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Ethics Flashcards

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1
Q

What is the RICS Governance Structure?

A

• Privvy Council
• Governing Council
• RICS Board
• Standards and Regulations Board
• Regulatory Tribunal (separately)

The RICS Governance Structure outlines the key bodies that oversee the operations and regulations of RICS.

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2
Q

Who is the leader of the Privvy Council?

A

Lucy Powell

Lucy Powell serves as the leader of the Privvy Council within the RICS governance structure.

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3
Q

Who is the current President of the RICS?

A

Justin Sullivan

Justin Sullivan holds the position of President in RICS.

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4
Q

Who is the president elect of RICS?

A

Nicholas Maclean

Nicholas Maclean has been elected as the upcoming president of RICS.

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5
Q

Who is the senior VP of RICS?

A

Maureen Ehrenburg

Maureen Ehrenburg serves as the Senior Vice President of RICS.

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6
Q

What is the role / purpose of the RICS?

A

• A global professional, standards and regulatory body
• Existing to secure the advancement and usefulness of the profession for the public advantage
• Focused on setting standards and assuring these standards are in the public interest
• Delivering support that is valued by RICS members and their employers
• Developing members’ professional skills and knowledge
• Expanding opportunities for members to apply those professional skills

RICS aims to promote the profession while ensuring public interest and member support.

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7
Q

What is the governing council?

A

• The highest governing body in the RICS
• Sets the global strategy of the RICS and ensures it fulfills its Royal charter obligations

The Governing Council is responsible for the strategic direction and adherence to RICS’s Royal charter.

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8
Q

What do you know about the Standards and Regulation Board?

A

• Responsible for strategy, policy, and operational oversight of the standards
• Manages entry and admission to the profession, and regulatory functions of RICS
• Sets rules for registration
• Recently revised the RICS document categories into Professional standards and Practice information
• Wrote the new RICS Rules of Conduct after consultation

The Standards and Regulation Board plays a critical role in maintaining the integrity and standards of the profession.

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9
Q

What do you know about the Management Board?

A

• Directs RICS affairs under delegated authority from Governing Council
• Comprised of non-members (independent), members of RICS, and RICS Executives

The Management Board is tasked with operational oversight and decision-making within RICS.

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10
Q

What do you know about the Audit, Risk Assurance, and Finance (ARAF) Committee?

A

• Ensures the integrity of financial reporting and audit process
• Oversees maintenance of sound internal control and risk management systems
• Reviews anti-fraud measures and Raising Concerns policies
• Recommends the appointment of the external auditor annually

The ARAF Committee is crucial for financial integrity and risk management within RICS.

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11
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A
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12
Q

What does STIRR stand for in global professional and ethical standards?

A

Service, Trust, Integrity, Respect, Responsibility

STIRR is an acronym representing key ethical principles for professionals.

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13
Q

What is the first component of STIRR?

A

Service

Always provide a high standard of service.

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14
Q

What does the ‘Trust’ component of STIRR emphasize?

A

Act in a way that promotes trust in the profession

This principle is crucial for maintaining credibility.

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15
Q

What is the significance of ‘Integrity’ in STIRR?

A

Act with integrity

Integrity is foundational to ethical behavior.

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16
Q

What does the ‘Respect’ component of STIRR entail?

A

Treat others with Respect

Respect fosters a positive professional environment.

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17
Q

What does ‘Responsibility’ mean in the context of STIRR?

A

Take Responsibility

Accountability is key to professional conduct.

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18
Q

What types of documents does the RICS issue?

A
  • Professional statements
  • Standards
  • Guidance Notes
  • Codes of Practice
  • Jurisdiction guides

These documents provide frameworks and guidelines for practice.

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19
Q

How do the professional and ethical standards relate to RICS rules of conduct?

A

They go hand in hand, requiring integrity from members and firms

Both sets of standards emphasize ethical behavior.

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20
Q
A
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21
Q

What is a conflict of interest?

A

A conflict of interest is when an existing relationship that prevents or might prevent an individual or firm’s ability to act impartially.

This can involve personal, financial, or professional relationships that may influence decision-making.

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22
Q

Why is identifying a conflict of interest important?

A

It allows RICS regulated firms and members to demonstrate professionalism in the industry and creates trust, giving confidence to clients.

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23
Q

What are the different types of conflict of interest?

A

Types of conflict of interest include:
* Party Conflict
* Own Interest Conflict
* Confidential Information Conflict

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24
Q

Describe Party Conflict.

A

A situation where the duty of a RICS member or regulated firm to act in the interests of one client conflicts with a duty owed to another client or party.

Example: Working for two different clients bidding for the same work.

