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APC > 1. Ethics, Rules of Conduct and Professionalism > Flashcards

1. Ethics, Rules of Conduct and Professionalism Flashcards

1
Q

When was RICS founded?

A

1868

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2
Q

When was the RICS Royal Charter granted?

A

1881

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3
Q

What is the Role of RICS? (3)

A
  1. Maintain highest standards of education and training,
  2. Protect consumers through strict regulation of professional standards
  3. To be leading source of information and independent advice on land, property, construction and associated environmental issues
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4
Q

How many RICS members are there?

A

130,000 qualified members (TBC)

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5
Q

What are the different membership types? (4)

A

FRICS, MRICS, AssocRICS, Trainee/Student

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6
Q

What is the RICS Governance Structure? (8)

A
  1. Privy Council - advisory board to Monarch and Ministers
  2. Governing Council - provides management and strategic direction
  3. Regulatory Board, Management Board, and various committees report to Governing Council
  4. 17 Specialist Professional Groups covering property, land etc
  5. Each professional group has an Elected Board and is responsible for outlining standards of competence and practice
  6. Chair of Governing Council is Nick Maclean (TBC)
  7. Chief Executive is Richard Collins (TBC)
  8. President is Clement Lau (TBC)
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7
Q

What is the RICS UK Structure? (3)

A
  1. 4 National Associations
  2. 10 Regional Boards
  3. Local Associations
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8
Q

What was the Levitt Report?

A

Criticism of RICS governance as a result of poor financial controls which lead to reputational damage. The Governing Council apologised for the wrongful dismissal of 4 non-executives who raised concerns. Lead to a review of internal governance and advised to increase board members.

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9
Q

What were the 6 values published in the Governing Council’s statement, in apology to the Levitt Review?

A
  1. Integrity
  2. Transparency
  3. Inclusion
  4. Collaboration
  5. Advocacy
  6. Passion
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10
Q

Lord Bichard is to carry out an independent review of RICS’ purpose, governance and strategy summarised in the “Defining our future: RICS Strategy Review”. What are the objectives of the review? (3)

A
  1. How to maintain stakeholder and public trust
  2. Ensure RICS remains sustainable
  3. How to align RICS purposes with interests of stakeholders and industry
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11
Q

What are the advantages of being a RICS member? (5)

A
  1. Status
  2. Recognition
  3. Knowledge
  4. Network
  5. Market Advantage
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12
Q

What are the five principles of RICS Regulation for Members and Firms? (clue: PACTT)

A
  1. Proportionality - making penalty proportional to breach
  2. Accountability - to members and public
  3. Consistency - treating all members the same
  4. Targeting - serious breaches
  5. Transparency - to members, clients and public
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13
Q

What is the Statement of Ethical Principles and Rules of Conduct (1st Edition)? (3)

A
  1. Combines and simplifies Rules of Conduct for Members and Firms and Global Professional and Ethical Standards into one document.
  2. Reflects original five ethical standards, however, includes competence over trust.
  3. Provides a number of case studies and behaviours for each rule to reflect upon and RICS mandatory rules for members and firms contained within Appendix.
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14
Q

What is the Professional and Ethical Standards Decision Tree? (3)

A
  1. Questions to go through when you are asked to act in a potentially manner or situation.
  2. Encourages members to consider legalities of actions and their consistency with RICS Global and Ethical Standards.
  3. Consult senior colleagues and have clear reasoning.

Test: would you want decision to be made public? If in doubt, phone RICS Regulation Confidential Hotline for ethical issue.

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15
Q

What are the five Rules of Conduct?

A
    1. Be honest, act with integrity and comply with their professional obligations and obligations to RICS
  2. Members and firms must maintain their professional competence and ensure that services are provided by competent individuals who have the necessary
    expertise
  3. Members and firms must provide good-quality and diligent service
  4. Members and firms must treat others with respect and encourage diversity and inclusion
  5. Members and firms must act in the public interest, take responsibility for their actions and act to prevent harm and maintain public confidence in the profession
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16
Q

What are the three benefits of regulation for Firms?

