Guide to Professional Ethics - Statement 1.211: Obtaining Professional Work

(Revised with effect from 1 November 2001)

This Statement applies to all members in practice including affiliates, member firms and employees of member firms. Member firms are reminded that they are responsible for the professional conduct of non-members. The Statement should be read in conjunction with Statement 1.200 - Introduction and Fundamental Principles and the section of the Guide on Definitions.

Practice Promotion

1.0 Subject to the guidance which follows, a member or member firm may seek publicity for its services, achievements and products and may advertise his services, achievements and products in any way or by any means consistent with the dignity of the profession in that it should not project an image inconsistent with that of a professional person bound to high ethical and technical standards. A member firm and its principals are responsible for any promotional activities carried out by its principals or employees, or on its behalf.

Consultation

2.0 If a member lacks the relevant skill and/or experience in relation to an element of an engagement, he should seek advice from one who does (the consultant). Where a member consultant is consulted by a member in practice for his advice, he (or any practising member firm with which he is associated) should not, without the consent of the member who has consulted him, accept work from the client for which the consultant was instructed for a period of one year from the conclusion of the consultation. The same considerations apply where a member in practice introduces a client directly to the consultant.

Advertising

3.0 Advertisements must comply with the law and should conform as appropriate with the requirements of the British Code of Advertising Practice, and the ITC and Radio Authority Code of Advertising Standards and Practice, notably as to legality, decency, clarity, honesty and truthfulness.

3.1 The preceding considerations are of equal application to letterheads, invoices and similar practice documents.

3.2 If reference is made in promotional material to fees or the basis on which fees are calculated, the greatest care should be taken to ensure that such reference does not mislead as to: the precise services to be covered, and the basis of current and future fees.

3.3 Where members seek to make comparisons in their promotional material between their practices or services, including fees, and those of others, great care will be required. In particular members should ensure that such comparisons:are objective and not misleading, relate to the same services, are factual and verifiable, and do not discredit or denigrate the practice or services of others.

Particular care is needed in claims of size or quality. For example, it impossible to know whether a claim to be "the largest firm" in an area is a reference to the number of partners or staff, the number of offices or the amount of fee income. A claim to be " the best firm" is subjective and cannot be substantiated.

3.4 Obtaining investment business, including investment business corporate finance work is regulated under the Financial Services Act 1986.

3.5 A member or member firm may offer a free consultation at which levels of fees are discussed.

Disparaging statements

3.6 Promotional material may contain any factual statement the truth of which a member or member firm is able to justify but should not make disparaging references to, or disparaging comparisons with, the services of others.

Harassment

3.7 A member or member firm should never promote or seek to promote his services, or the services of another member or member firm, in such a way, or to such an extent, as to amount to harassment of a potential client.

3.8 It should be noted that special rules apply in relation to the conduct of Insolvency Practice and licensed practitioners should have regard to the relevant legislation, and to Statement 1.202, Insolvency Practice. Similarly, where member firms are registered for the conduct of investment business members should have recourse to the Investment Business Regulations, in particular (Regulations 3.04 to 3.12 and Schedule 2).

Payment for Introductions

3.9 For work, other than insolvency, members or member firms should not give, share or offer any commission, fee or reward to a third party, (other than an employee), in return for the introduction of a client unless:-

  • the client is aware of the arrangements with that third party, and in particular with regard to payment for introductions, and
    1. either the third party is a member of a body which has prescribed ethical standards comparable to those set out in this Guide or
    2. the third party complies with ethical standards comparable to those set out in this Guide and the member or member firm accepts responsibility for ensuring that the introduction is carried out in accordance with such standards.

In the case of insolvency work, Insolvency Practitioners should have regard to Statement 1.202, Insolvency Practice, specifically paragraph 26.0.

Members should have regard to the fact that, when in a fiduciary relationship with a client, commission however earned belongs to the client and can only be disbursed according to the client's directions (see Statement 1.314, Accounting for Commission).

Fundamental Principle 1 - "Integrity"

A member should behave with integrity in all professional and business relationships. Integrity implies not merely honesty but fair dealing and truthfulness. A member's advice and work must be uncorrupted by self-interest and not be influenced by the interests of other parties.

Fundamental Principle 2 - "Objectivity"

A member should strive for objectivity in all professional and business judgements. Objectivity is the state of mind which has regard to all considerations relevant to the task in hand but no other.

Fundamental Principle 3 - "Competence"

A member should undertake professional work only where he has the necessary competence required to carry out that work, supplemented where necessary by appropriate assistance or consultation.

Fundamental Principle 4 - "Performance"

A member should carry out his professional work with due skill, care, diligence and expedition and with proper regard for the technical and professional standards expected of him as a member.

Fundamental Principle 5 - "Courtesy"

A member should conduct himself with courtesy and consideration towards all with whom he comes into contact during the course of performing his work.

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