Ethics, Rules of Conduct & Professionalism Flashcards
What is the meaning of the RICS moto?
There is measure in all things.
What is the mission statement of the RICS
- To qualify and equip their members to provide the highest level of professional service.
- To promote and enforce standards.
- To lead solutions to the major challenges faced by the built environment.
When was the RICS founded?
1868
What are the RICS’s 5 principles of better regulation?
- Proportionality
- Accountability
- Consistency
- Targeting
- Transparency
What is the difference between RICS ethics and rules of conduct?
- Ethics are a set of moral values
- Rules are of conduct are a framework which we should all work to.
How many RICS global and ethical standards are their?
- Until 1st February 2022 there were 5 Global and Ethical Standards.
- From 1st February 2022 these have been consolidated within the New Rules of Conduct 2022.
What are the 5 RICS Rules of Conduct
1.Members and firms must be honest, act with integrity and comply with their professional obligations, including obligations to the RICS
- Members and firms must maintain their professional competence and ensure that services are provided by competent individuals who have the necessary expertise.
- Members and firms must provide good quality and diligent service
- Members and firms must treat others with respect and encourage diversity and inclusion.
- Members and firms must act in the public interest, take responsibility for their actions, act to prevent harm and maintain public confidence in the profession.
Why did the previous rules of conduct change?
- The previous rules had 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 the separate global professional standards.
- This provided a single document which enabled greater clarity for RICS members and firms.
- I also understand that their is a greater emphasis on clearer example behaviours, understanding evolving technology and tackling climate change.
Talk us through your understanding of the Rules of Conduct changes?
The Rules of Conduct October 2021 Global Practice Statement will overhaul the previous separate documents:
- Rules of conduct for members
- Rules of conduct for firms
- Global professional standards.
Appendix A of the Rules of Conduct now contain the professional obligations of members and firms.
What are the professional obligations of members?
- Members must comply with the CPD requirements set by the RICS, which requires members to complete 20 hours of CPD, 10 of which are required to be formal CPD.
- Members must cooperate with the RICS
- Members must promptly provide all information reasonably requested by the Standards and Regulation Board, or those exercising delegated authority on behalf of the RICS.
Why does the RICS have Rules of Conduct?
- To provide a framework that we can all work to and so the client knows they are getting a set level of service.
- As well as being an important tool for the institution, the Rules of Conduct are also a useful professional guide for individual institution members.
Your brother-in-law is a chartered surveyor. You find out that he is working outside the RICS Rules of Conduct. What do you do?
- I verify the facts and confront him, reminding him of his duties as a member of the RICS.
- I inform the RICS stating my relationship to the person and any corrective action that I believe my brother-in-law is putting in place.
In the case of a breach of a rule of conduct, what is the procedure?
- Not every shortcoming will give rise to proceedings
- A formal investigation by the Head of Regulation of the RICS is the first step in the process.
- This may lead to a compliance / consent order if the member admits the breach.
- If there is no admission it may lead to a disiplinary panel hearing.
How can a disciplinary proceeding be triggered?
- Somebody complaining to the RICS
- An allegation by a client or a third party
- Information received or established by the RICS
What three actions can be imposed after the end of an RICS investigation following a Rules of Conduct Breach?
- Fixed penalty
- Consent order
- Disciplinary panel
What are fixed penalties?
- A fine by the RICS
What are consent orders?
It is a written agreement between the RICS and a member or firm concerning a disciplinery issue or a breach of the RICS rules.
It can require a member to:
- Take certain corrective actions, or
- Restrain then from taking certain actions for a specific period of time and
- May require them to pay a fine or incurred costs.
When is a disciplinary panel applicable and what can you tell me about them?
- They are used for more serious breaches
- The panel will usually be held in public
- The burden of proof is on the RICS
- A balance of probabilities approach will be adopted
What sort of breaches would expulsion be suitable for?
- Gross, persistent or willingly failure to comply with an RICS rule or conduct
- Fraud, dishonesty, conviction of a serious criminal offence, gross incompetence, deliberate discrimination and misappropriation of client money.
What procedures must you follow if you are starting up a new practice?
- Contact the RICS for guidance and obtain a company starter pack.
- Inform the RICS and register for regulation.
- Prepare a complaints handling procedure.