A
  1. Confidence - monitored by RICS
  2. Professionalism - firms provide clear, impartial, expert advice
  3. Security - complaints procedure, access to free independent redress and PII cover
17
Q

What is the requirement for RICS registration?

A

If over 50% of principals in company are MRICS then it has to be regulated. If at least 25% of principals are MRICS, it has option to be regulated

18
Q

What is the annual return of information should be provided to RICS for registration? (6)

A
  1. Type of business and staffing
  2. Statutory regulated activities - such as for financial services
  3. Nature of clients
  4. Complaint’s handling
  5. PII
  6. Whether firm holds client money
19
Q

What does “Responsible Principal” mean?

A

Ensure compliance with RICS including to report to RICS as required

20
Q

What are the three stages of a Disciplinary Procedure?

A
  1. Action by Head of Regulation
  2. Regulatory Tribunal
  3. Appeal Panel
21
Q

What are the most common breaches? (3)

A
  1. Ethical / Professional behaviour
  2. CPD
  3. Client’s money
22
Q

What are the four options for disciplinary action?

A
  1. Fixed penalty notice
  2. Regulatory compliance order
  3. CPD sanction
  4. Refer matter to Regulatory Panel
23
Q

What are the five penalties available to the Regulatory Panel?

A
  1. Compliance order
  2. Unlimited fine per breach but proportionate
  3. Conditions of future RICS registration
  4. Expulsion of member / firm
  5. Require publication of hearing results - Modus, RICS website etc
24
Q

What are the six RICS Hierarchy of Publications?

A
  1. Rules of Conduct (for Firms and Members)
  2. International Standards (Mandatory)
  3. Professional Statements (Mandatory)
  4. Practice Statement (Mandatory)
  5. Guidance Notes (Voluntary)
  6. Codes of Practice (Mandatory or Recommended Good Practice)
25
Q

What are the principles for Fee Negotiations?

A
  1. Must avoid price fixing, aggressive fee cutting and collusion with competitors
  2. Fees must be market based, agreed on an ad-hoc basis with client, must make clients aware if receiving referral fees and state in Terms of Engagement

(Four Somerset estate agents prosecuted and fined by Competition and Markets Authority for collusion in setting minimum commission rates in March 2017)

26
Q

What are the three procedures for Terms of Engagement?

A
  1. Check if professionally competent
  2. No conflicts of interest / personal interest
  3. Confirm Terms of Engagement agreement in writing

*Consumer Rights Act 2015 - 14 day cooling off period
*Consider Money Laundering Regulations 2019 for Agency work - The Money Laundering and Terrorist Financing (Amendment) Regulations 2019

27
Q

W

A
28
Q

Why would you decline work? (6)

A
  1. Not competent
  2. Insufficient facts
  3. Proposed client will not sign TOE
  4. Conflict of Interest
  5. PII cap cannot be agreed
  6. Advice on a pro bono basis (charity) and PII will not cover
29
Q

What are the four examples of Conflict of Interest?

A
  1. Financial Interest
  2. Personal Interest
  3. Commercial relationship
  4. Acting on both sides of transaction

If there is a conflict of interest then do not accept instruction

30
Q
A
31
Q

How can a conflict be managed?

A
  1. Accept instruction, but written steps are agreed with all parties, and conflict is managed with information / ethical barrier
32
Q

What are the five RICS Global Professional Statements on Conflict of Interest 2017?

A
  1. Mandatory from January 2018
  2. States members must not advise client where conflict exists unless informed consent of all parties affected
  3. Informed consent only allowed when proceeding is considered is in the interest of all who may or are affected and is not prohibited by law
  4. All firms must have effective systems to ensure compliance with statement
  5. All firms must keep records to show compliance
33
Q

What are the three types of conflict?

A
  1. Party Conflict - same or related work instruction for two different parties
  2. Own Interest Conflict
  3. Confidential Information Conflict - relating to work between two parties that is confidential
34
Q
A

APC (21 decks)

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