On 11/22/19 2:32 AM, Evan Leibovitch wrote:
The sad truth is that ICANN (and as we've found out recently, ISOC) have no actual external stakeholders. In a for-profit the fiduciary duty is to stakeholders. In a normal nonprofit the fiduciary duty is to the stakeholders. In ICANN and ISOC, there is no external accountability so the fiduciary duty is soley to the institution itself. If this is an innovation of governance it's one I can do without.
Wow, you, Alan, and I all in general agreement! This is a rare (and positive) event that ought to occur more often. ;-) One minor nit. In a regular corporation the duty of directors is to take actions (or refrain from actions) with the goal of improving the corporation. What that means is as vague as it sounds. But it does not mean what some have described as "increasing shareholder value", although that can certainly be a consideration. In a public-benefit/non-profit such as ICANN is under California law the duty of directors is slightly different. Again the goal is to act (or not act) in order to benefit the corporation. But the measure in this case must necessarily include consideration of how the public benefits from that act/non-act. In other words, a director's duty must ask how well the corporation is acting to benefit the public. That's also a quite vague standard. And the sense of "public" is broad, in that it means the entire public not just a narrow selection of "stakeholders". Yeah, this seems hyper technical and, at the same time, very vague. But the distinctions are important and need to be recognized as part of the calculus that directors have to use when making decisions even if at the end the result in a given decision are the same. Directors of non-profits are under great personal risk (to their personal assets) should they fail to exercise these duties. (Some rules, such as the US IRS's rule about "intermediate sanctions" are utterly Draconian.) As a board member in ICANN and elsewhere I find it useful to go through a little process in which I write down, in a ledger or in the minutes, the reasoning for any particular decision, revealing the evidence, the criteria used to measure that evidence. That creates a thing called a "business judgement" which can not only be a defense but also tends to induce better decision making. --karl--