NAR Weighing Changes to Code of Ethics

Changes may be ahead for the National Association of Realtors and its long-espoused Code of Ethics.

An agenda for the trade group’s upcoming Legislative Meetings hints at the changes NAR is eyeing, Inman reported. An appendix to the agenda noted NAR’s risk assessment of its policies, which found an area of potential legal liability.

Currently, member brokers are barred from using “harassing speech, hate speech, epithets, or slurs based on race, color, religion, sex, disability, familial status, national origin, sexual orientation, or gender identity.” Disciplinary action could come from breaking that tenet — or any tenet — in the Code of Ethics.

Under proposed changes, “harassment” would be more clearly defined. Additionally, members would be encouraged to always follow the code’s principles, but disciplinary action would be reserved for conduct in professional or business settings.

These possible changes come as Texas lawmakers consider a bill that would stop trade organizations from denying membership to a person “because of the person’s exercise of the person’s freedom of speech or assembly, notwithstanding any provision of the association’s or organization’s bylaws.” It also allows an alleged victim of a violation to go after a trade organization for damages.

It’s not clear if the bill — which could impact NAR’s execution of its Code of Ethics — was top of mind when the proposed changes came about at the trade group. The Texas Association of Realtors took a neutral stance towards the bill.

NAR is also proposing requiring its members to advise clients that agent compensation “is not set by law and is fully negotiable.” Sitzer/Burnett is clearly at the heart of that amendment.

Leadership groups within the organization will weigh the proposed changes before the board of directors decides on ratification.

“With 1.5 million members across the country, we need to ensure the specific articles of the Code of Ethics are clear in their language and intent and can be enforced fairly and consistently,” NAR president Kevin Sears said in a memo to association directors. “Without this, the defensibility — and sustainability — of the Code itself is in doubt.”

— Holden Walter-Warner