Your views on RICS: What needs to change?

The RICS is more than a year into the process of applying all of the proposed measures from Lord Bichard’s review, as well as Peter Pereira Gray’s report into valuations, both of which used findings from extensive consultations with its members. However, the organisation has since been rocked by another internal row that resulted in the mass resignation of its standards and regulation board in June. The walkout was sparked by a letter that president and governing council chair Ann Gray sent to the board’s then-chair, Dame Janet Paraskeva. The RICS says the letter followed its internal protocols and policies. To gauge whether the SRB’s exit has reframed RICS members’ opinions on self-regulation and governing council structure at the organisation, EG conducted a survey to determine how members feel about the same issues now. The survey was answered by 318 participants, just over 90% of whom were RICS members. Around 4% were industry professionals who have never held a membership; 3.1% used to be members; and 2.5% were thinking of becoming a member. There were 466 comments. As a point of comparison, excluding in-person meetings and roundtables, the Bichard Review received 551 consultation responses, including 47 late submissions. Low confidence in governing council A 78% majority of professionals said they did not have trust or confidence in the organisation’s governing council – its highest governing body, tasked with strategic oversight on entry requirements into the profession, and the setting and enforcing of professional standards – in its existing structure. Of the 29 seats on the GC, eight were elected by members, while four were appointed by the GC. Nine hold uncontested seats that members were not able to vote on, while eight are empty. Their terms began in July this year. A 58% majority believed the RICS should not continue to self-regulate, and that a fully separate function should be set up to regulate the surveyor and valuer professions “The fact that there are eight vacant seats alone shows the lack of engagement members are prepared to have with the institution, which I suspect is due to a lack of belief in the leadership,” said a survey respondent. Another said: “The quantum of uncontested and vacant seats shows a lack of proportional representation from the membership. The RICS, however, cannot stand still and needs to improve while also expediently resolving this lack of representation. Wholesale review and consideration is required.” “In its past format, the GC evidently failed to govern the executive effectively,” said another respondent. “The new GC has yet to prove its effectiveness.” More than three-quarters (76.5%) urged the RICS to re-run elections for a new general council, which all members should have an opportunity to apply for. One industry professional said: “I believe the majority of seats should be elected. If insufficient votes are received then the posts should be temporary and each candidate should be given a short term to showcase what they can do before a further re-election.” Another called for “an openness to change and hence an incentive for people to stand”. “The unelected seats make the whole GC an utter joke after very, very weak marketing of the vacancies by RICS,” said another. However, others disagreed that the model requires an overhaul. “The RICS could do with more stability current rather than constant change,” said one respondent. “Unfortunately, the GC and how it operates is difficult to understand and will always be remote from members,” said another, adding: “How it is structured keeps on coming around. Few members care how it is structured as long as their RICS delivers the status of being a chartered surveyor and how each [member] can contribute to this.” More than three-quarters (76.5%) urged the RICS to re-run elections for a new general council, which all members should have an opportunity to apply for One respondent said: “Due process was followed in the election process. End of story. Stop the whining and let governing council get on with it.” Another wrote: “It’s a shame people who clearly have time on their hands are so quick to do down the RICS when they are clearly trying to change – they’re not so quick to put their money where their mouth is and step up to take the positions to help with that change.” Other commentators noted that governance issues have created an apathy among members that has placed the organisation under strain. “RICS have shown over recent years that the current system is unworkable, it is trying to be too many things to too many people,” wrote one participant. “Much of its governance is handled by volunteers from amongst the membership but due to past issues the level of engagement from members is very low. As a result it now struggles to get candidates to stand for board seats and other key roles. “Having a properly constituted and independent regulator would take a pressure off RICS that it is clearly unable to cope with, it would also help to restore trust and, therefore, engagement from members.” Split on self-regulation Industry professionals were more divided over self-regulation. A 58% majority believed the RICS should not continue to self-regulate, and that a fully separate function should be set up to regulate the surveyor and valuer professions. The remainder voted that an independently led function to regulate surveyors and valuers should stay within the RICS as a single professional body. It is clear that the independent-led organisation has failed, hence the reviews that have been carried out Several respondents preferred self-regulation but expressed a lack of confidence in whether it is working at the RICS following the SRB’s walkout. “It is clear that the independent-led organisation has failed, hence the reviews that have been carried out,” said one. “If, like they claim, it is working then surely all the issues that have occurred over the past few years and the resignation of the SRB wouldn’t have occurred. “For any organisation that has a scandal, they should be open to change and accepting of the members’ concerns especially for [a] fee to be in the organisation. Those who are in prominent positions should be there to represent the members’ best interests and concerns on change to legislation, standards and, if required, to be challenged on issues of governance.” “I believe that if the current mess within the RICS can be cleared up and the recommendations of the various reports be implemented fully then regulation could potentially stay within the RICS,” said another. “However… to improve outside confidence, it may be prudent to set up a separate regulatory function.” Some respondents were sceptical that the RICS will budge in this