MLS governance is falling behind the markets it serves

For decades, the MLS served as the neutral foundation for cooperation among competitors, providing unmatched transparency and consistency. Its success was rooted in its simplicity: it was infrastructure, not a market participant. But the environment surrounding the MLS has changed, and that neutrality can no longer be taken for granted.

Across Canada, brokerages now operate in multiple regions governed by inconsistent rules and data practices. Consumers expect immediate accuracy. Technology companies are building alternative data ecosystems. 

U.S. compensation rulings are reshaping long-standing assumptions about how real estate information is governed. And as AGM season unfolds, board campaigns once again centre on promises of “greater transparency,” even though the structures these boards operate within are not designed to provide it. 

The system has become more complex, more scrutinized and more consequential than ever, yet its governance foundations remain rooted in a different era.

Neutrality under strain across MLS systems

These pressures have exposed strains in the MLS’s ability to remain a neutral infrastructure. The recent conflict between ITSO and BDAR illustrated how easily MLS access, essential to every Realtor, can become entangled in institutional disagreements.

The dispute stemmed from ITSO amending its bylaws after BDAR announced an integration with TRREB, a move ITSO viewed as enabling a major competitor to gain indirect influence in its governance structure. A court ultimately upheld ITSO’s right to change its membership criteria under Ontario’s not-for-profit laws, reinforcing that organizations can lawfully protect their governance models even if those protections affect existing members. 

Regardless of which organization took the correct procedural path, the structural message was unmistakable: if MLS access can be influenced, even indirectly, by political or organizational disputes, then neutrality is not protected by design but vulnerable to circumstance.

A similar dynamic appeared at the national level during the CREA special assessment vote. Earlier this year, CREA members rejected a $75 assessment intended to replenish the national legal defence fund despite rapidly rising expenses. Many acknowledged that the vote reflected broader expectations of organizational value and accountability rather than an evaluation of the strategic necessity itself. When decisions affecting the industry’s ability to defend itself legally hinge partly on political expression, it reinforces the same alignment problem revealed in the MLS context: governance processes driven by institutional incentives do not always reflect marketplace needs.

These patterns gain urgency in AGM season, where board candidates once again emphasize transparency as a campaign promise. Yet transparency cannot meaningfully improve within governance frameworks that limit what can be disclosed, how decisions are made and who participates in those decisions. 

Boards are not failing due to negligence; they are constrained by structures that make genuine transparency nearly impossible. This is why transparency efforts feel cyclical: the structure never changes, only the slogans do.

Mandate drift raises competitive concerns

Meanwhile, mandate drift within MLS organizations is becoming more pronounced. Flush with reserves and internal technology capacity, some MLSs have begun developing or acquiring tools that increasingly resemble brokerage systems: CRMs, consumer portals, marketing platforms and even lead-generation technology. However well-intended, this places the MLS in direct competition with the brokerages it exists to support.

Neutral infrastructure cannot become a market actor without compromising its neutrality. When infrastructure develops products that shape competition, it is no longer supporting the market; it is influencing it.

Operational pressures tell the same story. MLS datasets have become far more complex and time-sensitive. Several boards have reported significant error rates in recent listing audits, sometimes affecting the majority of reviewed listings. 

These are not operational failures; they are signals of a system stretched beyond the processes, resources and governance structures designed decades ago. Inconsistent rules across regions add further friction, reducing efficiency for teams working across multiple MLS boundaries and diminishing confidence in data reliability.

Realtors push for alignment and clarity

Some Realtors, who fund and rely on MLS operations daily, are becoming increasingly vocal. Their concerns centre on alignment: how reserves are used, how technology partners are chosen, how contracts are negotiated, how innovation is prioritized and how policy inconsistencies create operational challenges for teams. 

They want clarity that MLS innovation will remain focused on infrastructure, accuracy, reliability and interoperability, rather than entering competitive spaces. And they want confidence that the MLS’s neutrality is structurally protected, not merely culturally assumed. 

More than anything, they want to serve clients’ best interests without the systems they fund creating friction, ambiguity or barriers to doing their work well.

This is what alignment requires. The MLS must operate as infrastructure, not as a participant in the marketplace. Its governance must reflect market contribution and responsibility, not institutional politics. Its mandate must be clear and bounded, ensuring that innovation supports cooperation rather than influences competition. And MLS access must be safeguarded against institutional disputes, no matter the context.

A path forward for modernizing MLS governance

Canada is well-positioned to confront this challenge. Our industry has the capacity and leadership to modernize governance structures, clarify mandates and establish consistent transparency expectations. This does not require a national MLS or sweeping structural consolidation. But it does require clarity: clarity of purpose, clarity of authority and clarity of limits. 

A modern MLS framework should articulate what MLSs are responsible for, what they are not responsible for and what principles must guide their governance as pressures increase.

The next phase of this conversation should focus on defining the MLS mandate, aligning governance structures with market realities and establishing a framework for consistency where practitioners need it most. These steps do not prescribe specific reforms; they lay the foundation for a system capable of evolving responsibly without compromising neutrality.

The MLS remains one of the industry’s greatest achievements, but that achievement is no longer self-sustaining. The pressures acting upon the system — from technology companies, regulatory expectations, legal exposure and market expansion — are intensifying. A system this essential cannot rely on legacy assumptions or goodwill. It requires governance equal to its importance.

The industry has a clear choice: modernize now, while the MLS remains strong, trusted and in our control, or wait until external forces reshape it for us. One path reflects leadership and stewardship; the other reflects surrender of agency. The MLS will continue to underpin Canadian real estate. The question is whether we will reinforce that foundation before modern pressures force a reckoning.