L2 - Conflict of interest check, Peterborough (Retail)

Question 1

What is a conflict of interest?

Answer 1

When a member or firm’s independence and impartiality is threatened due to the existence of a conflict between two parties.

Question 2

What is the best way to deal with a conflict?

Answer 2

• Transparency and open ness.
  There is not a ‘one size fits all’ approach and it is down to the job manager to determine the scope of the necessary check.

Question 3

What are the different types of conflict of interest?

Answer 3

• Party conflict - working for the same ore related instructions for two different parties.
• Own party - relating to a personal interest
  Confidential information conflict -relating to work between two parties that is confidential

Question 4

How do you undertake the Conflict check at your firm?

Answer 4

1. Register an instruction in the Salesforce system. Using Key job details such as property type, location, parties involved, period, job type.
   
   2. Register as Job or Job lite to determine the extensiveness of the check
   3. The system will then check for potential conflicts of interest and inform you of the severity of the conflict.
      It is then down to the surveyor to determine the severity of the conflict and decide on appropriate action.

Question 5

What would you do if a conflict arises following a check?

Answer 5

• The best way to deal with a conflict is openness and transparency
  
  • If I were to identify any potential conflicts or anything that may influence me, I would declare them to all of the appropriate parties involved as soon as possible being as clear as I can.
  • I would then offer to stand down from acting for any party enabling all parties to make an informed decision about how to proceed.
  • If any party were to object to me continuing to act, then I would step away from the instruction.
  • Conflict avoidance is not accepting an instruction.
  • Conflict management is when the instruction is accepted and steps are agreed and put in place to manage the conflict, such as an information/ethical barrier, with the written agreement of all parties.
    Seek approval from head of department.

Question 6

What is the difference between conflict of interest and conflict management?

Answer 6

• Conflict avoidance is not accepting an instruction.
  Conflict management is when the instruction is accepted and steps are agreed and put in place to manage the conflict, such as an information/ethical barrier, with the written agreement of all parties.

Question 7

What can you tell me about the RICS Global Professional Statement on Conflicts of interest 2017?

Answer 7

• The RICS PS introduces the three definitions of the different types of conflict of interest.
• Party conflict
• Own party conflict
• Confidential information conflict
• The global statement does not allow you to choose whether you can proceed despite a Conflict of Interest or a significant risk of one: it prohibits you from proceeding, unless you obtain prior written informed consent from all affected parties.

Outlines ‘informed consent’ & information barriers

Question 8

What is informed consent?

Answer 8

• It means consent given willingly by a party who may be affected by a Conflict of Interest an which demonstrates the party understands;
• There is a conflict or a significant risk of a conflict
• The facts known by the firm that are material to the Conflict of Interest;
• What the known conflict might be
• That the interest may affect the ability of the firm to advise or act fully in the interest of a client.
• Informed consent must only be sought where the RICS member or regulated firm is satisfied that proceeding despite a conflict is:
• In the interest of all those affected
  Not prohibited by law.

Question 9

When is informed consent appropriate/not appropriate?

Answer 9

• Only appropriate if; (Opposite for not appropriate)
• There is transparency regarding the material factors
• Is sure that the party affected understands what they are doing and understands the risks involved and alternative options available.
  Both parties are acting willingly.