Putting consumers first: RECO's governance transition

Op-ed by Jean Lépine, RECO’s Administrator and Acting CEO

Governance plays an important role in any organization. For a regulator, strong governance supports effective decision-making and public confidence.

At its core, RECO exists to protect consumers. Whether buying, selling, or renting, Ontarians deserve confidence that the regulator overseeing the real estate services sector is focused on the public interest.

A regulator's effectiveness begins with its governing principles. To ensure RECO meets the highest standards of oversight, governance renewal has become a key driver of the organization's broader transformation. This initiative, one of eight interconnected modernization projects, is structured to enhance our leadership framework and strengthen our capacity for long-term success.

Since my appointment as administrator in November 2025, one of my key responsibilities has been to develop and implement a governance transition plan that supports the return to board oversight and helps position RECO for long-term success.

On April 30, RECO announced the next phase of that transition following the issuance of Minister's Orders establishing a new governance framework for the organization. This marks the first phase of a two-phase process to return RECO to stable board-led governance.

A new governance structure

The Minister's Orders establish an interim five-member board of directors consisting of three elected directors and two minister-appointed directors. The interim board will be responsible for overseeing RECO's strategic direction, governance, financial stewardship and organizational performance while ensuring the organization remains focused on its consumer protection mandate. The interim board will assume governance responsibilities later this year, with a longer-term transition to a full nine-member board planned for a later date.

Going forward, the board will oversee its own recruitment through a competency-based process designed to identify candidates with the specific expertise required to govern a modern regulator operating in the public interest.

This transition is not a rejection of real estate expertise. Individuals with experience in the sector can bring valuable perspectives to board discussions, but one cannot both guide the regulator and be subject to its regulation.

To that point, the Minister's Orders for the interim board create a clearer separation between the governance of the regulator and those it regulates. Under the new framework, RECO registrants and representatives of industry associations are ineligible to serve as directors. Individuals with real estate experience remain eligible, provided they are not actively subject to RECO's regulatory oversight — ensuring the board leverages industry insight while maintaining absolute independence.

To ensure the regulator continues to benefit from informed sector perspectives, the Orders require RECO to establish a renewed Industry Advisory Council by January 2027 to represent the perspectives of registrants. This council will serve as a structured forum for registrants across the province to share insight on emerging issues and strategic initiatives. RECO is committed to updating the council's mandate and membership to reflect a broad range of practice areas and expertise. Additional details on the renewed terms of reference, membership criteria and the recruitment process will be shared later this year.

Supporting the transition

To support the transition, RECO is advancing a number of related changes, including updates to its membership structure, by-law and articles of amendment.

One of the most significant changes proposed is RECO's membership structure. Under the proposed model, voting rights would be held by members of the board of directors rather than by registrants. In practical terms, this means governance decisions would rest with the board rather than the broader registrant community, aiming to create a clearer separation between the regulator and those it regulates. This approach is consistent with governance and membership models used by many leading regulators in Ontario, including the Financial Services Regulatory Authority of Ontario, the Electrical Safety Authority and the Technical Standards and Safety Authority. It is intended to support a clear distinction between governance oversight and stakeholder representation, while ensuring both remain important parts of RECO's future framework.

As part of this work, RECO has also been seeking feedback on the proposed membership model through a stakeholder survey, meetings and correspondence.

Feedback received so far has highlighted a consistent theme: stakeholders want assurance that registrant perspectives will continue to be heard and considered. We can assure you that sector professionals will continue to play an important role in informing RECO's work.

There is a difference, however, between providing input and governing the regulator.

Industry associations play an important role in advocating for their members and advancing the interests of the profession. RECO's role is different. Our responsibility is to protect consumers, enforce the law and maintain confidence in Ontario's real estate services sector.

Looking ahead

RECO's AGM, scheduled for Jun. 25, will provide an opportunity to share an update on the governance transition and the next steps in implementing the new governance framework. The AGM will also include the election of three directors to RECO's interim board of directors.

Candidates for these positions were identified through an independent, skills-based public recruitment process designed to attract individuals with the experience and competencies needed to govern a modern regulator.

Once the interim board holds office, responsibility for overseeing RECO will be handed to the board, bringing the administrator's term to its planned conclusion. One of the board's first responsibilities will be to recruit for and appoint a chief executive officer to lead the organization into its next chapter.

The governance transition now underway is intended to position RECO for its next chapter — one governed by a board, informed by stakeholder perspectives and focused on protecting consumers.

As RECO continues this transition, we remain committed to listening to feedback and ensuring the organization is positioned to meet the expectations of both consumers and the profession it regulates. At the end of the day, the objective is simple: to ensure RECO remains focused on the people it was created to protect — Ontario consumers.