http://www.ired.com/buymyself/agency/hekker-ba.htm
In a nutshell an Agent walks in the shoes of the Client. The Client's best interests must, by the Common Law of Agency, come before the interests of the Agent. For Example: an attorney can not represent 2 or more parties - that's why a law firm must do a "conflict check" before learning the reason why you are visiting that law firm; by their Code of Ethics, an attorney can not even give the appearance of a conflict of interest.

Now let's take that concept into the real estate industry. A Buyer's Agent must:

be licensed with the regulatory department of the State in which the licensee practices;
must establish the relationship between the Buyer and the Brokerage through a written agreement between them;
give the Buyer 100% loyalty and 100% confidentiality;
the BrokerAGE is the Agent, not the associate of the firm.
The marketplace has dramatically changed since the concept of Buyer's Agency became legal for the transfer of residential real estate.

In the beginning a small group of licensed real estate professionals established the principles and practices of representing only buyers in the purchase of real property and they called themselves: "Exclusive Buyer's Agents". They take no listings and therefore have no conflict of interests. They do not work for the Seller and are not paid by the listing Brokerage, because that would cause conflicts of interest. This concept was a threat to the traditional Brokerages because they had always controlled the listing and the disbursement of commissions.

However, as the concept of Exclusive Buyer's Agents grew and became desired and accepted by Buyers, the traditional Brokerages began to muddy the waters. They feared the loss of the "double dip" of collecting the commissions from both sides: the seller and the buyer. Additionally, some traditional Brokerages offer associates a bonus for SELLing an in-house listing. You see they are in the business of SELLING products.

The associate learns the secret motivations of the Seller and lists the property in their own firm's data base. Then the property is listed in the Multiple Listing Service (MLS), which is a membership of Brokerages who agree to "co-operate" in getting the property sold. It may not be an agreement for compensation to the Brokerage that brings the Buyer. Why? Because the Listing Contract between the Seller and the Selling (Listing) Brokerage is a private contract and all commission money goes to the Selling (Listing) Brokerage.

Read the whole text HERE