Ethics, Rules of Conduct & Professionalism (L3) Flashcards
(59 cards)
1
Q
What does RICS mean?
A
Royal Institution of Chartered Surveyors
2
Q
When was RICS founded?
A
1868
3
Q
When did RICS get the Royal Charter?
A
1881
4
Q
What is a Royal Charter?
A
Legal recognition as a professional body
5
Q
What is a privy council?
A
Formal body of advisors to the Monarch
6
Q
RICS address?
A
12 Great George Street, Parliament Square
7
Q
RICS motto?
A
Est Modus in Rebus (There is measure in all things)
8
Q
RICS Mission Statement?
A
- To qualify and equip their members to the highest standards of professional service
- To promote and enforce standards
- Lead solutions to the major challenges facing the built environment through professional expertise
9
Q
What is Lionheart?
A
Independent charity set up by RICS, for RICS affiliates
10
Q
What is RICS Metrics?
A
Early career support
11
Q
RICS Governance Structure?
A
- Governing Council (Sets the overall strategic direction and objectives of RICS)
BELOW GC:
- RICS Board (Responsible for operational and business oversight and ensures the strategy from Governing Council is implemented.)
- Standards and Regulation Board (SRB) (oversees professional standards and regulatory functions)
(The Standards and Regulation Board is accountable to the Governing Council, but is not directed by them)
12
Q
Key People at RICS
A
Governing Council:
Acting President and Acting Chair = Mick McLean
Old President = Justin Sullivan (Stepped aside March 25, following expert witness case)
Executive Board:
CEO = Justin Young
Standards and Regulation Board
Chair: Nigel Clarke
13
Q
What is the Levitt Review?
A
- Alison Levitt’s investigation in 2021 to explore governance failures within RICS in 2018/2019.
- Key findings include unfair dismissal of non-exec directors and sound governance principals were not followed
14
Q
What is the Bichard Review?
A
- Lord Michael Bichard’s review to assess RICS purpose and governance, following results from the Levitt review.
- Key recommendations include: Increase D&I, simplify governance structure and increase focus on public interest
15
Q
What is the role of the Standards and Regulation Board?
A
- Maintains and enforces professional standards.
- Regulates members and firms.
- Acts in the public interest.
- Oversees disciplinary processes.
- Operates independently from RICS’s commercial functions and reports directly to the Governing Council
16
Q
RICS Rules of Conduct. What is Rule 1?
A
Members and Firms must: Be Honest, act with Integrity, and comply with their Professional Obligations, including obligations to RICS
17
Q
RICS Rules of Conduct. What is Rule 2?
A
Members and Firms must: Maintain their Professional Competence and ensure that services are provided by Competence Individuals who have the necessary expertise
18
Q
RICS Rules of Conduct: What is Rule 3?
A
Members and Firms must: Provide Good Quality and Diligent Service
19
Q
RICS Rules of Conduct: What is Rule 4?
A
Members and Firms must: Treat others with Respect, and encourage Diversity and Inclusion
20
Q
RICS Rules of Conduct: What is Rule 5?
A
Members and Firms must: Act in the Public Interest, take Responsibility for their actions and act to Prevent Harm and maintain Confidence in the Profession
21
Q
Explain the general overview of the New Rules of Conduct 2022
A
- A simplified set of 5 clear rules for all members and regulated firms
- Applied globally and promotes ethical behaviour, competence and public trust
- Supported by Appendix A (Professional Obligations) and guidance
- Replaces the old rules to be more accessible, modern and principle based
22
Q
What is included within Appendix A?
A
Key professional obligations for members and firms, including:
- CPD
- Complaints handling procedures
- PI
- Handling clients money
- Advertising and use of RICS designations
- Cooperation with RICS regulatory functions
23
Q
Give an example of one Rule of Conduct that you comply with every day?
A
One rule I comply with every day is ‘Act with Integrity’. This underpins all of my professional decisions
For example, I ensure transparency and honesty when advising clients, whether that’s managing expectations on cost, programme or potential risks
24
Q
What does a firm need to do to register with RICS?
