People often ask me this question, which is entirely understandable. There are no regulatory bodies that govern the art market and unlike lawyers, art advisors do not need a license to practice. That means it can be difficult for clients and their financial and legal counsel to determine what the added value of an art advisor is, let alone figure out what to ask when looking to engage one. So let’s discuss that in a bit more detail. You may require the services of an art advisor when you are buying or selling art or when you have an entire collection that requires art asset management. In this post I focus on transactions.
Like other intermediaries, art advisors have a more thorough understanding of, and better access to the marketplace than most of their clients which is particularly relevant in the fragmented, opaque art market. An art advisor is therefore able to add value in three ways: she saves her clients time and money and reduces their risk. How? For starters, by doing the legwork. She conducts price research (what are the comps?) and due diligence (was it stolen? faked? restored?). The results or her research form the basis for negotiating the transaction on behalf of her client, or perhaps advising her client not to transact at all.
If you are on board with the value add, there are a number of questions to ask when engaging an art advisor. Discretion is an important point to raise and transparency is another, particularly in relation to conflicts of interest and pricing, which we discuss in the FAQ section on our website. The most important topic of discussion, however, is independence. An art advisor’s job is to provide unbiased advice to her clients. Unlike auction houses or galleries, an art advisor does not have stock because she should not have a financial interest in the artworks she is advising her client on. Similarly, an art advisor should never operate on two sides of one transaction because it would create a conflict of interest. To sum it up: we feel that an art advisor has a fiduciary duty towards her clients even though she does not need a license to operate.