regard. “Recent executive pronouncements suggest that an element of self-preservation and of the status quo is evident,” said a respondent. One noted there “appears to be a conflict between the RICS as a commercial entity and a regulatory entity”, adding that “it makes sense to create separation but maintain close alignment”. “I firmly believe an organisation needs a strong and independent review panel,” said another. “Without compromise nor concerns over conflicts of interest (actual or perceived) having an arm’s-length regulation oversight feels appropriate governance.” Some disagreed. “Am arm’s-length regulation function within the RICS is likely to have a better understanding of the profession’s regulatory requirements and to operate more efficiently than a separate function,” one respondent said. Self-regulation “with a third way” was posited by one individual, whereby the RICS could engage “some high-quality independent external accreditation” of its policies and decisions reporting directly to members, initially on a six-month basis before moving to an annual basis when a stable platform is established. “Having worked as a chartered surveyor at a high level in the public sector, I have no confidence in direct government involvement, which I doubt will make things better and might make them worse,” said that person. “I also think that government involvement risks creating a conflict of interest with the RICS being compromised if it wishes to challenge or criticise government actions and policies.” Leaning towards government intervention Asked if the government should have the legal power to appoint an independent person to carry out a review of the RICS, as set out in clause 221 of the Levelling-up and Regeneration Bill, almost two-thirds voted in favour of more powers for the government to intervene. The remaining 35.4% disagreed. Despite the positives of Bichard, RICS has shown itself unworthy of the right to self-regulate Several said that before the SRB resignations, their responses would have been firmly against government intervention. “Despite the positives of Bichard, RICS has shown itself unworthy of the right to self-regulate. Allowing a situation to develop that led to the resignation of the entire disciplinary panel must be the final nail in the coffin,” said one professional. “There is no question that the RICS should be open to external review by government,” said another respondent. “The argument that RICS advances, that it should be free from ‘political’ interference, is self-serving nonsense. The fact that RICS uses members’ subscriptions to attend UK party conferences to lobby for changes in the law means RICS is deeply involved in the formation and implementation of environmental law. “RICS therefore must answer to the public, or its elected representatives, about the operation of the UK regulatory system for which it is responsible. The effort RICS has put into avoiding direct accountability to the British public is embarrassing and makes us a pariah among comparable professions, such as architects and engineers.” Some said that increased government powers would incentivise the RICS to act more efficiently. “Without the ability to refer up, there is no incentive to ensure full issues are dealt with timely, efficiently and effectively,” said a survey participant. “If a separate function regulates the RICS, then the government should not need to appoint an independent person to review the RICS,” said another. “Personally, I do not think the clause will affect the RICS’ nature to be an independent institution working for the market and the public as the trust is built on the work a public body does and the ethos it projects to the world outside,” said another. “Even if it’s not government then there needs to be something above it to prevent self-regulation as I do not think it is working for members.” Others believed government intervention was not the solution. “It may not be perfect but if the UK government steps in they will make a complete mess of it,” said one respondent. Another said: “All political bodies should be free of political interference.” The largest proportion, at roughly 45%, called for a fresh member consultation to seek views and check support for progress to date Disadvantages that were highlighted included that government-appointed reviews might lack the depth of understanding needed to evaluate industry-specific challenges; that political considerations would influence decision-making; an increased risk of delays in updating or adopting practices; and a lack of resources among government agencies. What should the RICS do next? Opinion was split over how the RICS should address issues around self-regulation and governing council structure. The largest proportion, at roughly 45%, called for a fresh member consultation to seek views and check support for progress to date, while around 32% called for an extraordinary general meeting to engage with members and seek votes of support. A further 12% said the RICS should continue to follow the existing plan and give it more time. One individual suggested that the RICS should consider approaching industry leaders with an invite to fill seats, adding: “Members are disengaged, so [at a] consultation the turnout will be so low, and as significant as an EGM sounds [it] will not carry much weight as nothing will change.” “More money spent on reviews isn’t good use of my subs,” said a respondent. “It’s been a period of major turbulence for so long, there needs to be a chance to see how the change works out, otherwise it’s just constant jumping from one thing to another.” Another individual said the RICS should seek views on methods to ensure greater membership involvement. “In my opinion this situation has arisen because the membership are disinterested in the institution because it is more interested in being a global organisation, rather than a body representing local members,” they said. A former RICS employee said the organisation needs to discard its “inward-looking” nature, where its focus on self-employed individuals and niche firms, as well as those who more actively participate with the RICS, has resulted in becoming “an irrelevance” to the major agents who “only see the benefit of their membership fees for getting their graduates through the APC”. “Until RICS becomes more relevant to the larger firms, apathy will remain and member engagement and enthusiasm will further dwindle,” they added. The RICS should take stock of the results of this survey, said another, adding: “Look for themes or patterns in views [and] then take results openly to members and look for consensus on how to proceed.” To send feedback, e-mail pui-guan.man@eg.co.uk or tweet @PuiGuanM or @EGPropertyNews Images © EG