RICS Annual Review 2024: Our Governance

Standards and Regulation Board (SRB)

Purpose of the Board

The Standards and Regulation Board (SRB) delivers independent professional regulation for RICS, acting in the public interest to uphold standards. It strengthens trust and confidence in the profession through:

• rigorously applying the principles of better regulation and maintaining regulatory autonomy
• setting and upholding the standards of entry and assessment to the profession
• responsibility for the maintenance of professional standards, including approving technical standards, setting conduct standards (including the RICS Rules of Conduct) and developing regulatory policy

a. developing, setting and upholding the professional standards of RICS’ Dispute Resolution Service. It is responsible for the appointment of the President’s panel of dispute resolvers, education and accreditation of alternative dispute resolution (ADR) qualifications and the administration of disputes, as well as promoting alternative mechanisms of dispute resolution

• using targeted, proactive regulatory compliance, enforcement and assurance activities to regulate RICS members and RICS-regulated firms
• working with the profession, the public, external stakeholders and global agencies to share intelligence and lead regulatory best practice

b. providing assurance to Governing Council that the Regulatory Tribunal and its processes are operating effectively for consideration of cases involving serious allegations of failing to adhere to the Rules of Conduct and incompetence against RICS members and RICS-regulated firms.

SRB leadership and independent regulation

The independently-led SRB provides assurance to the profession, public and stakeholders that RICS members and RICS-regulated firms meet professional standards, including those set out in RICS’ Rules of Conduct. The SRB leads the development of a consistent global regulatory strategy and oversees operational delivery across all world regions where RICS members operate.

The SRB oversee the Regulatory Tribunal, which acts at arm’s-length from RICS. The Tribunal is independently led by Presiding Chair, Alexandra Marks CBE, who reports to the SRB. The Regulatory Tribunal consists of independent and RICS members, who sit as panels of three to make disciplinary and regulatory decisions, or on their own as single member decision makers on certain types of cases.

The SRB and SRB Executive work closely with the membership body in RICS but ensure its independence through leadership, staff reporting lines and decision making, ensuring effective implementation of the RICS Regulatory Framework. The SRB is supported by the SRB Executive and staff teams, as well as delegating some of their function and responsibilities to SRB subgroups including the Dispute Resolution Appointments Board, Qualifications and Assessment Committee, Valuation Assurance Committee and ‘task and finish’ groups including the Professional Standards Steering Group, Entry and Assessment Steering Group, Continuing Professional Development Framework Steering Group and pilot Consumer Working Group.

Interim SRB to permanent SRB by May 2024

Following the resignation of the former SRB Chair in late June 2023, RICS appointed an interim Board, which was in place from 24 July 2023 to May 2024. The former interim Chair Nigel Clarke was permanently appointed on 4 December 2023 and completed his recruitment and induction of the new members of the Board in May 2024.

The composition of the Standards and Regulation Board during the financial year for 2024 is

Overview from Nigel Clarke, Chair of the Standards and Regulation Board

2024 has been a year of consolidation and progress on some major objectives by the SRB, maintaining RICS’ credibility as a professional body based upon a solid foundation of independent regulation within the Institution.

In May 2024 we appointed ten, high calibre, permanent members to the SRB, recruiting from around 300 applicants. The new members bring a wealth of expertise across a diversity of surveying practice, types of business and regulatory and built environment experience.

I want to publicly thank the members of the Interim SRB for their significant contribution to RICS and the public interest, maintaining rigorous governance oversight and support across the regulatory activities for which we are responsible during a challenging time.  

Through a busy year, we were pleased to publish SRB’s first Annual Report and first Risk and Assurance Outlook. Both documents have helped to share the key areas of focus for the SRB, linked to this was our early objective reviewing our regulatory strategy, the operational structure and key areas of regulatory risk. We have set six strategic priorities, focused on enhancing our impact as a regulator and strengthening trust and confidence in the profession. Alongside our ongoing assurance of operational work, these seek to support the profession to improve competence and to better communicate the benefits of regulation to those who rely on the work of our members and firms.

