[AT-Review] Follow up to today's conference call of WG1

Tue Sep 28 15:37:50 UTC 2010

Dear all,

Following an attempt to discuss the matter during today's conference call of
Working Group 1, I am circulating some comments on three issues (already
mentioned in Beijing) that I consider important and that are not easy to fit
into the structure of our existing four working groups.   Most of the issues
also do not have easy answers.

1.            Geographic diversity of the (senior) staff of Icann.

We have all very often heard the remark that the staff of Icann is/appears
very "Anglo-Saxon".   Most of the senior employees are US citizens, with a
sprinkling of Brits, Aussies and Canadians.

Why is that relevant?   Icann serves the world community of internet users.
The embracing of the decisions taken by its Board would be facilitated by
the perception of the organization as a truly international one.   This is
point is recognized in the Icann by-laws which call for a geographic
diversity of the membership of its Board.   The same should apply to the
staff of Icann, at least for the senior position.   In the past Icann has
made a few attempts to recruit people of different backgrounds (I played a
role in the recruitment of a Dutch vice-president), but the present
situation is the one I have described above.   This point is all the more
important if there is a perception that the senior staff has a strong
influence on the decisions of the Board.

However, any recommendation in this sense could not go beyond generically
recommending making a stronger effort to recruit senior staff from different
countries.   It would be totally inappropriate to suggest anything
resembling quotas for an organization as small as Icann.

I am also convinced that any future increase in Icann's staff should take
place outside the US.   While the headquarters could well remain the US, it
is conceivable that certain functions might be managed more and more from
local offices headquartered in various parts of the world.   This would also
help dilute the perception that ICANN is basically still a US organization.
But this is very likely outside the remit of the ATRT.

2.            Prohibition to link incentives to policy outcomes.

We have received information suggesting that the compensation of some senior
members of the staff was possibly linked to the adoption of certain policy
decisions by a given date.

We have no way of verifying this as we would have to request information
that would certainly be of a confidential nature.   But the information is
disturbing.   In some cases, what is controversial is not just the type of
decision that is taken, but the very adoption of a given decision.
Compensation incentives linked to the adoption of a decision by a certain
date create a perverse incentive whereby some member of the staff may stand
to gain by rejecting arguments or position that may delay or block the
adoption of the decision.   It could also act as an incentive for a staff
member to be "economic with the truth" when advising the Board on the degree
of opposition that may exist to any particular policy proposal they are
being invited to endorse.

There is also a reasonable expectation among stakeholders that, as a
non-profit organization, staff should be well remunerated but not seen to be
"profiting" directly from ICANN's revenue stream.   The articles of
incorporation for example state that " No part of the net earnings of the
Corporation shall inure to the benefit of or be distributable to its
members, directors, trustees, officers, or other private persons, except
that the Corporation shall be authorized and empowered to pay reasonable
compensation for services rendered".   Not surprisingly, paying bonuses to
staff for achieving policy adoption targets that result in increased revenue
for ICANN will seem to some stakeholders to be violating, at least in spirit
if not in law, this promise in the articles of incorporation. 

These practices might therefore be seen to be impacting the "Policy
Development Process" in general as well as "the performance of the Board".
Can we deal with this issue?   Where?   What could we say?   We could
certainly have somewhere language that generically suggests that pay
incentives should never be linked to the adoption of given policy decisions.

3.            Revenue maximization

Is there a risk that Icann's decisions might be influenced by revenue
maximization considerations?   I think the risk is remote, but not totally
inexistent.   Some people have mentioned the issue in relation to the
generic TLD saga.   This could be seen as affecting the recommendations of
staff to the Board and subsequent Board decisions or the way in which the
decisions of Icann are accepted by the Internet community.

Would it not be in the interest of Icann to protect itself from such an
accusation/suspicion?   This defense might take the decision of the Board
fixing the amount of reserves the organization deems necessary to protect
itself against unforeseen negative circumstances and announcing that any
surplus would be devoted to funding a given charitable project (somewhere in
the third world?) or to funding two or three charities.   After all, the
articles of incorporation of Icann say that the organization has been set up
only for "charitable, educational and scientific purposes".  

N.B. The European Commission had a similar challenge for EURID (the body
running ".eu") - as a non-profit organization, what would happen if revenue
exceeded operating costs?   One option (the ICANN situation) is to increase
costs.     The other option is to transfer the surplus (the option we took
for EURID). 

All the best,

Fabio

Fabio Colasanti

36, rue des Patriotes

B-1000 Bruxelles

tel. +32 2 736 26 16

mob. +32 488 14 24 05

fabio at colasanti.it

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