ETHICS AS INEVITABLE TOOL FOR SUSTAINABLEREAL ESTATE PRACTICE

Ilo Ndubueze Benneth

INTRODUCTION
Ethics is a branch of philosophy that deals with morality. Ethics is concerned with distinguishing between good and bad in the society, between right and wrong human activities and between virtuous and non-virtuous character. It is the most important aspect of any profession.

Ethics is who you are and not what you do. It is a product of the person’s character.

The question of Business and Professional Ethics has become one of the hot and pertinent topics today. People, families, groups and nations have been betrayed and ruined both physically, financially and psychologically by the unethical conduct of people they have reposed so much trust and confidence. Some organizations have gone into bankruptcy because of unethical and integrity failures e.g. Enron Cooperation (Intentionally used faulty accounting practice that inflated their income figures).

Whilst the perpetrators may have enjoyed in the short run, they soon lost everything when nemesis caught up with them, they lost their companies, monies, stolen and accumulated, properties and assets, reputation, admiration and respect of people, friends and freedom, peace, positions and the opportunity of creating a lasting legacy.

The sort of unethical conducts being witnessed today was unthinkable 10 – 15 years ago. Men are inventing ingenious ways of perpetrating the dubious schemes. If deliberate effort are not made to address the issues of Ethics and corporate governance things are going to get worse because every successive generation always tends lower the standard.

Business cannot be sustained where the human resource organization do not subscribe to International best practice. The culture of focusing on money rather than adding value must be eliminated from psyche.

Reason for Unethical Behaviour
a. We do what’s most convenient. An Ethical Delima is when we make an undesirable choice relating to moral principle or practice. For example a man that keeps the same salary account with his wife, found, whilst taking a walk one early morning, an envelope containing $10,000 USD. The Moral Question was “should he tell or declare to his wife this extra income since it is not from his salary”? Will he have the courage to do the right thing?

b. People have become self-centered and selfish and winning at all cost is the order of the day. The ends now justify the means. Personal moral issues of honesty, faithfulness, truthfulness; integrity have largely been thrown to the dustbin. “Just get the money” seem to be the battle cry. The hypocrisy of it all is that people know what is right and what to expect from people but not themselves. People judge themselves by their own good intentions and others by their worst action. People who have themselves Ethical and Moral issues demand better conduct for Government and Politicians.


c. The belief that they can get away with the misconduct or malpractice.

d. Greed and Selfishness

e. The desire to make quick and fast money.

SOME STIPULATIONS CONTAINED IN THE NIESV CODE OF PROFESSIONAL ETHIC AND PRACTICE

Article 9.2 of the Code of Professional Ethics and Practice stipulates that members who are principals shall be personally responsible for acts and omissions of the Partners and staff of the firm or company or partnership so far as they relate to matters coming within the scope of their professional practice.

Section 14: INDUCEMENTS FOR THE INTRODUCTION OF CLIENTS
Section 15:7.​A member shall always exercise due restraint in criticizing another member’s work in public or before a client.
Section 15:8.​A member shall not take over the work of another member for the same client, until he has either obtained the consent of such member has been formally notified by the client that the connection of such Member with the work, has been terminated.
Section 15:9.​No Member shall knowingly compete on the basis of professional charges with another Member for instruction from a client.

SECTION 18. CONFIDENTIALITY OF CLIENTS AFFAIRS
(a) No Member shall, without his client’s consent, disclose personal information concerning that client except as many be required by law.
(b) For the purpose of this Code “Personal Information” shall include any information relating to the property investment, financial or business circumstances of any person or body, or any other information of a sensitive nature which has been disclosed to the Member in his professional capacity, and is not known to be otherwise generally published.


COMMON UNETHICAL PRACTICES IN THE CASE OF VALUATION

1. NON-COMPREHENSIVE IN INFORMATION GATHERING.
   Either out of laziness, ignorance, incompetence or deliberate mischief, a surveyor will omit or neglect to gather all the relevant information relating to the subject asset being valued. A surveyor must crosscheck against the records obtained from the client details such as beacon numbers, dimension of the plot along the perimeter, shape of the plots, details of adjoining plots or important landmarks which would directly affect the integrity an accuracy of the valuation exercise.
   In the case of plant and equipment, where invoices are supplied by the client, the serial Nos, engines No, year of production and model of the machine must be checked for correlation.
   A valuation report is only is only as good as the integrity and competence of the person writing the valuation because Valuation in Nigeria at the moment is subjective owing to the imperfections in the property market.
2. OVER VALUATION
   The job of a surveyor is to interpret the market which is a reflection of the interplay of the demand and supply forces at the time of valuation and determine values of particular assets being valued; and not to allocate figures. A Surveyor should never “allocate” figures to any asset in a valuation either out mental laziness, or the desire to help the client achieve his objective no matter how close the client is or promise of a financial reward. Never assume that nothing will happen because you may be called upon to answer for that valuation opinion expressed. So all those surveyors whose responsibility it is to endorse valuation report on behalf of the firm must ensure that the opinions of values expressed by field officers are within acceptable margins.
   Surveyors must conduct price and comparable value surveys. Talk to colleagues and agents who have experience in certain markets to assist you put up a credible valuation report before endorsing.
3. UNDERVALUATION
   The consequences and implications of an undervaluation are as serious as overvaluation. Whereas on the one hand the mortgage more in a transaction, it could rob clients of Millions and Billions of Naira where a fair market value is not assented. That could be in the case where persons may have arranged to buy off a property at a ridiculously low prices as in the case of foreclosure and they need your valuation report to authenticate the process. You expose yourself to litigation for the wrong advise with huge consequential damage.
4. NON-INVOICING OF FEES
   A standard procedure for fee Billing is to officially type a fee note in Triplicate, one copy each for the customer, Valuation Department Fee File and the Accounts Department. This help to track delinquent client.
5. A practice where valuation transactions are done verbally should be completely discouraged.
6. Withholding part of the fees and whatever pleases.
7. Receiving payment for fees through staff personal account. This is a failure of character test and should never be condoned.
8. Unwarranted demands for P.R payments. There have been reported cases of surveyors filling for P.R which the surveyor intends to appropriate personally.
9. Asking for Gratias from clients outside the fees already paid.
10. Personal, private, practice within the office using all the office facilities but the transactions never accounted for. In most cases such valuation reports are deleted from the system with the surveyor perhaps having his personal soft copy record of such valuation.
11. DIVERSION OF VALUATION ASSIGNMENT
    There have been reported incidence in the past where a valuation officer have diverted jobs meant for the office to another firm and convincing their client that there is a working collaboration with the third party frim; on a personal fee sharing arrangement with the other firm.
12. QUID PRO QUO ARRANGEMENT
    This simply refers to a “this for that” proposal particularly from male sources of instruction to our female officers or even vice versa. We reiterate the passion of the Partners to grow the firm quickly and take it to the next level but not in that manner.

CONSEQUENCES OF UNETHICAL CONDUCT
Unethical conduct could lead to significant legal and financial penalties. It can severely damage institution/firms reputation and credibility with clients. It fosters toxic culture, erodes morale loss of public credibility and creates an environment of mistrust and conflict.

HOW TO PREVENT UNETHICAL BEHAVIOR
1)​Setting realistic goals for employees to meet
2)​Create policies and practices which promote good ethical behavior
3)​Train people on good ethical behavior by implementing training session on a regular basis to maintain strong ethical behavior.
4)​Build corporate culture that is based on communication, openness and transparency.

The issues of unethical conduct amongst practical surveyors has assumed alarming proportion and may spell doom for the institution that prides itself as a noble profession if it remains unchecked.