A highlight of my work as Chair of SRB this year has been the opportunity to meet with members at events across the UK, in the Middle East and AsiaPacific. It has been a privilege to hear of their pride in the profession, their appreciation for the value of regulation to their clients and the public, and their feedback and suggestions for improvement.

Many of those conversations have built on the public consultations we have run this year on work taken forward by two working groups on topics of vital importance to the profession – entry and assessment to RICS, and the requirements we set for continuing professional development. These working groups have now reported to SRB and Governing Council, and work is starting in earnest in these areas. Our wholehearted thanks go to the members and specialist independents of those working groups for their diligent and careful approach to developing these ambitious proposals.

RICS Executive Summary by Senior Executive Officer, Chris Alder

Our focus this year as the independent regulator of the profession has been to maintain the high-quality operational delivery that is at the heart of our regulatory delivery, while undertaking ambitious and collaborative work to strengthen trust and confidence in the profession.

Throughout 2024 we reached ambitious milestones in areas such as our review of the Continuing Professional Development framework and model for RICS’ Entry and Assessment, reviewing the Dispute Resolution Service (DRS) governance as well revising a number of important Professional Standards.

Across our operations we have strengthened a range of controls to embed greater resilience and have sought to grow our reach - this has included training a significant number of new assessors, expanding DRS’ influence and introducing further proactive assurance mechanisms. We have taken forward work to improve our current assessment model in parallel with our aspiration to develop a global assessment model that is fit for the future, can be scaled to meet RICS’ intentions for growth and will deliver a first-in-class experience for all involved.

In line with the trend of other professional regulators, 2024 has again seen an increase in the number of concerns raised with us about RICS members and firms. Changes to our processes - focusing on increased support for our professional members and rebalancing resource towards the earliest stage of case triage - have enabled us to maintain performance and improve the quality of our decision- making. Of the increased number of concerns, we have recognised that a significant proportion are complaints about non-RICS ‘surveyors’. Through this year we have strengthened our capability to respond to these, as well as deepening our ability to share intelligence with other agencies.

DRS has continued to provide expertise globally to initiatives that grow recognition of RICS while also having a direct public interest benefit of alternate methods of dispute resolution, as well as taking forward initiatives to encourage greater diversity within this specialism.

While our operational delivery and areas of development have been highlighted, it is equally encouraging that RICS’ influence and recognition continues to grow through SRB’s regulatory thought leadership.  At a time of such geopolitical uncertainty and weakening of trust in Institutions, SRB’s ability to convene and drive closer public interest working in the global regulatory arena helps to uphold confidence. Working with global NGOs, multilateral agencies, regulators, business and trade organisations, governments around the world and other professions, SRB’s leadership has helped bring focus to crucial issues of today.

Through 2024 and moving into 2025, these include our development of professional standards on the ethical and responsible use of AI, working alongside global agencies to develop mechanisms to combat corruption and illicit financial flows in the built environment and convening industry leaders on the ethic challenges on the adoption of AI in arbitration.

Committees

Audit, Risk Assurance and Finance Committee

This section covers the activities of the Audit Risk Assurance and Finance Committee (ARAFC) from 1 January 2024 to 31 December 2024.

The main purposes of the ARAFC under its terms of reference are:

a. oversight regarding financial management and reporting, financial sustainability and the annual reports and accounts

b. accountability for reserves policy, investments and pensions, and

c. ensuring that there is an adequate and effective risk management and assurance framework in place and that these are reviewed to meet the needs of the RICS Board and, where necessary, Governing Council.

The ARAF Committee’s responsibilities are to advise the RICS Board and CEO on:

d. the strategic process for risk, control and governance

e. the accounting policies, the accounts and the RICS annual report, including the process for review of the accounts prior to submission for audit, levels of error identified and management’s letter of representation to the external auditors

f. the planned activity and results of both internal and external audit

g. adequacy of management response to issues identified by audit activity, including external audit’s management letter

h. assurances relating to the management of risk for the Institution

i. the performance of and (where appropriate) proposals for tendering for either Internal or External Audit services and for purchase of non-audit services from contractors for special investigations

j. anti-fraud policies, whistleblowing processes and arrangements for special investigations.

