The effectiveness of the South African Estate Agency Affairs Board code of conduct on the ethical behaviour of real estate agents

Abstract

The EAAB (Estate Agency Affairs Board), a statutory body for the South African real estate industry, introduced an extensive Code of Conduct in 1992. The research conducted will serve to determine whether this Code of Conduct is effective in ensuring ethical behaviour by real estate agents. Both qualitative and quantitative research was undertaken, whereby it was determined that there is indeed a level of unethical behaviour amongst real estate agents, that a majority of such agents were unable to interpret specific clauses in the Code of Conduct, and that there was no clear correlation between support for the Code of Conduct and moral intent. Qualitative interviews highlighted the various roles that stakeholders do and should play in training and enforcement of the Code of Conduct, and their insights helped provide the basis for recommendations to the Estate Agency Affairs Board on improving the effectiveness of the EAAB Code of Conduct. Key recommendations to the EAAB were that a revision of the Code of Conduct was needed, entry requirements into the industry should be more stringent, a professional image for the industry should be promoted, and improved communication between the EAAB and stakeholders, improved enforcement and higher penalties, and an extensive training and education programme on Ethics and the Code of Conduct were needed. A Ten Element Model for an Effective Code of Conduct was proposed that detailed ten key themes arising from the research which could also be applicable in other industries. The forces and importance of communication, debate and consultation between society and industry, through regulatory bodies and/or professional associations provided the foundation for the development and revision of the Code of Conduct. To ensure effectiveness, the Code of Conduct needed to be supported by an ethical culture, professionalisation of the industry, support and understanding of the Code of Conduct by stakeholders, exposure, education and training on the Code of Conduct and Ethics, enforcement, penalties and consumer education.