Ethics:  Rules are Rules!  Or are they?

The appraisal profession professes to be ethical.  What does this mean?  Does it mean I follow certain rules – or does it mean I lead an ethical life – a behavior?

Let’s look.

We get our ethical rules from two basic sources: USPAP (Uniform Standards of Professional Appraisal Practice), and our professional organizations.  USPAP’s “ETHICS RULE” has sections:  Nondiscrimination, Conduct, Management, and Confidentiality.  Basically it means “don’t lie, cheat, or do any dumb appraiser tricks.”  Their five-page Ethics Rule of “don’ts” is quite detailed .

The list includes “ethical” requirements of “impartiality, objectivity, and independence.”  Also competence, record keeping, prior-services disclosure, advertising, and “reputation.”

The Appraisal Institute seems to focus on the “Canons”:  detrimental conduct, organizational duties, unbiased work, confidentiality, and advertising.  The American Society of Appraisers focuses on objectivity, competency, responsibility to clients, and avoidance of false conclusions.  The National Association of Appraisers basically references USPAP.

Editor’s Note: This is Part One of a new Series from George Dell.

Do this.  Don’t do that.  Rules.

The CAA (Community of Asset Analysts) simply follows the laws of technology, and the  transparency of the scientific method in “data science.”  A different, but effective set of rules and intentions.  Facts, logic, reasoning, visualization, and reproducibility.

But what is “ethics”?  Dictionary definitions say:   “Principles” of conduct, a “moral philosophy,” and “morally right behavior.”

Behavior

This is the issue.  Do we need ethical rules, or ethical behavior?  Rules require administrative regulations and punishment.

 Behavior presents rewards.

Ethical behavior means acting with internal honesty, integrity, fairness, responsibility, respect, compassion, and loyalty.  It builds trust, stability, better decision-making, strengthens relationships, and supports justice.

Internalized ethical behavior enhances an individual’s reputation and trustworthiness, promotes self-respect and mental health, brings less legal/financial risk, and fosters competitive advantage and profitability.  Personal gain.

Ethical behavior also benefits organizations (like those noted above).  It leads to better morale, stakeholder loyalty, less legal/financial risk, competitive advantage (like AVMs and other “alternative” products), and long-term survivability.  And Society benefits from foundational social stability/justice, economic growth, environmental sustainability, stronger communities, even global trust and cooperation.  Yes, it reveals itself as a public policy issue!  Government and ethics.  Aw shucks!

This is part one of what begs a deeper and broader discussion of a profession in trouble, the needs of society, and safe enablement of technology (especially AI).  I did not expect this, but it demands itself!

The motivating question we ask here is:  Should appraiser education emphasize the benefits and rewards of ethical behavior, or continue the punitive control of ethical “rules”?

Rules . . . or action.