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<div class="moz-cite-prefix">On 2/26/16 3:01 PM, Evan Leibovitch
wrote:<br>
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<div dir="ltr">In most jurisdictions in which I have been
involved in the creation of nonprofits, the kind of member-less,
mostly-unaccountable-Board that is the cornerstone of ICANN's
present structure could not exist.</div>
</blockquote>
In California the memberless approach is intended for use by things
like theatre companies that tend to reflect the artistic direction
of a director. The creation of ICANN intentionally mis-used the
memberless approach (and we saw the legal scurrying when ICANN held
the 2000 "selection" that was actually an "election" that triggers
the mandatory use of a membership structure.)<br>
<br>
However, a member based organization can be created - and often is
created - in California. The rules of membership organizations here
are pretty decent. And given that ICANN is already a California
public-benefit/non-profit those rules would slide onto the
organization like a well tailored glove. Or to pick a different
simile - moving ICANN (including its assets and contracts) to
another jurisdiction and imposing these proposals would be somewhat
like attaching a helicopter to El Capitan in Yosemite and trying to
air lift it to Iceland - at best hard, more likely impossible.<br>
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<div class="gmail_default" style="font-family:'trebuchet
ms',sans-serif">In most other nonprofits in most other
places where one exists, a Nominating Committee does
exactly that</div>
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</blockquote>
Nominating committees are troublesome, because one needs a solid
legal structure to create them, populate them, run them, impose
standards of care on the committee members, resolve disputes, and
use their output.<br>
<br>
The use of nominating committees is particularly ICANN-ish; it is
not a common form of organization largely because they contain all
of the structural issues of a board of directors. In a sense they
become simply a higher level board of super-directors. And then one
turns the recursion crank and ask "who nominates the nominating
committee, and what if there is disagreement?" One might think that
there is no risk of competing panels each claiming to be "the
nominating committee". But world history has demonstrated that this
thing can, and has, occurred.<br>
<br>
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<div class="gmail_default" style="font-family:'trebuchet
ms',sans-serif"> -- nominate a slate that must be
elected or ratified by some greater body. It is this
body -- not the Board itself or the NomComm -- that
determines the fiduciary duty and the good to be served.</div>
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</blockquote>
Fiduciary duty is to the corporate body, period. It is not levied
onto a board or directors or individual directors by an outside
body, particularly not by a nominating or electing body. That duty
of care to the corporate interest alone is a fairly primary
foundational element of corporate structures.<br>
<br>
That said, in public-benefit/non-profit corporations, such as ICANN
the corporate interest is measured by how well the corporation
improves the public interest. That twist is something that is not
well understood by most people who sit in board seats on
public-benefit/non-profit corporations.<br>
<br>
But let's be clear - a corporate director owes no fiduciary duty to
follow the opinions of a nominating committee or a membership. The
entire duty of care is to the corporate interest (which in our case
includes the public interest.) Ethics, politics, and simple good
sense indicate that those opinions should be heard and considered.
But, again, there is no duty to accept them or give them more weight
than any other source of information.<br>
<br>
One of the best ways to destroy a corporation is to create
marionette strings in which parties such as shareholders or debt
holders or members or nominating committee can affect the decisions
of a board of directors.<br>
<br>
That penetration of the corporate structure is the great danger that
I see in these proposals. The result of such a failure would be
chaos. It is foolish to consider proposals that contain that risk.
And these proposals do.<br>
<br>
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<div class="gmail_default" style="font-family:'trebuchet
ms',sans-serif">I had never encountered the ability of
a nonprofit to unilaterally shed itself of Board
oversight by its members until ICANN.</div>
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</blockquote>
ICANN does not have that ability. It can not wave a wand and say
that it does. People should laugh (or as I did, take legal action)
when ICANN makes such assertions.<br>
<br>
But, unfortunately, people have accepted ICANN's assertions about
membership. It might legal action to dispel years of propaganda
from the law firm that created ICANN and still serves ICANN (and is
still makes a lot of money from ICANN.)<br>
<br>
But the current effort at reform should use the current window of
malleability to demand that ICANN adopt a membership structure. But
that membership structure should not be this silly (and probably
not-viable) proposed system that is as overtly contrived as is
ICANN's present form.<br>
<br>
The California law of membership in public-benefit corporations is
good, it is easy, it is apt. It is such an obvious path that I
remain astounded at the level of effort being expended trying to not
follow it.<br>
<br>
--karl--<br>
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