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  Real Estate Business Ethics in Effective Governance

"Effective governance by the board of a nonprofit organization is a rare and unnatural act. Only the most uncommon of nonprofit boards functions as it should by harnessing the collective efforts of accomplished individuals to advance the institution's mission and long-term welfare."

From "The New Work of the Nonprofit Board" in the September-October 1996 issue of the Harvard Business Review

The above quote speaks to the theme of the leadership of The RealtyU® Network. While the Network is not a "not for profit" organization, it is a network of member organizations and the Board of Governors views their role as a need to create a strong Network to help the accomplish the member's organizations mission.top quality career education in real estate and related fields.

"Today's challenge is to create corporate cultures that encourage and reward integrity, as much as creativity and entrepreneurship. To make this happen, executives need to be the moral compass for stakeholders and take personal responsibility for corporate shortcomings. CEO's must be willing to share governance responsibility with the board and the board should be vulnerable to the stakeholders."

"BusinessWeek concludes that the best insurance against crossing the ethical divide is a roomful of skeptics. CEOs must actively encourage dissent among senior managers by creating decision-making processes, reporting relationships, and incentives that encourage opposing viewpoints. By advocating dissent, top executives can create a climate where wrongdoing will not go unchallenged."- John Agno, Personal Corporate Coach

The RealtyU® Board recognizes its role and continues to strive to bring the best programs and systems forward for the Network membership. Part of that effort is the knowledge that RealtyU® has a strong belief in ethical practices in education. The members of the Network all subscribe to a method of business that is based on fairness to all concerned. RealtyU® helps build on that premise.

The RealtyU® Network mission Statement speaks to that point and in summary says:

To promote real estate education through ethical business practices, to serve that growing community of real estate professionals striving to live and work in responsible ways by keeping informed and learning the newest techniques through our Network membership, and to help continue the growth of financially healthy network member organizations in the process.

Our members recognize the importance of diversity in real estate and encourage equally all students to enter the business and to succeed with tools they learn from us. The RealtyU® Network of accredited schools and educators subscribe to the laws and approved practices of the Federal government and state or provincial laws that apply to the real estate industry.

As the first major contact with the real estate industry we realize how important it is to be able to "Talk the talk and walk the walk!" We strive to bring an ethical approach to the real estate business through all of our teaching and materials. In this regard we have developed the following approach to real estate education by retaining a relationship with the Council On Certification and Accreditation (COCA).

COCA has worked with numerous professions and industries to help form specific guidelines for real estate education organizations. A certification program has been established and several of the schools of The RealtyU® Network have been certified by the organization. What does certification involve? The following information details the RealtyU®/COCA Project.

Certification

It represents a collaborative and cooperative form of policy making between a profession or industry and its publics where the criteria for success may be measured by compliance with voluntary standards without the red tape and cost of direct government control. And most important, it works, as can be seen in so very many professions and industries.

The Policy Issues

Professional certification or accreditation requires attention to the:

·         Roles of key players (stakeholders)

·         Representation of their interests

·         Design and performance of the system of initial requirements

·         Monitoring of the program

·         Enforcement of the standards of practice followed by the certified or accredited members

Certification for professionals or accreditation of firms can affect public policy. Therefore, scrutiny of how key decisions affecting the public are made as part of the process is critical. Accountability, legitimacy, and openness must be important concerns in the development of certification programs.

The standard definitions on the following page will be helpful in working through the concept of professional certification.

CERTIFICATION: A process whereby an individual is tested and evaluated in order to determine the mastery of a specific "Common Body of Knowledge," or some portion of that same "Common Body of Knowledge." It also includes meeting other standards established by the granting body. Standards such as minimum formal education requirements, specific educational requirements relating to the body of knowledge, minimum experience requirements, and the agreement to conduct their professional activities under a prescribed set of standards of practice.

Other requirements usually include the completion of a prescribed number of professional or renewal education credits within a specific number of years to maintain the certification.

ACCREDITATION: A process by which an association, professional society or agency evaluates and recognizes a program of study, institution or organization as meeting certain predetermined standards or qualifications. It may apply to entities and their programs of study or the services they provide. It may also apply to the granting of accreditation to an organization, which has met specific requirements as established by a professional organization.

The potential for accreditation leads to another realm of opportunity for professional organizations and societies. Accreditation can be made available to companies who meet additional requirements as established by the certification entity. Such requirements might include having a certain percentage of their management with current professional certification, normal academic accreditation requirements, support staff with current professional certification (if appropriate), strict adherence to professional standards, or any other logical requirements which might be added to a credible accreditation program.

STANDARDIZATION: A process by which a certified education professional would be measured against a set standard of performance or quality. This allows for the constant monitoring of success of the designated individual.

CODES OF CONDUCT: A statement of standards of practice describing expectations about behaviors of certification program participants is necessary. In most cases, it delineates acceptable professional behaviors, and frequently includes a process for enforcing such expectations (e.g., sanctions, fines, and expulsion from membership in the certifying body).

What Are the Necessary and Sufficient Conditions for Success?

It appears that the following factors are the most critical in the initial approval, development and ongoing success of a professional certification system.

First, the profession, via key individual stakeholders, must recognize the need for self-regulation in the form of professional certification. The ability to convince others of the need is vital. Their leadership vision must convince the remainder of the community of the importance of this issue.

