Rational Rules Beget Rational Behaviour

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If you follow the Internet governance world like I do, you’ve no doubt had time to ponder the news of former ICANN Board Chair Peter Dengate Thrush’s appointment as Executive Chairman of Top Level Domain Holdings Limited (TLDH). This was a seemingly fast jump from the body that coordinates the Internet (whose most recent milestone was to approve the creation of new gTLDs) to one of the key companies that stands to actively benefit from this burgeoning part of the domain name industry. Further, he’s taken up a position that, according to reports, will allow him to benefit substantially as well.

I’m not sure I could sum up the situation better than Antony Van Couvering, CEO of TLDH, who said on the company’s website:

“Peter championed successfully the approval of the new gTLD programme at the highest levels and with Peter on board I have every confidence we will achieve the same success at TLDH.”

Peter seems to have made a shrewd decision in taking on his new role with TLDH.  And, it would seem that Antony made an excellent choice in securing someone with the depth of experience and knowledge that Peter has. And frankly, who among us would pass up such an opportunity? Likely not I.

Let me state upfront that there’s nothing in the ICANN rules that precludes Board members from advancing their career in any way they choose once they have left ICANN’s Board.

What we have here are rational actors acting rationally under the existing rules.

That said, the time has come in the evolution of the Internet to more closely scrutinize the free flow of key industry influencers. They can currently move from organization to organization without the constraints of non-compete and governance rules regarding employment in the industry after leaving ICANN. In my opinion, what may have been fine for a young, immature sector surely cannot continue. We are talking about increasingly large flows of money changing hands and with that comes the possibility of material conflict.

Perhaps we can take some important lessons from the private sector, government and regulatory bodies, and I would argue, apply them to the ICANN model. After all, I believe it is important to create a dynamic organization where good people (and remember, ICANN’s Board is largely volunteer-based) are protected from being put in harm’s way leading to undue temptation.

The World Bank is an excellent example of an agency that has financial influencers coming and going all the time. The Bank sets very high standards for ethical practices for both existing and exiting Board members. Their Code of Conduct clearly spells out to a number of points, including requirements on employment once a director leaves the Bank.  Here is one of the key statements that really resonated with me: “For a period of one year following the end of service as a Board Official, a Board Official shall recuse himself or herself from involvement in or influence on matters related to the Organizations’ dealings with his or her future employers.”

In Canada, we have seen similar rules imposed through the Conflict of Interest Act on departing federal public officer holders, Ministers of Parliament and their staff.  Amongst other things, a key purpose of the Act is to, “establish clear conflict of interest and post-employment rules for public office holders.” Specifically, Part 3 places a number of restrictions on public office holders once they leave office.

If you were to consider this to be the extreme end of the accountability spectrum and ICANN to be at the other end, I would argue that there is a great deal of space in which to find a more appropriate balance for the body that governs the Internet. At a bare minimum, a cooling off period is more than reasonable and a common practice in most industries. Ideally, I would like to see clear post-employment rules for ICANN Board members, as well as staff.

Interestingly, ICANN accepted the recommendations of the Accountability and Transparency Review Team (ATRT) earlier this year. Fundamentally, the ATRT is the body tasked with making sure ICANN does the job it is mandated to do, and does it in an open and consultative manner. The ATRT review is a lengthy process that takes place every three years. Unfortunately, although the ATRT examined many aspects of Board decision-making, the issue I have raised in this post was not among the many items considered in the review.  I would strongly recommend that the issue of departing Board members and conflicts of interest be closely examined as part of the next round slated to begin in 2013, if not sooner.

What do you think? Does ICANN need to evolve its code of conduct?

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  • Roelof Meijer, CEO SIDN

    An excellent piece of work, Byron.
    There is indeed nothing in the ICANN rules that precludes Board members from advancing their career in any way they choose once they have left ICANN’s Board.
    However, good governance and a high level of personal integrity are more than just (not) doing what codes, procedures and bylaws say you should (or can’t). Especially not in a sector that is so proud to be self regulated, transparent and accountable.
    Regrettably I would say, but yes, ICANN needs to work on it’s code of conduct.

  • http://TheBigLieSociety.com Jim Fleming

    http://TheBigLieSociety.com

    It Seeks Overall Control – Follow the Money

    http://TheBigLieSociety.com

    P.S. Current ICANN Board Members, Staff and their “Friends” benefit from the trumped up artificial scarcity projects and FUD such as DNSSEC.

  • http://TheBigLieSociety.com Jim Fleming

    .PS
    .BTW

    1244 registrations:

    What do ALL these people do ?

    https://www.ietf.org/registration/ietf81/attendance.py

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  • Young-eum Lee

    Agree with Roelof. An excellent review of the situation. It seems that the general rule is you can work there, as long as you are not involved in matters dealing with the former organization.

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  • http://www.facebook.com/profile.php?id=100003406630011 Monserrat

    The days of english doitanming the internet world is gone for good. I think just the Chinese market alone will outdo the entire english one!This is a great opportunity to explore new frontiers in the internet world, and there is definitely some money to be made here. I do think that speaking the native tongue and knowing the customs will be a huge advantage in identifying power keywords to use in URLS. If you can\’t, then employ somebody that does. You\’ll end up making better, more informed choices.