Dear Malcolm, Dear Keith Dear All Thank you very much for your contributions. First I will comment on Malcolm,s position He indicated Quote *"I would say that it is the responsibility of the Board to find ways to reconcile the community consensus with their legal obligations. Normally this is done through a combination of engagement with the community (so as to relieve unrealistic or unachievable expectations) and creative approaches to implementation (so that the objectives of the community are met in a manner compatible other obligations, which may not be the implementation originally envisaged)."* Unquote Kavouss Comment 1.Since currently ICANN functions , amongs others, Under the Incorporation Articles and Californian Laws and Rules ,it is incumbent to it to respect those Laws and Rules, thus the pressure or the burden would be shifted to the community. Consequently ,the argument is not a balanced approach. This inconsistency between the communit6y consensus outcome and those Laws and Rules was raised before and is not yet resolved 2. Malcolm also said Quote *"These twin duties are, in my view, *both* fundamental. The latter should not be allowed to become an excuse for the Board to go its own way, in defiance of the community"* Unqupote Comment from Kavouss I fully agree with your analysis 3. Malcolm also POINTED OUT Quote "Ultimately, if a Board member believes they are incapable of satisfying all their duties, then their responsibility is to resign their office" Unquote Comment from Kavouss Here also I fully agree with the analysis . 4. The last part of Malcolms opinion is Quote *"The radical idea would be to propose that directors are entitled, in the final analysis, to advance their own preferences in defiance of the community they are appointed to serve"* Unquote Comment from Kavouss *Here I disagree with the analysis* Now on the Keith's position Quote "The radical idea would be to propose that directors

are entitled, in the final analysis, to advance their own preferences, OR THE PREFERENCES OF ICANN'S LEGAL COUNSEL, in"

Unquote Comment from Kavouss *Here also I disagree with the amendment made by Keith* Now on the Alan's position Quote *"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".* Unquote Comment from Kavouss It is not clear whether Alan in favour of Malcolm's views or against it The argument he made is a double face argument.,on the one hand he expressed worries about being sued and ,on the other hand, he refers to *A**rticles of *incorporation which includes the phrase "the corporation shall operate for the benefit of the internet community as a whole" There seems to be a need to clarify his position i.e in favour or anaist Malcolm’s views Tks Kavouss 2015-01-12 9:24 GMT+01:00 Edward Morris <emorris@milk.toast.net>:

I would like to strongly support Keith's proposal that we 1) request the ability to consult legal expert in California corporate law (as opposed to strictly nonprofit corporate law, as the new Benefits Corporation is a vehicle we may want to consider) and 2) we ensure the expert is not affiliated in any way with ICANN legal or any legal contractor, such as Jones Day, which has a a historical relationship with ICANN. To the extent any participant can or would be allowed to be involved in the process by which such an expert is selected, I certainly would like to be part of any such effort.

-----Original Message----- From: "Drazek, Keith" <kdrazek@verisign.com> To: Adebunmi AKINBO <akinbo.adebunmi@gmail.com> Cc: "accountability-cross-community@icann.org" < accountability-cross-community@icann.org> Date: Mon, 12 Jan 2015 04:57:27 +0000 Subject: Re: [CCWG-Accountability] Regarding role of Board directors

In response to Akinbo's question below, I would like to ask the Co-Chairs to add a discussion of expert legal advice to Tuesday's agenda.

I believe the CCWG will likely need our own subject matter expert in California not-for-profit corporate law.

It's probably time we discuss how best to secure these services and to ensure that individual is in the service of the CCWG and the community, so we are not relying only on ICANN's interpretations.

Thanks, Keith

On Jan 11, 2015, at 3:32 AM, "Adebunmi AKINBO" <akinbo.adebunmi@gmail.com> wrote:

+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@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 ‘ICANN’ as the corporation or the *community*, see ICANN’s own Management Operating Principles (2008 link <https://www.icann.org/en/system/files/files/acct-trans-frameworks-principles...>, 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@ipjustice.org> Date: Saturday, January 10, 2015 at 8:10 PM To: Bruce Tonkin < Bruce.Tonkin@melbourneit.com.au> Cc: " accountability-cross-community@icann.org" < accountability-cross-community@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 _______________________________________________ Accountability-Cross-Community mailing list Accountability-Cross-Community@icann.org https://mm.icann.org/mailman/listinfo/accountability-cross-community

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