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25
Describe Own Interest Conflict.
Conflict due to existing interests of that RICS member or firm. ## Footnote Example: A personal relationship.
26
Describe Confidential Information Conflict.
When the duty of a RICS member or firm to provide material information to one client conflicts with the duty to keep the same information confidential for another client. ## Footnote Example: Acting on behalf of one client while also representing another impacted by the first client's plans.
27
What is an information barrier?
The physical and/or electrical separation of individuals (or groups) within the same firm that prevents confidential information passing between them.
28
Can you proceed with an appointment after identifying a conflict of interest?
You must not accept the instruction or continue acting for the client unless: * You can give independent and objective professional services * It is in the best interest of the client * You have shared relevant information with the parties and they have given informed consent.
29
What is an effective conflict of interest procedure?
An effective procedure includes: * Identify * Manage * Monitor
30
What does AtkinsRéalis do to prevent conflicts of interests?
AtkinsRéalis employs: * Online portal to notify a conflict * Keeps records * Annual training * Conflict of interest disclosure forms
31
When was the last Conflict-of-interest RICS statement released?
Initially released in March 2017 and updated in July 2023.
32
What RICS Guidance is there on Bribery and money laundering?
Professional statement – Countering Bribery, Corruption, Money Laundering and terrorist financing (2019).
33
What are the main pieces of legislation relevant to Bribery, Corruption, Money Laundering and Terrorist Financing?
Relevant legislation includes: * The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 * Countering Bribery, money laundering and terrorist financing – Professional Standard * Bribery Act (2010) * Terrorism Act (2000) * Proceeds of Crime Act (2002)
34
What is a bribe?
A bribe is an incentive that is offered to gain an unethical advantage.
35
What is the Bribery Act 2010?
Bribery Act 2010 is primary legislation in the UK that punishes against public or private bribery.
36
Can you give examples of a briber under the Bribery Act?
Examples include: * Bribing another person * Accepting a bribe * Bribing a foreign public official * Failure by a commercial organisation to prevent bribery.
37
What are the key principles under the Bribery Act 2010?
Key principles include: * Principle 1 = Proportionate Procedures * Principle 2 = Top Level Commitment * Principle 3 = Risk Assessment * Principle 4 = Due Diligence * Principle 5 = Communication (including training) * Principle 6 = Monitoring & Review
38
What must firms ensure in relation to bribery and corruption?
Firms must: * AVOID * REPORT * REVIEW * IDENTIFY * VERIFY * RECORD
39
What are the mandatory requirements for RICS Members in relation to Money laundering & Terrorist Financing?
Mandatory requirements include: * Avoid – Do not facilitate or be complicit in Money Laundering or Terrorist Financing * Report – Report any suspicions of Money Laundering or Terrorist Financing.
40
Who would you report suspicions of Money Laundering or Terrorist Financing to?
You would report it to the Serious Fraud Office.
41
What are the rules of conduct?
The rules of conduct are issued by the RICS, setting out the standards and practices expected of all RICS members and regulated firms. ## Footnote They are mandatory for all members and firms.
42
When did the new rules of conduct come into place?
2022 ## Footnote They replaced the previous rules of conduct for members and firms which was a separate document for each.
43
What is Rule 1 of the rules of conduct?
Honesty & Integrity o Members and firms must be honest, act with integrity and comply with their professional obligations, including obligations to RICS. ## Footnote Members and firms must be honest, act with integrity, and comply with their professional obligations, including obligations to RICS.
44
What is Rule 2 of the rules of conduct?
Competence o Members and firms must maintain their professional competence and ensure that services are provided by competent individuals who have the necessary expertise. ## Footnote Members and firms must maintain their professional competence and ensure that services are provided by competent individuals who have the necessary expertise.
45
What is Rule 3 of the rules of conduct?
High quality of work o Members and firms must provide good-quality and diligent service. ## Footnote Members and firms must provide good-quality and diligent service.
46
What is Rule 4 of the rules of conduct?
Respect and encourage diversity Members and firms must treat others with respect and encourage diversity and inclusion. ## Footnote Members and firms must provide good-quality and diligent service.
47
What is Rule 5 of the rules of conduct?
Prevent harm and maintain public confidence in the industry o 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. ## Footnote 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.
48
Can you give an example of how you have acted in line with Rule 2?
Whilst studying towards my APC, I have been completing my CPD in line with the RICS standards to continuously develop my knowledge and expertise.
49
Can you give an example of how you have acted in line with Rule 3?
When working on projects for clients, I request feedback and complete interim meetings with my clients to ensure I am meeting their expectations in the work I am producing for them.
50
What is included in Appendix A of the Rules of Conduct for members?