- Abide by the RICS Rules of Conduct.
- Use and designation ‘ Regulated by the RICS’ on all practice material.
- PII Insurance, Building Insurance, Public Liability Insurance (PLI), Employers Liability Insurance.
Would you advertise your new company on the press?
Yes, as long as it is in a trustful and respectable manner, in line with the RICS Rules of Conduct.
What insurances would you need if you were starting up your own firm?
- Professional Indemnity Insurance (PII)
- Employers Liability Insurance (ELI)
- Public Liability Insurance (PLI)
- Buildings insurance of an office premises (BIO)
What sort of information do registered firms have to send to the RICS annually as part of there ‘annual return’ and what are the consequences of failure in doing so?
This information includes;
- Type of business and staffing.
- Nature of their clients.
- Complaints handling procedure and records of any complaints.
- Training provision.
- Professional Indemnity (PI) insurance details.
- Whether the firm holds clients money.
Failure to do so is punishable by a fixed fine.
What process do regulated firms need to put in place when handling clients money?
It is crucial to preserve the security of client’s money which does not wholly belong to the company.
Regulated firms that operate a client’s account must;
- Set clear segregation of duties for employees.
- A principle oversees the client money accounting functions.
- Principles cannot override controls.
- Competent and knowledgeable staff are to process client’s money with cover for long term absence allowed for.
- The client’s money account must be kept separate from other accounts and labelled ‘client’ along with the firms name.
- The Client must always have access to funds.
- The account must not be overdrawn.
- Secure accounting systems and data.
- Keep regularly updated records and provide the client with a running total.
- Agree terms with the client and provide them with account details.
- All other obligations are within the handling client money professional standard.
What are the different types of client money accounts?
- General accounts hold money for more than one client
- Discrete accounts are assigned to an individual client.
What is meant by the term Negligence and what are the consequences of being negligent?
- Negligence is a failure to provide the duty of care that is owed to the client or 3rd party.
- A duty of care is care is owed to all clients or 3rd parties using reasonable skill & care.
- If the duty of care is breached due to Negligence a claim may arise resulting in damages being paid or a professional indemnity insurance claim being incurred.
Tell us about Merit v Babb case law?
- This case dates back to 2001 and highlights the importance of having run off cover in place.
- A surveyor was sued for negligence by a former client.
- Because the firm was no longer in practice, the client managed to successfully sue the individual surveyor.
- This caused a big shock in the industry and highlighted the need for run off cover to be in place for all previous employees.
What must a complaints handling procedure include?
- The RICS provides a model form
- The receipt of the complaint must be confirmed to the complainant within 7 days and must be investigated within 28 days of the complaint.
- The process must include a redress mechanism (a way to accept, assess, and resolve complaints)
- Details of the policy should be issued to the client with the Terms of Business.
- It must be clear, quick, transparent and impartial.
- Names and contact details of nominated investigating person should be stated.
- All complaints, their progress and their outcomes must be recorded.
- Need to advise PI insurers of a complaint immediately.
- The process must have a minimum of two stages.
What are the two stages required as a minimum within a complaints handling procedure?
- Stage 1: where there needs to be consideration of a complaint by a senior member of the firm or the complaints handling officer. This stage must be free of charge.
- Stage 2: if the issue is not resolved then the complaint is referred to an independent third party with the authority to award redress. The complainant may be expected to contribute towards costs at this stage.
What is an independent redress scheme?
- It is a consumer scheme designed to handle small issues that would be disproportionately expensive to take to court.
- If the scheme judges in favour of the consumer, then the finding is binding.
- If the scheme judges in favour of the firm, then the decision can be escalated to the court.
- If the complaint related to a large sum of money, or if the complaint wishes to do so, they can take the matter to court.
- Includes property ombudsman.
What do you do if you receive a letter of complaint?
I would acknowledge the receipt of the letter and then, as per our firms complaints handling procedure, I would forward it to the person within my firm designated with handling complaints and would provide additional information as requested.
I would also highlight the importance of notifying the PII providers immediately.
What is the RICS Clients Money Protection Scheme?
This is a money protection scheme provided by the RICS.
Its contains provision for any member of the public to be reimbursed of direct loss of funds when using any RICS regulated firm.
This is provided through an RICS insurance policy.