The ARAF Committee met five times during the period of 1 January 2024 to 31 December 2024.

The main activities and areas of focus for the ARAF Committee in 2024 were:

Annual Report and Accounts

In Q1 and Q2 of 2024, the ARAF Committee focused considerable effort on the Annual Report and Accounts, working with both the RICS Finance Team and external audit partner, Grant Thornton. The completed Annual Report and Accounts were submitted to the RICS Board on 16 May 2024 and to the membership at the AGM on 27 June 2024.

ARAF was satisfied that in preparing the financial statements the following requirements had been met:

• Suitable accounting policies had been selected and applied consistently.
• Judgements and estimates were made that were reasonable and prudent.
• Applicable accounting and financial standards were followed, subject to any material departures disclosed and explained in the Financial Statements.
• The financial statements were prepared on a going concern basis.

The ARAF Committee received an update in Q4 of 2024 on the progress of the Annual Report and Accounts for the period ending 31 December 2024, with particular focus on:

• enhancing the year-end process
• reviewing and considering all accounting policies and disclosures to ensure that they remain relevant, in line with IFRS and consistent with like organisations
• reviewing and considering the narrative of the statutory accounts from the perspective of the RICS membership.

Strategic risk management

The ARAF Committee reviewed the Strategic Risk Register in detail at each quarterly meeting, noting feedback from the risk team and wider Senior Executive team on the progress of implementing mitigation measures for each strategic risk. The ARAF Committee also received reports on two deep dives into strategic risks relating to relevance and technology.

Internal audit

Throughout 2024, the ARAF Committee were presented with updates from internal audit partner, Validera, on recent internal audit activity at each quarterly meeting,

accompanied by the executive sponsor of the internal audit to discuss the

recommendations and subsequent actions.

The ARAF Committee also discussed in detail, a report on the validation of the outturn

against the corporate objectives for 2023 to provide assurance to the NRC in their

consideration of FY2023 incentive plan payments.

Management accounts and performance reviews

The ARAF Committee monitored and reviewed the management accounts, and performance against business objectives. The Committee reviewed and endorsed the business strategy and budget for 2025.

Investments

The ARAF Committee reviewed investment performance on a quarterly basis and received a detailed update from investment partner, Mercer, in Q3 of 2024.

The ARAF Committee also considered the institutions reserves position, endorsing recommendations made by the Chief Finance Officer for review and approval by RICS Board.

Policy review

The ARAF Committee reviewed several policies throughout 2024, the policies were reviewed from a finance perspective where applicable but also in relation to risk management, ensuring policies are aligned with internal audit recommendations.

Speak-Up policy (Whistleblowing)

The ARAF Committee received quarterly updates throughout 2024 on the effectiveness, operation and promotion of the Speak-Up policy across the organisation.

The below table sets out the composition of the ARAF Committee from 1 January 2024 to 31 December 2024:

Nominations and Remuneration Committee

This covers the activities of the Nominations and Remuneration Committee (NRC) from 1 January 2024 to 31 December 2024.

The main purposes of the NRC under its terms of reference are to:

• oversee the election, appointment and succession planning process, as appropriate, for all governance bodies, the President and the CEO, ensuring that processes are fair, objective and able to identify high-calibre individuals with the right skill sets from a diverse pool of applicants
• oversee the performance evaluation process for all governance bodies, ensuring they are linked to the appraisals for individual governance body members and that there are mechanisms in place to address poor performance and identify mentoring and training needs
• set the remuneration policy for RICS employees at all levels in line with RICS’ long-term strategy, and approve the annual budget available for salary review
• determine and review the remuneration strategy for senior RICS employees to recruit, retain, motivate and engage high-calibre senior employees in order to deliver its business objectives globally, and
• set the total remuneration for the CEO and non-executives and review the remuneration of the executive team and other senior employees that fall within its remit.