3 obligations 1. Members must comply with CPD Requirements set by RICS 2. Members must cooperate with RICS 3. Members must promptly provide all information reasonably requested by the Standards & Regulations Board, or those exercising delegated authority on its behalf. ## Footnote Members must comply with CPD Requirements, cooperate with RICS, and provide information reasonably requested by the Standards & Regulations Board.
51
What is included in Appendix A of the Rules of Conduct for firms?
7 obligations 1. Firms must publish a complaints-handling procedure, including an ADR 2. Firms must ensure that all previous and current professional work is covered by adequate and appropriate Professional Indemnity Cover that meets the RICS standards. 3. Firms with a sole principal must make appropriate arrangements for their professional work to continue in the event of their incapacity, death or absence from work (locum agreement) 4. Firms must cooperate with the RICS 5. Firms must promptly provide all information reasonably requested by the Standards & Regulations Board, or those exercising delegated authority on its behalf. 6. Firms must display on their business literature, a designation to denote that they are Regulated by RICS. 7. Firms must report to RICS any matter that they are required to report under the Rules for Registration of firms. ## Footnote 1. Publish a complaints-handling procedure, including an ADR. 2. Ensure adequate Professional Indemnity Cover. 3. Make arrangements for professional work continuity in case of incapacity. 4. Cooperate with RICS. 5. Provide information reasonably requested by the Standards & Regulations Board. 6. Display designation of being Regulated by RICS. 7. Report required matters under the Rules for Registration of firms.
52
What is professional indemnity insurance?
Insurance taken out to protect consultants (& contractors completing design works) against claims of negligence ## Footnote Professional indemnity insurance is crucial for professionals providing advisory or design services.
53
What does PI cover?
PII protects individuals against claims for loss or damage made by clients (or third parties) as a result of the impact of negligent services that have been provided ## Footnote This coverage is essential for mitigating financial risks associated with professional services.
54
What is one guidance document related to PII?
Professional Indemnity Insurance Requirements – RICS – April 2022 ## Footnote This document provides the framework for PII standards in the profession.
55
What does the RICS say about PII?
All RICS-Regulated firms need to ensure that they have adequate and appropriate PII that complies with the RICS standards ## Footnote Compliance with these standards is mandatory for RICS members.
56
What are the RICS minimum requirements for PI Insurance?
* RICS Minimum Policy Wording (or more comprehensive wording) - Written on a Full Civil Liability Basis * Cover for 'Each and Every' claim basis, or in the Aggregate (plus Unlimited 'Round-the-Clock' Reinstatement) * Minimum Level of Indemnity based on the Firm's Turnover in the previous year (or estimated for a New Firm) * Maximum Level of Uninsured Excess * Be Fully Retroactive (on a 'Claims Made' basis) * Include Fully Retroactive Run-Off Cover * Be Underwritten by an RICS Listed Insurer ## Footnote These requirements ensure comprehensive coverage and protection for firms.
57
What does unlimited round-the-clock reinstatement mean?
In the event of a claim, each layer of insurance is exhausted, meaning it is then replaced so the firm is still covered ## Footnote This feature enhances the security of the insurance policy.
58
What are the minimum levels of indemnity required for firms?
* £0k - £100k = £250k minimum cover * £100.1k - £200k = £500k minimum cover * Above £200k = £1m minimum cover ## Footnote These levels are determined based on the firm's turnover to ensure adequate protection.
59
How do you forecast turnover for a new sole practitioner?
Calculate the total revenue anticipated in the first accounting period/year of trading by estimating the number of projects and the average fee charged ## Footnote Estimation is critical for determining the appropriate level of indemnity.
60
What is uninsured excess?
The amount of any claims which a member or firm may be required to pay before indemnity is granted, under the insurance policy terms ## Footnote This can affect the financial liability of the firm in the event of a claim.
61
What are the RICS Maximum Levels of uninsured excess?
* £10m or less = The greater of 2.5% of the sum insured or £10,000 * Above £10m = No maximum ## Footnote These limits help firms understand their financial exposure in relation to uninsured claims.
62
What is a complaint?
An expression of dissatisfaction
63
What does the RICS say about a CHP procedure?
Must be in line with the RICS standards for CHP Must have an Alternative Dispute Resolution Procedure Must publish a CHP Must be tracked and logged
64
What is an Alternative Dispute Resolution?
If the parties cannot agree / resolve a complaint, then an ADR should be used For example, Arbitration, Adjudication This provider must also be approved by the RICS Standards and Regulations Board. (SBR)
65
Who is the ADR provider listed under AtkinsRéalis’ CHP?
RICS Dispute Resolution Service (DRS) Ranges from Adjudication, Arbitration and Mediation
66
What other ADR procedures are you aware of?
Chartered Institute of Arbitrators Construction Industry Council Centre of Effective Dispute Resolution
67
What is the RICS Complaints Handling Procedure?
2 stage process Complaint is acknowledged within 7 days of receipt and passed onto the CHP appointed person in the business Complaint is responded to in full within 28 days of receipt. 2nd Stage Gives the client the opportunity to have your complaint reviewed and considered by an independent redress provide
68
What does the RICs provide for guidance on CHP?
Refer to the flow chart of a claim on the Complaints Handling Professional Standard issued by the RICS
69
What is a complaints log?