A
- Register with RICS
- PI Insurance
- Complaints handling procedure
- Systems for handling clients money
- Nominate a responsible principal
- Adhere to the Rules of Conduct
- Maintain ethical and professional standards
25
List the required PI levels?
Based on Fee revenue:
- Below £100,000 = £250,000
- £100,000 - £200,000 = £500,000
- Over £200,000 = £1,000,000
Maximum Level of Uninsured excess:
- Either 2.5% or £10,000, whichever is greater
26
When are firms required to register with RICS?
When:
- the Firm provides surveying services to the public
- the Firm is operating in Regulated Area A
- at least 50% of the Firm's Principals are RICS Members
27
When are firms eligible to register with RICS?
When:
- the Firm provides surveying services to the public and;
- at least 25% of the Firm's Principals are RICS Members
28
What are the Continued Professional Development (CPD) requirements?
20 Hours a year. 10 Formal, 10 Informal
All members must maintain a relevant and current understanding of RICS professional and ethical standards on a 3-year rolling period
Use CPD Tree - A framework showing examples of structured and informal CPD
29
What is PI Insurance?
PI Insurance = Professional Indemnity Insurance
- Protects clients and the public from financial loss due to professional negligence
- Protects the firm from the cost of defending claims and paying damages
- Mandatory under RICS Rules for all regulated firms
- UK professional indemnity insurance requirements - Version 10 2024
30
What is Run-off PI?
Run-off PI insurance provides cover after a firm stops trading, for claims that may arise from past professional work.
- Required by RICS for at least 6 years (if under-hand contract)
- Required by RICS for at least 12 years (if signed as a deed)
31
Merrett v Babb?
Relates to Run-off PI.
A valuation was deemed to be negligent and as the original company no longer existed and the PI had been cancelled, the court ruled Merrett could pursue the individual (Babb) for losses
32
How would you handle clients money?
- Adhere to the 'Clients Money Handling, 1st Edition' professional standard 2020
- Ensure a separate bank account
- Ensure account is clearly named as a client account
- Ensure the client has access at all times
- Ensure all interest gained is paid back to the client
- Ensure a ledger / record is kept up to date
- Ensure the account is never overdrawn
33
What is Conflict of Interest?
- Conflict of Interest occurs when obligations to one party are affected by obligations to another party, either professionally or personally
- Conflicts of Interest 2017 (1st Edition). Professional Standard
34
Types of Conflict of Interest
- Party Conflict
- Own Interest Conflict
- Confidential Information Conflict
35
What is the UK Bribery Act?
UK Bribery Act 2010 prohibits:
- Accepting a bribe
- Offering a bribe
- Attempting to bribe an official
- Failing to prevent a bribe
36
What are the 6 Principles of the Bribery Act 2010
1. Proportionality - Small firms have a smaller risk of Bribery etc.
2. Top-Level Commitment - Snr Management to ensure operating in a bribery-free environment
3. Risk Assessment - Companies must assess the risks associated with bribery in its operations
4. Due Diligence - Must be conducted when hiring staff or engaging with 3rd parties
5. Communication - Must communicate their anti-bribery policies
6. Monitoring and Review - Regular monitoring and review processes to assess effectiveness of policies
37
What is Party Conflict?
Occurs when a professional has conflicting duties or interests related to different parties involved in a Project
Example - If a PM is working for both the client and the contractor, there could be a conflict when interests do not align
38
What is Own Interest Conflict?
Occurs when a professional's personal interests interfere with their professional duties
Example - If a PM holds shares in a company that could benefit from a contract awarded
39
What is Confidential Information Conflict?
When confidential information is used inappropriately, either for personal gain or for the benefit of another party
Example - A PM accidently shares confidential financial information from a client with a competitor
40
What is Informed Consent?
Informed Consent occurs when a party who may be affected by a conflict of interest accepts the existence of that risk and continues to instruct a RICS regulated firm
41
What is the UK Bribery Act?