The NRC’s responsibilities include:

• approval and oversight of the Global Appointments Model (GAM)
• an advisory role to Governing Council and the RICS Board in relation to matters within its remit
• oversight of elections to Governing Council, including any validation process
• identifying and nominating for approval candidates to fill RICS Board vacancies
• monitoring adherence to the GAM in relation to other governance body appointments
• ensuring orderly succession planning to governance bodies and to the executive team
• ensuring adequate induction and training for all new governance body members
• performance evaluation reviews of Governing Council and the RICS Board
• oversight of the performance evaluation process used by other governance bodies
• approval and review of the appointment process for the CEO
• assessing the diversity and inclusiveness of governance bodies and senior management
• setting the remuneration policy for RICS employees in line with RICS’ long-term strategy
• determining the terms of employment and remuneration package for the CEO
• determining the terms of employment and remuneration for the executive team
• determining the remuneration of non-executive governance body member roles
• approving the design of executive incentive plans, including eligibility and plan rules, and
• approving the overall level of incentive payments and individual bonus amounts.

The NRC met eight times during the period of 1 January 2024 to 31 December 2024.

The main activities of the NRC during 2024 comprised of the following.

Governing Council Elections 2024

A working party of the NRC considered feedback on the 2023 GC election process in the first quarter of 2024. This resulted in a small number of changes to the process. The NRC also provided input into the development of the 2024 election collateral and communications plan and approved the finalised collateral in readiness for opening of the applications to stand for election. Post elections, a small working group of NRC members has been established to review the 2024 elections, with any suggested changes to be recommended to Governing Council in Q2 2025, ahead of the 2025 election process commencing.

SVP Election Process

The NRC reviewed the process for appointing the 2023 and 2024 SVPs and approved small changes to the process for the 2025 SVP election. Saxton Bampfylde were selected as the recruitment firm to support the process. With 23 applicants in total, Maureen Ehrenberg was elected by Governing Council to the position of SVP from 2025. A working group, comprised of NRC and GC members was created to review the process and provide any recommendations for change to Governing Council in 2025, ahead of commencement of the 2026 SVP process.

Appointments

With less recruitment required throughout 2024 in comparison to previous years, the NRC focus has been on increasing the diversity of applications for all governance roles. A workshop session was held in Q1 2024, with continuing monitoring of progress and applications throughout 2024.

The NRC conducted a full review of the Global Appointments Model (GAM) during 2024, which will be completed in 2025, once the ongoing work to review the type of governance and engagement bodies within the organisation is concluded.

Performance evaluation

Throughout 2024, the NRC developed and piloted a performance evaluation process for individuals holding governance roles. This process will be completed by all governance bodies in 2025. Members of the NRC have worked closely throughout 2024 with the Presidential Team and Senior Independent Governor to develop an individual development assessment process for members of Governing Council which is due to be implemented in 2025.

The NRC commissioned an evaluation of RICS Board, conducted by an external evaluation provider and a working group has been established to oversee implementation of recommendations from the evaluation.

Salary Review 2025

The NRC approved the budget for the April 2025 salary review in October 2024, with further consideration to be made in Q1 2025 with the Target Operating Model implementation.

Executive Incentive Plan 2023, 2024 and 2025

On review of the outturn against corporate objectives and the final audited operating result, the NRC approved payout of the FY2023 executive incentive payments. The NRC also set the design, structure and targets for the FY2024 incentive plan and have commenced review of the FY2025 plan for approval in Q1 2025.

Fees for individuals holding Governance roles

A working group, comprised of NRC members, was formed to review non-executive remuneration for those holding governance positions. The working group updated the NRC on progress in Q4 2024 and will be making their full recommendations in 2025.

Other Activities

In addition to the topics covered above, the NRC also participated in the following actions during 2024:

• commenced work on developing skills matrices for governance bodies
• received regular updates on the ongoing work to create a robust evaluation and pay framework
• reviewed and approved the structure of the 2024 market incentive schemes and monitored their effectiveness.

The below table sets out the composition of the NRC from 1 January 2024 to 31 December 2024:

Global Members Committee

Previously known as the Membership Services Committee, the Global Members Committee has oversight of the five World Regional Boards - Americas, Asia Pacific (APAC), Europe, Middle East & Africa (MEA) and UK & Ireland, which report into the Committee.

