With the 13 recommendations of Peter Pereira-Gray’s Valuation Review for the RICS accepted in their entirety, there is rightly a debate about whether the Review goes far enough and how far the RICS will go to implement these measures.
What is clear is that under the increasing scrutiny of well-informed clients and exacting auditors, Valuers have got to deliver more.
Improved communication and greater transparency are essential. Clear client instructions at the outset with detailed records throughout the engagement process reduce compliance concerns and risks of undue influence, whilst more detailed valuation considerations and explanations within reports, better respond to client needs. Although the recommendations around these measures may seem aspirational to some, the reality is that they should already be part and parcel of day-to-day valuation practice.
It is also quite clear from our work in some market sectors that better valuations with thought-provoking considerations, as well as appropriate comparables, achieve greater acceptance from clients, often with fewer audit challenges (which itself can offer considerable efficiencies in both time and money). The use of more detailed analytics and broader consideration of factors that influence value and performance, and not just a reliance on backward looking comparable evidence is already a key element of the valuation process in these more challenging times.
This must be the way forward and needs more valuers to deliver to these standards. The practice in some quarters of undercutting fees and delivering to the lowest common denominator is neither effective for clients nor appropriate under this new RICS platform.
Valuers already have a duty to be their best and correctly interpret the rules and regulations of their profession and the Valuation Review can help everyone on that journey once its recommendations can be implemented. Now, more than ever, there is a chance to shine for those firms that already run their businesses utilising the principles of best practice and clear, considered advice.