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What is today's blog about?
In this week’s blog, we look at the outcome of the RICS Independent Review by Alison Levitt QC. This is essential reading for all RICS APC and AssocRICS candidates, as well as qualified RICS Members.
What is the Independent Review?
The Independent Review was commissioned by RICS to investigate articles in the press that alleged that RICS ‘tried to supress a critical internal report into its finances in 2018/2019 and then unfairly dealt with those who sought to explore the issue’ (Levitt, 2021).
You can read the full 467 report here.
Alison Levitt QC stated after releasing the report that:
'RICS is an organisation about which its members are passionate. Whilst those who provided evidence to me disagreed about a great many things, there was one subject which united them, namely the sense of pride they felt at being members of RICS.
This has been a sad and depressing episode in the life of a great Institution. There is a yearning to return RICS to a position of pre-eminence in professional membership organisations. I am confident that with courage and imagination, an independent external governance review will be able to put RICS into the position of moving forward in unity in the public interest.
My report has not made easy reading for the Governing Council of RICS, which has shown courage, leadership and a real commitment to transparency by publishing it in full. I am pleased that it is adopting all my recommendations without delay’.
What happened?
RICS commissioned a Treasury Management audit in 2018.
Four non-Executive Board members of RICS then raised concerns that the audit had been suppressed and were subsequently dismissed from the Management Board.
RICS Governing Council commissioned the Independent Review in January 2021, which was initially dealt with by Peter Oldham QC and later passed to and published by Alison Levitt QC.
The terms of reference for the Independent Review set out three core objectives:
To consider the way in which the internal report was commissioned and dealt with and to determine whether there were any shortcomings
To consider whether any shortcomings represented a failure of governance
To make recommendations for the future.
What were the conclusions of the Independent Review?
In short, sound governance principles were not followed by RICS.
The Independent Review found that the non-Executive Board members’ concerns were legitimate and that they were wrongly dismissed.
A key contributing factor was a lack of clarity around the roles and responsibilities of the various RICS Boards, senior leadership and management. This led to a lack of scrutiny over the actions of the RICS Chief Executive and Chief Operating Officer
This led to a power struggle, rather than a cover up. There was a collective failure of common sense and the situation escalated unnecessarily. RICS was also not served well by their lawyers who protected the executive, rather than giving objective advice to the organisation as a whole.
Prior to the report’s publication, a number of key RICS figures stood down; CEO Sean Tompkins, President Kath Fontana, Interim Chair of Governing Council Chris Brooke and Chair of the Management Board Paul Marcuse. Amit Shah, Chair of the Audit Committee, also came to the end of his term.
The Independent Review contains 18 specific recommendations. These are set out in detail here. These include recommendations on governance, executive remuneration, whistle blowing and legal advice.
What was the response of RICS to the Independent Review?
The RICS Governing Council accepted all recommendations set out in the Independent Review.
Nick Maclean, Temporary Chair of Governing Council said:
‘We are grateful to Alison Levitt QC for her very thorough report and have accepted her findings in their entirety. We commissioned an independent reviewer because we are committed to fostering a culture of openness and transparency and that is why we have published it in full.
Whilst her report makes uncomfortable reading it provide us with an opportunity to implement far-reaching reforms and establish RICS as the gold standard for professional bodies, which will regenerate our historic institution.
I have personally apologised to the non-Executive Board members who were unfairly dismissed on behalf of RICS and would like to repeat this apology publicly, as well as apologising to members of the GC2019 group who were improperly threatened with legal action.
We have accepted the decisions of the CEO, President, Chair of Governing Council and Chair of the Management Board to stand down and thank them for their service.
I can promise our members and staff that we will have an open dialogue about our plans for the new, external review of our organisation and about other changes we implement to address the failings identified in the report.
I can reassure the wider profession and the public that our oversight of professional and regulatory standards has never been compromised by the events described in this report’.
What do I need to know as an RICS APC or AssocRICS candidate?
RICS APC and AssocRICS candidates should be familiar with the conclusions and recommendations of the Independent Review. This includes the principles of good governance, the RICS structure and professional ethics.
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Stay tuned for our next blog post to help build a better you.
N.b. Nothing in this article constitutes legal, professional or financial advice.
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