UK Bribery Act 2010 prohibits:
- Accepting a bribe
- Offering a bribe
- Attempting to bribe an official
- Failing to prevent a bribe
42
Explain the process for safeguarding clients interests in the event of death or prolonged illness of a sole trader?
- RICS requires firms to safeguard clients interests
- Ensure a succession plan is in place and has been documented
- Consider appointing a locum
- Notify clients
43
What is a locum?
A locum is a temporary professional employed to fill in for someone who is absent.
Needs to be a qualified and experienced professional
44
Name some relevant 3rd Party redress mechanisms?
- RICS Ombudsman Service (The RICS Dispute Resolution Service)
- Property Ombudsman
Both provide a complaints handling process if a resolution isn't achieved within a firm
45
Colliers Gifts, Hospitality and Entertainment policy?
- Under £30 - No Action
- £30 - £60 - Input details on register
- £60 - £200 - Input details on register and Line Manager approval
- £200+ - Input details on register, LM approval and Director approval
46
Rules on accepting gifts?
- Follow RICS guidelines: Ensure the offer is not excessive, and assess if accepting could create a conflict of interest
- Only accept reasonable hospitality that does not influence professional judgement
- Record the gift if accepted
- If in doubt, decline the offer
- Be aware of Bribery Act 2010
47
What are RICS Bye-laws?
RICS Bye-Laws are the legally binding rules that govern the structure and operation of the RICS. They are approved by the UK Privy Council under the institutions Royal Charter
48
What laws and regulations govern the formation and workings of RICS?
- Royal Charter and Bye-Laws governs RICS
- Regulatory Framework
- RICS Code of Conduct and various RICS Guidelines
49
What is Money Laundering?
The process of disguising the origins of illegally obtained money to make it appear legitimate
50
Money Laundering Regulations?
- RICS members must comply with the Money Laundering Regulations 2017
- Regs require members and firms to identify and report suspicious activities and to carry out Due Diligence
- Firms must have internal procedures to prevent money laundering and comply with record-keeping requirements
51
What are the key points on the Ethical Decision Tree?
- Do you have sufficient facts on the issue?
- Is it legal?
- Is it in line with RICS Rules of Conduct?
- Have you consulted with appropriate people to make an informed decision?
- Do you have clear reasoning in reaching your decision?
- Is your decision informed?
- Would you be content for your actions to be made public?
52
What are the 3 buzz words associated with Gifts and Hospitality?
- Proportional (should not be excessive)
- Appropriate (timing must be suitable)
- Transparent (be open about accepting gifts)
53
RICS have introduced new definitions for Professional Guidance. What are they?
Professional Standards - Set requirements and expectations from RICS members and regulated firms about how they provide services
Practice Information - Supplementary guidance to support surveyors in delivering specific services or working in specific areas of practice
54
Why do you want to be a chartered surveyor (MRICS)?
- RICS is the largest international property organisation in the world. By joining I will get global recognition and will become part of an international professional community.
- I will get unrivalled professional status, guidance, information and support
55
What is the RICS whistleblowing policy?
- RICS Whistleblowing Policy 2022
- Applies to all RICS employees globally, enabling them to raise concerns about malpractice, mistreatment or wrongdoing
- Implemented as part of the recommendations from the Levitt Review
56
What is the UK Bribery Act?
UK Bribery Act 2010 prohibits:
- Accepting a bribe
- Offering a bribe
- Attempting to bribe an official
- Failing to prevent a bribe
57
Types of Conflict of Interest
- Party Conflict
- Own Interest Conflict
- Confidential Information Conflict
58
What is the UK Bribery Act?
UK Bribery Act 2010 prohibits:
- Accepting a bribe
- Offering a bribe
- Attempting to bribe an official
- Failing to prevent a bribe
59
What is Modern Slavery
Modern slavery is the illegal exploitation of people for personal or commercial gain.
Modern Slavery Act 2015
