[CCWG-ACCT] Update on Board discussions on the CCWG Update

Tue Nov 24 13:57:05 UTC 2015

Well said, Ed.
_____________________________
From: Edward Morris <egmorris1 at toast.net<mailto:egmorris1 at toast.net>>
Sent: Tuesday, November 24, 2015 8:33 AM
Subject: Re: [CCWG-ACCT] Update on Board discussions on the CCWG Update
To: Bruce Tonkin <bruce.tonkin at melbourneit.com.au<mailto:bruce.tonkin at melbourneit.com.au>>, Accountability Cross Community <accountability-cross-community at icann.org<mailto:accountability-cross-community at icann.org>>

Bruce,

I find it sad, although expected, that the Board continues to show intransigence and in some areas an unwillingness to compromise by continuing to revisit issues many of us in the community have already settled on. As Milton accurately pointed out,  in response to the community backing away from our second reference model in response to the Board's rather brutal attack on it  several patches were taken from the membership model and applied to the designator approach so we as a collective could move forward. It was a compromise, a grand bargain if you will, that kept hope for this transition alive. Now the Board has come back to express "concern" over those areas of the compromise they never agreed with in the first place. Let me be clear if that if there is further retrenchment from our second reference model, an elimination of the patches which allowed people like myself to give support, however tepid, to the process going forward, an eroding of the comprise that was developed, this transition should and will die an unfortunate death. I would suggest that this Board needs to look forward rather than backwards, stop fighting battles of the past and instead work with the community to reach solutions on new issues heretofore not resolved or subject to a compromise agreement.

It comes as no surprise that the Board, and ICANN corporate generally, has "concern" over the Inspection right. Those conversant in ICANN history will recall that ICANN corporate n the early days of this charitable corporation attempted to deny Board members themselves this right. Litigation ensued. Now those with the right, the Board, wishes to deny it to others who will post transition be jointly assuming some of the authority today possessed by the Board alone. I guess that s a sad commentary on human nature as much as anything else.

The Inspection right is nor principally an instrument of transparency, although it certainly does contribute to same, rather it is an instrument of fraud prevention. It is the principle means by which this community post transition will have to investigate and ensure itself and the global community of internet users that this corporation's finances and governing Board is acting ethically and with due propriety. It is a guarantee that ICANN will not morph into the mode another private organisation with public responsibilities has recently assumed, it is a guarantee that ICANN will not become another FIFA.

There have been reform elements within FIFA for many years warning of the scandalous conduct of leaders of that organisation. Sadly these reformers could not prove what they knew to be true because the organisation itself was shrouded in secrecy at the highest levels. Accounting records were held to be propriety, executive meetings were closed. There were no inspection rights to members of thos organisation under Swiss law. Without access to the records it was impossible to bring malfeasors to account short of government intervention. If we do not grant the community Inspection, the only recourse to guard against corruption at the Board level, to hold the Board accountable to maintaining ethical and proper conduct,  would be the intervention of the Attorney General of the State of California pursuant to his of her §5250 examination rights under the California Corporations Code. I thought one of the purposes of the transition was to wean ICANN away from the oversight of territorially baed governments. By taking away the communities principle tool, a tool to be used only after the same threshold other community rights must reach has been met, to investigate suspected malfeasance the Board's preference would have the opposite result.

Larry Strickling had an interesting take on this issue during a session on jurisdiction at the Internet Governance Forum. Starting at approximately the 1:15 mark here:  http://youtu.be/gHtj4KdmYlc Secretary Strickling extols the virtue of the American and California legal systems. He mentions the deference courts in these jurisdictions give to shareholders and members in corporate disputes.  He specifically contrasts this with the Swiss system, noting that the FIFA scandal happened in Switzerland are not in the United States of America. Yet by attempting to pare back those antifraud aspects of the membership model that we have ported to the new model the Board seems intent on making ICANN's governing structure more like Switzerland's than like California's. What Secretary Strickling saw as advantages of American jurisprudence the Board seems to view as a disadvantage.

I applaud the stated commitment of the Board to increased transparency. Reform of the DIDP and other transparency mechanisms are overdue and should be a principle element of work stream 2 reforms. Yet they are not a substitute for the Inspection right contained, amongst other places, in §6333 of the California Corporations Code. Publishing items on a website is no substitute for access to raw data in times of dispute, crisis or when fraud or malfeasance is suspected. With regards to financial data I draw an analogy to our current position regarding legal counsel: the community has been greatly empowered by it's ability to retain it's own counsel. If we had to rely upon Jones Day I suspect our position would not at all be independent from that of the Board's. Professional opinions and competence may differ. Similarly if financial impropriety is suspected this communities ability to have it's own independent auditors inspect the corporate books is essential. As would be in such situations unfettered access to the records and documents presented at Board meetings. Inspection is an exceptional right granted the community to ensure the base integrity of the corporation. It should not be confused with transparency reforms that pertain more to operational concerns and integrity and are made available to third parties on a request basis. To confuse the two or to offer one as a substitute for another is an attempt to create FUD of the highest order.

I certainly hope the Board reconsiders it's position on Inspection. Equally I hope the community does not. Without the few plugs ported from membership the new reference model is certainly not acceptable to me nor, I presume, to many others inside and outside this community. It's time to move forward, not time to constantly re-litigate the settled issues of the past.

Regards,

Ed Morris

________________________________
From: "Bruce Tonkin" <Bruce.Tonkin at melbourneit.com.au<mailto:Bruce.Tonkin at melbourneit.com.au>>
Sent: Tuesday, November 24, 2015 9:53 AM
To: "Accountability Cross Community" <accountability-cross-community at icann.org<mailto:accountability-cross-community at icann.org>>
Subject: Re: [CCWG-ACCT] Update on Board discussions on the CCWG Update

Hello Milton,

>> it would be impossible to have the information needed to utilize that enforcement power without enhanced transparency and inspection rights.

Understood. The Board agrees that additional transparency and reporting is necessary. What the Board is noting is that the details of what this means needs to be developed for practical use.

ICANN already makes many more documents public than is typical for non-profits. This includes minutes of Board meetings and committee meetings, quarterly financial reporting, detailed annual operating plans, reporting on projects etc.

Where additional information is required by the community - our standard response should be to make it public - rather than rely on having to come into an office an inspect some records.

It is only where a document can't be made public (such as staff salaries) - then it is necessary to have some sort of process for an independent party to inspect and confirm that it is consistent with published policies (e.g the compensation policy).

Regards,
Bruce Tonkin

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