The main purposes of the Global Members Committee, under its terms of reference is to:

1. champion the delivery, and ensure the quality and consistency, of member services, experience, engagement, and value
2. consider and recommend regional business plans developed by World Regional Boards for approval by RICS Board as part of the overall business plan
3. act as a conduit between RICS members, World Regional Boards and RICS Board, to ensure that the sentiments expressed by members and permanent staff of RICS to World Regional Boards, are conveyed to and understood by RICS Board.

Key activities of the Global Members Committee during the year included review of the:

• the global market strategy framework
• market plans
• performance dashboards, budgets, terms of reference and updates of the five World Regional Boards
• member experience framework
• global volunteer recognition programme
• improvements to member communications and the Consent Centre.

The Committee also considered and discussed member subscriptions, CPD framework and the relevance of new pathway/qualifications options relating to sustainability and data/AI/technology. Member satisfaction, retention and growth continued to be key objectives.

The Global Members Committee met 4 times in the period from 1 January 2024 to 31 December 2024.

The table below sets out the composition of the Global Members Committee from 1 January 2024 to 31 December 2024.

Knowledge and Practice Committee

The Knowledge and Practice Committee works closely with the RICS Knowledge and Practice team and Professional Group Panels to review and support the work being undertaken to achieve the corporate objectives of RICS.

The main purposes of the Knowledge and Practice Committee under its terms of reference are to:

• maintain and develop the knowledge and professional practice of surveying, for the public advantage, by developing, maintaining and promulgating:
  • technical standards, associated advice and practitioner information regarding the knowledge and professional practice of surveying
  • RICS’ body of education, training and professional development materials, for the different sectors within the surveying profession
• advance industry and public knowledge on relevant, key issues affecting the natural and built environment, amplifying the expertise and voice of the profession, to maximise its influence for the public advantage
• develop and maintain arrangements that ensure RICS’ work is informed and guided by expert insight and member input on practice and market issues, trends and emerging/future professional requirements relating to the knowledge and practice of surveying
• through expert insight and member input, develop and evolve the competences required for APC pathways and ideas for new pathways as and when appropriate ensuring no overlap of role with the Standards and Regulation Board (SRB).

Key activities during 2024

During 2024, the Knowledge and Practice Committee:

• agreed and approved the Knowledge and Practice strategic plan for 2024 and established and inducted the six Professional Group Panels
• established joint working with SRB’s Professional Standards Steering Group (PSSG) and instigated a sub-group to review the standards and practice information programme
• actively consulted on the Entry and Assessment Review and CPD projects
• inputted into conference programmes
• instigated a sustainability sub-group to review knowledge and practice sustainability outputs and plans
• undertook detailed review of detailed review of options for Sustainability qualifications   including recommendations to RICS Board.

Key issues during 2024

During 2024 the key issues that the Knowledge and Practice Committee considered were:

• prioritisation of standards programme and ensuring close collaboration with PSSG for the approval of projects
• RICS response to AI and technology and sustainability programme.
• supporting adoption of the Whole life carbon assessment standard into the market
• RICS engagement with UK government and key stakeholders and response to other UK government policy priorities
• current pricing of webinars and other CPD offerings by RICS.
• ensuring wider member engagement and awareness of the work of Knowledge and Practice Committee and Professional Group Panels, through communication campaign
• developments and advising on UK residential including retrofit, home surveys and government regulation of estate agents.

The Committee was supported by 76 members of Professional Group Panels. Their contribution is appreciated.

Professional Group Panel Chairs were actively involved in the production of conferences on behalf of the QS and Construction, Building Surveying, Building Conservation, Telecoms, Planning & Development, Construction and Infrastructure, Land & Property, Commercial Property, Residential Property, Minerals & Waste Management, Rural, Valuation and Fire Safety sectors.

The Knowledge and Practice Committee met 4 times in the period from 1 January 2024 to 31 December 2024.

The table below sets out the composition of the Knowledge and Practice Committee from 1 January 2024 to 31 December 2024: