
Limitation of liability clauses limit the amount one party has to pay the other party if they suffer loss because of a contract between them. To be enforceable, limitation of liability clauses need to be reasonable and carefully drafted, so make sure you pay great attention to them whenever you enter into a contract
Caps on liability are common in construction projects. Limitations of liability, if included in the contract, are usually agreed at a sum no less than the level of professional indemnity insurance that the contractor must maintain. Other contracts contain express caps on the total loss recoverable from the contractor.
Can you give me a scenario for client wanting to withhold money from the contractor?
Defective installations.
Not complying with Building Regs
What are the RICS’s Core Values?
- Integrity
- Transparency
- Professionalism
- Respect
- Responsibility
The Conduct Rules require you as a chartered professional to act with integrity. Can you provide an example of where you believe you have acted with integrity whilst undertaking your role as a Cost Manager?
When I worked on the Essity project I noticed while assessing the contractor’s interim application that they hadn’t claimed for
You identify the requirement to undertake CPD. Can you outline the requirement for CPD as a Chartered professional?
20 hours in total, 10 of which must be formal
How do you determine if CPD is either informal or formal?
Consult the RICS APC decision tree.
Some questions?
Can you tell me what “Informed Consent” is, in relation to a Conflict of Interest?
When it has been logged with the client and they have given their approval to carry on
If you were successful in your assessment today and you became a chartered professional, could you outline the requirements the RICS would need you to put in place, if you were to establish your own business?
Notify RICS
Company bank account
Have the necessary PI insurance
Have a complaints handling procedure
How would you define formal and informal CPD?
Formal - structure with clear objectives and outcomes (Training course, structured online training)
Informal - self-managed learning hat is relevant to role (private study, on-the-job training)
What is a Bribe?
Someone trying to give you something in order to gain an advantage.
What is the Bribery Act and what are the 4 main offences?
Bribery Act 2010 - covers criminal law relating to bribery.
Applies to all UK entities and associated persons.
- Bribing another person
- Bribing a public official.
- Allowing yourself to be Bribed.
- Failure as a business to prevent bribery.
What are its 6 main principles of the Bribery Act?
- Proportionality
- Top Level Commitment
- Risk Assessment
- Due diligence
- Communication
- Monitoring & Review
What is the role of the RICS?
is a professional body that sets and enforces standards for the built environment and real estate sectors. Its key roles are:
Regulating and Certifying Professionals
Setting Global Standards
Providing Guidance and Training
Ensuring Ethical Conduct
Influencing Policy and Industry Trends
When is a firm eligible to register for RICS?
- Provide services to the public
- 25% of the principals are RICS Members
What would you do if the client doesn’t pay the contractor?
Assuming that there is no reason the client can issue a Pay Less Notice, I would speak to the client and ask them why this want to withhold money.
If the client is having cash flow issues I would recommend that we have a face-to-face meeting with the contractor and be honest about the situation. It could be that an agreement could be made with regards to payments (e.g. more regular payments the following months) as opposed to dispute occurring which may result in costs to both parties to resolve.
What is the RICS’s Mission Statement?
To promote and enforce the highest professional qualifications and standards in the development and management of land, real estate, construction and infrastructure
With regards to PI Insurance, how do you know what limit of indemnity to use if it’s a new company?
Based on estimated turnover
Why do you want to be a member of the RICS?
Because it represents the highest standards of professionalism, ethics, and expertise in the built environment. Achieving membership would not only validate my skills and knowledge as a Quantity Surveyor but also demonstrate my commitment to continuous learning and professional integrity.
What is corruption?
The misuse of public office or power for private gain, or misuse of private power in relation to business practice and performance.
What is a facilitation payment and are they ever allowed?
Facilitation payment is a payment made to speed up the process of something.
Only in the circumstances where someone is under duress, if there is real and present danger to life or limb.
How would you set up a clients money account?
- Clients must always have immediate access to funds
- Client money must be kept in a designated client account and clearly identifiable
- The account should have client in the title and the firms name or identifier if it is a discrete account
- Interest must be agreed with the client
- Maintain a ledge on the running balance of any transactions
- Agree terms and advise client on details
- Must never be in an overdrawn position
Assuming you were successful in getting chartered, how would you deal with a situation where your partners parents are getting an extension done on their house and they’ve asked you for your advice in terms of QS services. How would you respond?
Firstly, you cannot operate as a Chartered Quantity Surveyor without Professional Indemnity Insurance. You would not be able to provide advice and put your name to it unless you held the appropriate level of PII cover.
Secondly, you still need to make sure that any advice you provide goes through the necessary and relevant checks and balances prior to it being issued. Just because it is for a friend, it does not mean that an appropriate checking process can be bypassed.
Can you tell me what the Bichard review is?
The Review aimed to clarify the purpose of RICS, make proposals on its governing structure, and make proposals for the incoming leadership and governing body on the future culture and strategy of the Institution
What does RICS say about handling client money?
Client Money Handling Professional Statement.
Gives information on client account requirements, appropriate accounting controls, information that firms must give to their clients.
Provides confidence to clients that RICS regulated firms are operating to highest standards.
What is included in Appendix A?
What is the Clients Money Protection Scheme?
Run by RICS and provides any member of the public to be reimbursed for loss of funds. It is reimbursed through the RICS insurance policy.
What are the 5 principles of better regulation?
PACTT:
Proportionality
Accountability
Consistency
Targeting and
Transparency