A complaints log tracks a complaint, outlining when it was received, acknowledged and responded to along with the outcomes.
70
Why is a complaint handling procedure important to a firms PI policy?
PI policy can detail requirements for CHP Failure to have a proper CHP in place may compromise the cover that is being provided.
71
How do you deal with a complaint?
Make my line manager / appointed complaints handler of the company aware Find out more about the complaint and whether I can resolve the issue Acknowledge the complaint and make sure that it is a formal complaint they are making
72
What is modern slavery?
Modern slavery is the exploitation of people for a personal or commercial gain. It is a human rights violation
73
What legislation are you aware of in relation to Modern Slavery?
Modern Slavery Act 2015 Punishes against modern slavery, trafficking and exploitation Provides guidance on the avoidance and help for those exploited.
74
Who must produce a modern slavery and human trafficking statement?
All companies carrying out business in the UK with a total annual turnover of £36m or more
75
What is a modern slavery and human trafficking statement?
Outlines what a company has in place to prevent modern slavery and human trafficking Produced and updated annually
76
Types of modern slavery?
Human Trafficking Forced labour Debt labour – owing money to people
77
In your job role, how can you identify modern slavery?
Looking at workers on-site Checking that workers are not travelling in large groups (coaches etc) Check that workers look healthy
78
If a company does not comply with the Modern Slavery & Trafficking Statement, what can happen?
The secretary of state can seek an injunction through the high court Court order if they then fail to comply
79
What guidance are you aware of in relation to Handling Client Money?
Client Money Handling – Professional Statement (2019) Client Money Protection Regulation 2019
80
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Client Money Handling – Professional Statement (2019)
81
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82
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The rules of RICS Client Money protection scheme
83
What are the key objectives of the client money professional statement?
1. Keep client money safe 2. Client accounts are used for appropriate purposes only 3. RICS-Regulated firms must have the appropriate controls and procedures to safeguard client money
84
What is client money?
Client Money is money that a RICS-Regulated firms holds for, or receives on behalf of another person. Not immediately payable
85
How is client money stored?
Held in a client bank account In an account in the name of the RICS-Regulated firm, or a wholly owned subsidiary of the firm.
86
What is a cashbook?
An accounting record that shows all drawdowns from the client account and the running balance
87
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An accounting record that shows all drawdowns from the client account and the running balance
88
What does the RICS (Rules of Conduct) say about client money handling?
Rule 1 of the New Rules of Conduct – Firms must keep client money safe and have the appropriate controls and procedures in place
89
Must ensure they are signed up to the RICS Money Protection SchemeWhat are the overall mandatory requirements of RICS Regulated firms when handling client money?
Must ensure they are signed up to the RICS Money Protection Scheme Must adhere to professional statement and keep client money safe Principal of the firm must ensure all members are aware of the rules and adhere to them
90
What is the purpose of the RICS money protection scheme?
To allow RICS Regulated firms to offer client money protection in accordance with the rules of conduct
91
*
To compensate clients of a RICS-Regulated firm for the losses resulting from the RICS-Registered firm failing to account for client money to the person entitled to it. It allow RICS Regulated firms to offer client money protection in accordance with the rules of conduct
92
What must firms ensure when holding client money?
Provide all details in relation to the account to the client in writing Use only for client services Make sure money is immediately available Maintain a running balance (cash book) Client money must only be held in the account, no office money
93
What information must be provided in writing to the client?
Account details Name of Account Any conditions (high interest, etc) Advance clients that paying fees in advance for surveying services is not covered by the Money protection Scheme Copy of the firms written procedures for handling client money.
94
What must RICS-Regulated firms ensure in receipt of client money?
Obtain a receipt Ensure all money received is paid into the account promptly Make sure that money does not mix
95
How would you set up a client account?
Confirm in writing Open a bank account with the name of the firm and “client” Confirm bank conditions in writing Maintain a running balance Produce a cashflow Understand that the account must never be withdrawn Once services are complete, the account must be closed.
96
What is AtkinsRéalis’ policy on money?
AtkinsRéalis run a strict no cash policy
97
What is the maximum amount firms can accept in cash?
The Money Laundering, Terrorist Financing and Transfer of Fundings Regulations states 10,000 Euros, unless registered as a high-value trader with HMRC
98
If there is surplus money in the account, what should you do?
Try and return to the client / owner of the money If this cannot be completed within 3 years, then donate to charity
99
Give me some examples of client money vs office money
Client Money - Money held but due to be paid to contractors - Payment on account for costs - Interest on account Office Money - Monies paid in advance in respect of an agreed fee - Interest on client accounts (dependent on agreement)

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