April 2015
IVSC receives recommendations from Review Group
Introduction
In November last year, as a part of a good governance process, the International Valuation
Standards Council (“IVSC”) Trustees commissioned an independent assessment - six years on from
its restructure in 2008 - to ensure the organisation is equipped for the next phase of its
development. As part of the review, the IVS Review Group (“Review Group”) focused on the
governance, financial stability, processes and output of the IVSC in order to provide suggestions for
improvements which would better support future standards development and adoption.
The review included analysis of existing technical guidance, as well as documents regarding
governance and process. Information for the report was gathered via interviews with current and
former Trustees, board members, staff and several key stakeholders.
The IVSC Board of Trustees is pleased to present this summary of the Review Group’s report.
Key conclusions
The Review Group’s analysis confirmed the broad consensus on the need for international standards
and importantly, that the IVSC is the most appropriate organisation to develop them. However, it
also found that the IVSC needs to improve communication with stakeholders and increase
confidence in its future strategy, mission and objectives and to ensure that the organisation is
financially stable and properly resourced to successfully conduct its current and future activities.
Therefore, the Review Group concluded that reform of the IVSC is needed if it is to fulfil its potential
effectively; improve the technical quality of the standards it produces and become the recognised
body for the development of globally accepted valuation standards.
Recommendations
The report made a number of recommendations. Key immediate priorities were to improve the
organisation’s financial long-term viability and its profile among key stakeholders and to enhance
the quality of its standards. In order to achieve these, the organisation must review its staffing
model and resources. It must also establish a clearer definition of purpose and vision, particularly
around the definition of the public interest that it serves.
To further consolidate its position and fulfil its potential, the organisation needs to strengthen its
processes and execution. The organisation was encouraged to develop and adopt robust methods in
its determination of projects and the standard development process, looking at other standard
setters to adopt best practices.
The Review Group also suggested significant changes to the structure of its main bodies (the
Trustees Board, the Standards Board and the Professional Board, the Advisory Forum) with a view of
increasing the level of their effectiveness and expertise.
The Review Group believes the Standards board should restructure in a manner that allows the
involvement of stakeholders in the standard setting process. It is particularly important to ensure
that the valuation theory is clearly understood; underlying all asset classes covered by the IVSC,
primarily real property, business valuations, and financial instruments. Similarly, the Professional
Board should refocus its activities to foster an environment where stakeholders can come together
to focus on Professional Standards over the longer term.
Next steps
Currently the IVSC Trustees are reviewing all report recommendations to see how they can be
adopted. One option moving forward is the formation of a Transition Council made up of selected
trustees and the IVS review group to oversee this upcoming transitional phase. This will help ensure
successful progress of the organisation, which will also include reviewing the existing membership
categories.
The Board of Trustees will conduct a consultation process on the key findings of the Review report
over the next few months.
If there are any questions or points you would like to follow-up on at this stage, ahead of the
consultation process, the Trustees would be delighted to hear from you. Please send an email via
Janet Smy ([email protected]).