Ethics in Strata

Recently I attended the SCA National Conference in Darwin and was charged with the responsibility of doing a session on Ethics in Strata Management. Giving a solicitor such a topic is dangerous! Many things are said about solicitors some of which isn’t very good (and in some cases well founded) but we are one of the most regulated industries in our Country.

Due to the role we play in business and peoples personal lives, our “ethics” need to be at the highest level. Anyway, enough about me, what about strata management.

Despite what others may think, ethics is an integral part of strata management and in my view it is no different to that of solicitors. It defines the principles that govern the decisions and actions taken by strata managers in promoting the interests of the owners and residents of a strata scheme.

However, like any other profession, strata management is not immune to ethical pitfalls, and managers must be aware of these pitfalls to avoid them.

In my presentation I spoke about many things but briefly the overarching issues were:

• Conflict of interest: Strata managers must ensure that their decisions are impartial and are not influenced by personal interests. For instance, if a strata manager also works for a company that provides services to the scheme, such as cleaning or maintenance services, they may be tempted to prioritise that company’s interests over the interests of the owners and residents. Strata managers must avoid such conflicts of interest and disclose any potential conflicts to the owners corporation.

• Transparency: Strata managers must ensure that they are transparent in their dealings with the strata community (known as owners corporation, body corporate, and strata company) and residents. They must keep accurate records of their activities and decisions and make them available to the strata community upon request. A lack of transparency can lead to mistrust and suspicion among owners and residents, and damage the reputation of the strata manager and the strata community.

• Lack of professionalism: Strata managers are expected to conduct themselves in a professional and ethical manner at all times. They must be respectful and courteous in their interactions with owners and residents and maintain a high standard of professionalism in their work. A lack of professionalism can damage the reputation of the strata manager and the strata community and can lead to conflicts and disputes.

• Lack of confidentiality: Strata managers must respect the confidentiality of owners and residents and ensure that any personal information is kept confidential. They must also ensure that sensitive information, such as financial records, is not shared with unauthorised persons. A breach of confidentiality can damage the trust and confidence of owners and residents and can lead to legal action.

• Lack of understanding of ethical principles: Strata managers must have a clear understanding of ethical principles and how they apply in the context of strata management. They must be able to identify ethical issues and apply ethical principles to make decisions that promote the interests of the owners and residents. A lack of understanding of ethical principles can lead to poor decision-making and damage the reputation of the strata manager and the strata community.

To avoid these ethical pitfalls, strata managers must adopt ethical practices and ensure that they are adhered to at all times. The following are some best practices that strata managers can adopt to promote ethical behaviour:

1 Adopt a Code of Conduct: Strata managers should adopt a code of conduct that outlines ethical principles and standards of behaviour. The code of conduct should be communicated to all owners and residents and should be regularly reviewed and updated. Luckily SCA across Australia and New Zealand have worked on the “Respect Pledge” and Codes of Conduct that we can all access and adopt.

2 Provide Regular Training and Education: Strata managers should provide regular training and education to owners and residents on ethical principles and their application in strata management. This can help to promote understanding and awareness of ethical issues and promote ethical behaviour. This is very relevant for committee members to understand their role in life.

3 Establish Clear Communication Channels: Strata managers should establish clear communication channels with owners and residents to ensure that their concerns and feedback are heard and addressed. This can help to promote transparency and build trust and confidence.

4 Ensure Impartiality: Strata managers should ensure that their decisions are impartial and are not influenced by personal interests. Any potential conflicts of interest should be disclosed to the strata community.

5 Respect Confidentiality: Strata managers should respect the confidentiality of owners and residents and ensure that any personal information is kept confidential. Sensitive information, such as financial records, should be shared only with authorised persons.

If for any reason you find yourself in an “ethical dilemma” look for help. Seek assistance from your manager, colleague, SCA or the relevant Government Department, or if you are concerned — call a solicitor……