The 2020 Sector Risk Profile released by the Regulator of Social Housing (RSH) last month, sets out the key areas of risk that registered providers should be aware of. In particular, it emphasises the fundamental role of Boards in setting the strategic direction for organisations to manage these risks, while also recognising that COVID-19 has significantly impacted the operational environment this year. With 20 separate areas of risk outlined in the report, we consider five key themes below.
Ultimately, Boards should be providing appropriate direction to their Leadership Teams to inform strategic decision making. This is not an easy task, as there are currently a significant number of competing pressures and risks to consider and balance. For example, investment in existing housing stock, new development, maintaining financial viability, health and safety, rents and income, stress testing, and operational risks.
Boards are required to have a broad range of skills to be able to understand the demands placed upon them and navigate these challenges successfully.
The RSH asserts that failure to invest in stock and understand your stock profile poses a risk to tenants’ mental and physical health. Providers must ensure Decent Homes Standards are maintained, and also prepare for the changing environment around building safety and energy efficiency.
Health and safety
It should be of no surprise that meeting statutory health and safety obligations is highlighted by the RSH and should be a key priority for providers. The RSH specifically mentions the ‘big six’ areas of property compliance that providers should be concerned about: gas, electric, fire, asbestos, water hygiene and lifts.
Service delivery and accountability to tenants
The RSH states that,
‘The quality of a registered provider’s relationship with tenants reflects the culture of the organisation and ultimately underpins the trust and confidence that tenants and other stakeholders have in the organisation.’
This statement summarises why engagement with tenants and excellent service delivery is so important. Registered providers must appreciate the ethos and origins of social housing. Indeed, the consumer standards (Home Standard, Tenancy Standard, Neighbourhood and Community Standard, and Tenant Involvement and Empowerment Standard) are set by the RSH to provide a clear framework of what is expected of registered providers, obligations towards tenants and to hold providers to account.
Data integrity and security
Robust management of data for areas such as rent setting, stock condition, health and safety, and tenant satisfaction is a fundamental undertaking for providers. The RSH is right to draw attention to this, as accurate and up-to-date information allows Boards and Leadership Teams to monitor, scrutinise and challenge effectively. In addition, data security is important to ensure compliance with the Data Protection Act 2018 to avoid security breaches and penalties.
The RSH’s Sector Risk Profile is a must read for Boards and Leadership Teams operating within social housing. We have highlighted just five of the 20 sector risks identified, however, the others are also of equal importance (reputational risk, diversification, value for money, construction process risks, and so on).
Pennington Choices offers a variety of comprehensive assessments and solutions that can help you navigate these challenges (health and safety, stock condition, data management, and so on). Our expert team of consultants are experienced in providing advice and guidance to landlords on a range of property and housing management issues.Back to blog