For those of you who do not know her, Dr Nicole Johnston has a PhD in strata and community title law and governance, she is one of the leading Australian researchers in our strata and community title space.

Dr Johnston’s recent project was to research systemic conflicts of interest within the Australian strata industry. That research has now been completed and a link to Dr Johnston’s report is below. I encourage everyone to download and read it as it adds facts to the conflicts discussion.

In summary, and likely of no surprise, the report concludes that there are deeply embedded conflicts of interest in the strata industry’s business models, that disclosure has been ineffective as a tool to try to address the pervasive conflicts of interest and that lot owners (the end clients of the strata industry) often lack understanding of commission structures and how strata firms cross subsidize their fees.

Dr Johnston calls for regulatory reform of the strata industry to address conflicts of interest. I support that call. It will be hard, it will be disruptive, however some strata management firms have already started the transition with small (but impactful) steps such as not taking commissions on insurance or outright prohibiting employees from receiving any gifts from suppliers. Hopefully, these changes continue and the call for reform is heard.