Richard Steer said findings of independent report into governance scandal were an ‘appalling advert for our profession’
The chairman of Gleeds has called the findings of last week’s bombshell report into a governance scandal at the Royal Institution of Chartered Surveyors (RICS) an “appalling advert for our profession on the world stage”.
Richard Steer said the 153-year-old body should now undergo a “complete restructuring”.
Alison Levitt QC’s independent report has resulted in the resignations of four of the RICS’ most senior staff, including its chief executive and president.
It found that four non-executive directors of the institution’s governing council were unfairly dismissed after they had demanded answers as to why a critical financial report into the RICS treasury management had been suppressed.
Levitt said that chief executive Sean Tompkins and chief operating officer Violetta Parylo, who quit in June, had become “used to operating with little effective scrutiny” and had developed a “deep-seated resistance to challenge”.
The resignations also include governing council chair and former president Chris Brookes, president Kathleen Fontana and management board chair Paul Marcuse.
Steer said it was “unprecedented” for the leadership team of a body incorporated by Royal Charter to “have to go in this manner”.
He added: “The only good thing to come out of the sorry episode is that it should be the stimulus for a complete restructuring of the body.
“A new team can take the opportunity to listen to the views of the membership, modernise, reform and ensure safeguards are put in place that prevent a debacle of this magnitude never occurring again.”
He also said that questions should now be asked as to whether Sean Tompkins’ £260,000 bonus, which he had been in line to receive in full next year despite the RICS furloughing staff and making others redundant during the pandemic, should be “recouped”.
The four non-execs, Amarjit Atkar, Simon Hardwick, Bruce McAra and Steve Williams, were dismissed by then-president Chris Brooke in November 2019 after they refused to accept the findings of an internal RICS review into the handling of the financial report.
The 10-page report by accountant BDO had given the RICS the lowest possible “no assurance” rating for its treasury controls and warned that it was at risk of “unidentified fraud, misappropriation of funds and misreporting of financial performance”.
Despite repeated requests, the four governing council members were not shown the report until July 2019, seven months after it had been produced.
Their protests had prompted the RICS to order an internal review into the matter, which concluded that there had been no failure of the governance framework and the governing council had been “properly informed and updated” by Tompkins.
But according to Levitt, this review had been outsourced to the RICS’ external lawyers, Fieldfisher, with its conclusions “already decided before it had been commissioned”.
She added that its most important objective was that there should be “no threat to or criticism” of Tompkins, Parylo, Marcuse and audit committee chair Amit Shah.
The findings of Levitt’s report have led to an outpouring of dismay to Building from members of the institution, many of whom have been long standing critics of its leadership in recent years.
Chartered surveyor Stephen Moore said: “For a major professional body with clear responsibilities to the wider public and society, to be publicly disgraced in this way is a national scandal.”
Describing the outgoing senior staff as “self-serving carpetbaggers”, he said he was surprised that they had not managed to survive for so long.
RICS member Roger Carter said he was “absolutely appalled” by Levitt’s conclusions.
“It was much worse than I feared. Tompkins should have been sacked and made to repay his bonus. He was grossly overpaid. This shows the present leadership is not strong enough to take tough decisions.”
He added that members need to “take back control” of the institution and that the governing council should be overhauled”.
Chartered building surveyor Robert Grant also said that the bonus paid to the “useless” Tompkins should be repaid, adding that the evidence in Levitt’s report had been “conclusive and damning”.
He said: “My view is that the RICS should be run as a business not as an amateur club.
“Correct policies and procedures need to be put in place and also an accurate accounting system.
“Compared with some complex construction projects all RICS does is collect membership payments and pay for expenses.”
David Allen, director of property consultancy Alpina, said the RICS has become a “behemoth” where the members are “more of a tool to promote the institution rather than the other way around”.
Retired chartered surveyor Mark Lloyd said the failure to share the BDO report was “totally unacceptable”.
He added that a “magisterium of administrators” at the RICS had failed to rectify shortcomings in the governance structure of the body and had instead “followed their own route”.
Tompkins said in his resignation statement that he was leaving because the changes which might be prompted from Levitt’s report will take time to achieve which he “can no longer commit after 10 years as chief executive”.
Stephen Hill, director of property consultancy C20 Futureplanners, said that what he thought of Tompkins parting statement was “unprintable”.
He added that he was “a man with no awareness of being part of the problem”.
Fontana said in her resignation statement that it was in the “best interest of the institution” for her to step down, adding that the time is right for the body to focus on the future.
Nick Maclean, chair of the governing council’s steering group for the review, said that Levitt’s most important recommendation was to “fundamentally” change the culture of the RICS.
The RICS’ governing council has voted unanimously to endorse and accept Levitt’s conclusions and implement the report’s recommendations.
Tell us what you think should happen next at the RICS
Now, we want you, our readers, to tell us what you think of the findings.
Have the resignations come as a surprise? Does the report change how you feel about the RICS and its reputation? Which recommendations in the report stand out? Is another independent review into the RICS’ future purpose the right way to go? How quickly does the RICS need to take action to address the failures highlighted in the review?
Last week’s news throws up so many questions, and we want to know what you think about it all.
> To have your say, please email the news team at email@example.com