Second, the profession must have the capacity for self-regulation. (This can only be accomplished through an independent third party organization. This organization must be a fully credible entity. Credibility issues include adequate financial resources, staffing, membership interest and, of course, a well-developed implementation and management plan for the program.

Third, an individual leader or champion is needed to play a pivotal role. (The individual embodies the cause and serves as a technical resource; political scout, committee member and liaison to the network needed to bring all the resources to bear on the project. He or she becomes the "paradigm shifter" the visionary for certification by the organization.

Fourth, the structure (legal and organizational) is key . Long-term legal concerns are real and must be carefully considered in the design, organization and administration of a program.

In general, the better professional certification programs have common elements:

·         Formed on a specific set of issues

·         Represent organization learning and adoption; shows response to new issues and concerns by cautious review and adaptation

·         Supported by members

·         Have a track record of success built over time

·         Willing to address the tough issues and "go to the mat," if needed

·         Endorsed by government (if appropriate) via advisory opinion or their form of approval or legitimacy

With these ideas in mind, consider the following reasons professional societies become involved in the self-regulation process:

·         Provides public awareness of interest in professionalism

·         Assures minimum level of competency among membership

·         Reduces need for governmental control over membership

·         Allows for updating of professional education to take place in a logical manner

·         Creates a feeling of self worth in members who have achieved the certification

·         Creates an additional reason for membership in the parent organization

·         Provides service to existing membership of the organization

A carefully designed, and managed professional certification or accreditation program serves as a useful alternative for encouraging forms of desirable and productive behavior on the part of members of any organization, industry or profession. COCA is pleased to have an on-going role in the development of this program with RealtyU®.

All approved and accredited schools and educators of The RealtyU® Network are members of the Real Estate Educators Association (REEA). Three of our members are past national presidents of the REEA and during those periods helped form what is today the generally accepted "rules of the road" for real estate education. (Let's look at these rules in greater depth.

Generally Accepted Principles of Education
Adopted by The REEA Board of Directors 1990 - Revised 1994.

Category: KNOWLEDGE

Instructors should:

1.       Provide current information

2.       Present alternative viewpoints on material when there is not a single position that is accepted industry wide.

3.       Clearly identify opinions as the instructor's opinions.

4.       Build a proper foundation for each major element of a subject.

5.       Deal with all key elements of a subject.

6.       Cover the material adequately in the allotted time.

7.       Answer all questions logically and concisely.

8.       Be informed enough to handle a variety of questions on the subject being taught.

9.       Admit when he/she does not know the answer to a question and volunteer to obtain the information.

10. Focus on students gaining knowledge, not on impressing the students with the instructor's knowledge.

Category: ANDRAGOGY

Instructors should:

1.       Present new ideas by relating them to preexisting knowledge held by the learners.

2.       Teach at the learner's level.

3.       Show in a specific way how new material will benefit learners.

4.       Encourage questions and motivate involvement.

5.       Show tolerance -- both to ignorance and disagreement thus avoiding arguments and confrontation.

6.       Build learner's self esteem.

7.       Call learners by name.

8.       Involve learners in the learning process through planned activities.

9.       Use a variety of teaching methods.

10. Teach to all participants, not just to those who show interest.

11. Present key points by using examples as illustrations.

Category: SPEECH

Instructors should:

1.       Use concise, simple, and normal speech patterns, use simple terminology.

2.       Not read to the class.

3.       Keep the presentation on pace thus finishing the material in the allotted time.

4.       Keep the topic flowing.

5.       Speak loudly enough to be heard by all.

6.       Enunciate clearly without being overdone.

7.       Restate an individual learner's question to the group as a whole prior to attempting to answer the question.

8.       Use humor when appropriate to make a point.

Category: TEACHING AIDS

Instructors should:

1.       Make sure materials are legible, correctly spelled, properly numbered and mechanically produced using readable typeface.

2.       Use visual imagery when possible to enhance written words.

3.       Use written words when possible to enhance oral speech. NOTE: Written is better than oral; visual is better than written.

4.       Follow the prepared outline.

5.       Make sure that all material on the outline will be covered in the class and none of it is extraneous.

6.       Deviate from prepared material only to meet specific needs.

7.       Arrange the classroom so that learners do not have to look through physical objects.

8.       Use modern presentation equipment such as overhead projector or computer projection.

9.       Use equipment that enables the instructor to remain looking at the learners rather than turning back to the class to write.

10. Make sure that the physical stature of the instructor does not block the view of the learners toward the projected material.

11. Make sure that the projector screen is easily visible to the group as a whole.

12. Use color.

13. Use large images for projected material.

14. Turn the projected image off when not in use and on to recall attention to the material.

15. Never block the image by walking between the projector and the screen with the projector on.

Category: LEARNING ENVIRONMENT

Instructors should:

1.       Be positive toward the subject matter.

2.       Refrain from ridiculing either the learners or others.

3.       Wear professional attire.

4.       Attend to personal grooming.

5.       Set up the room to accommodate the approximate number of learners expected to attend.

6.       Make sure to keep empty seats at a minimum.

7.       Make sure that a lectern or table at front of room is unobtrusive.

8.       Provide writing surfaces for learners.

9.       Make sure that learners have ample space between seats.

10. Not stand behind physical objects for more than a short time period.

11. Use gestures during the presentation.

12. Use physical movement during the presentation to minimize the physical distance between the instructor and learners and try to involve all learners equally.

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