[CCWG-Accountability] Regarding role of Board directors

Sun Jan 11 09:06:33 UTC 2015

Dear Bruce
I have noted that you tried very hard to  pick up provisions from ICANN
Bylaws and your practical experience  and to reply to Robin ,Alan ,Akinbo
and Other still the basic questions currently produced the  legal GAP
continue to exist
 " trying to do public governance via a private corporation - the two
concepts weren't "built" for the other", and
" when the Board is confronting a community consensus to take an action
that could put the corporation at risk of a lawsuit"
There are conflicting  conditions under which ICANN is working.
Perhaps the corporation enviroment does not respond to the global community
consensus demand
I think this should be further explore and resolved rather than you try to
make a cut and paste between the two which does have legal inconsistencies
Kavouss

2015-01-11 9:30 GMT+01:00 Adebunmi AKINBO <akinbo.adebunmi at gmail.com>:

> +1 DelBianco = So, when the Board is confronting a community consensus to
> take an action that could put the corporation at risk of a lawsuit … how do
> you believe a board member is obliged to react?
>
> On the above, can we seek a legal opinion?
> Its important to address this scenario.
>
> This can happen at anytime in the lifetime of ICANN.
> -Akinbo.
>
>
>
> On Sun, Jan 11, 2015 at 4:33 AM, Alan Greenberg <alan.greenberg at mcgill.ca>
> wrote:
>
>>  I am not an ICANN Board Member. I am not a lawyer. I am not a California
>> law expert.
>>
>> But I "hope" that the answer is "it depends".  I would like to think that
>> the risk of being sued and the potential liabilities (and the chances of
>> losing!) would be weighed against the ICANN Mission, Core Values and its
>> Articles of Incorporation which includes the phrase "The Corporation shall
>> operate for the benefit of the Internet community as a whole".
>>
>> Alan
>>
>> At 10/01/2015 08:40 PM, Steve DelBianco wrote:
>>
>> Thanks for the larger context around that bylaws provision, Bruce.  But
>> if we are considering whether the bylaws refer to â€˜ICANNâ€™ as the
>> corporation or the *community*, see ICANNâ€™s own Management Operating
>> Principles (2008 link
>> <https://www.icann.org/en/system/files/files/acct-trans-frameworks-principles-10jan08-en.pdf>,
>> p. 5):
>>
>>  "The third and perhaps most critical point of tension is between the
>> accountability to the participating community to perform functions in
>> keeping with the expectations of the community and the corporate and legal
>> responsibilities of the Board to meet its fiduciary obligations. The
>> ultimate legal accountability of the organization lies with the Board, not
>> with the individuals and entities that make up the ICANN community.â€
>>
>>
>> So, when the Board is confronting a community consensus to take an action
>> that could put the corporation at risk of a lawsuit … how do you bellieve a
>> board member is obliged to react?
>>
>>
>> From: Robin Gross <robin at ipjustice.org>
>> Date: Saturday, January 10, 2015 at 8:10 PM
>> To: Bruce Tonkin < Bruce.Tonkin at melbourneit.com.au>
>> Cc: " accountability-cross-community at icann.org" <
>> accountability-cross-community at icann.org>
>> Subject: Re: [CCWG-Accountability] Regarding role of Board directors
>>
>> Thanks for the info, Bruce.  It is worth pointing out that regardless of
>> how those bylaws are interpreted, under California law, nonprofit board
>> members owe a legal duty of loyalty to the corporation and there isn't
>> anything that this working group can do change California corporations law
>> and the legal duty of loyalty each board member owes to the corporation (as
>> a corporation, yes, not staff).  This is where a tension comes in for
>> trying to do public governance via a private corporation - the two concepts
>> weren't "built" for the other, so there are gaps and some issues as a
>> result.  I think this is an issue our group should explore.
>>
>> Best,
>> Robin
>>
>>
>> On Jan 10, 2015, at 4:43 PM, Bruce Tonkin wrote:
>>
>>  Hello  Steve,
>>  ICANN Bylaws Article 6 Section 7 defines the duty of directors to ICANN
>> the Corporation:
>>
>> Directors shall serve as individuals who have the duty to act in what
>> they reasonably believe are the best interests of ICANN and not as
>> representatives of the entity that selected them, their employers, or any
>> other organizations or constituencies.
>>
>>  I have often heard you refer to that specific clause in the bylaws over
>> the past year.
>> I think it is worth understanding it a little more.   I personally
>> believe that the intent of putting this clause in the bylaws is that
>> several Board members are appointed to the Board from a specific
>> stakeholder group, and this makes it clear that Board members need to act
>> on behalf of all stakeholders not just the stakeholder group that appointed
>> them.   So from my perspective it is a higher level of accountability than
>> simply being accountable to the group that appointed them.   We certainly
>> make that clear as new directors join the Board.
>> The clause does not mean that somehow a Board director  is now
>> accountable to the staff in the organization rather than the "ICANN
>> community".
>> For those appointed to the Board by the nominating committee - I think it
>> is already clear to them that they represent stakeholders as a whole, as
>> they go through a rigorous interview process in front of the whole
>> nominating committee.
>> In my experience as Board director, Boards in general operate on behalf
>> of their stakeholders - these stakeholders could be the general public,
>> shareholders, or members.  Under its articles of incorporation,  ICANN is
>> structured to act on behalf of the global public interest - i.e. the
>> general public.
>> In addition to acting on behalf of stakeholders, a board is also
>> accountable to govern an organization in accordance with the law.   This to
>> me is the "corporate" obligation that you often refer.   This includes
>> ensuring that the organization can meet its financial commitments, ensure
>> the staff have a safe workplace, ensure there are financial controls to
>> stop fraud, ensure the organization complies with any contracts it has
>> entered into etc.   Directors of ICANN can be held personally liable under
>> law if they are negligent.
>> After the ATRT1 review,  a set of governance guidelines were established
>> to make this clearer:
>>  https://www.icann.org/resources/pages/guidelines-2012-05-15-en
>> From the section on the role of directors:
>> "The fundamental responsibility of Directors (as defined below) is to
>> exercise their business judgment to act in what they reasonably believe to
>> be the best interests of ICANN and in the global public interest, taking
>> account of the interests of the Internet community as a whole rather than
>> any individual group or interest"
>> "It is the duty of the Board to oversee management's performance to
>> ensure that ICANN operates in an effective, efficient and ethical manner.
>> The Board will also be responsible for overseeing the development of
>> ICANN's short, medium and long-term strategic plans, ensuring that they
>> will result in sustainable outcomes, and taking account of the critical
>> interdependencies of financial, human, natural, manufactured, social and
>> intellectual capitals."
>> "Some of the Board's key responsibilities are to ensure that ICANN's
>> ethics are managed effectively, that ICANN as a whole (as well as
>> individual Board and staff members) operates pursuant to the highest
>> ethical standards, that ICANN complies with applicable laws, and that ICANN
>> considers adherence to best practices in all areas of operation."
>> The bylaws could certainly be enhanced to incorporate the notion in the
>> Governance Guidelines that Board directors are accountable to the Internet
>> community as a whole.
>> Regards,
>> Bruce Tonkin
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>
>
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