SUMMARY: CONFLICTS OF INTEREST AND ETHICS PRACTICES REVIEW

Transcription

1 SUMMARY: CONFLICTS OF INTEREST AND ETHICS PRACTICES REVIEW As a result f heightened attentin and scrutiny placed n hw the ICANN Bard addresses cnflicts f interest, and n enhancing ICANN's ethical culture, ICANN perfrmed a cmprehensive three-phase review f its Cnflicts f Interest (COI) and Ethics practices t imprve upn its already rbust cnflict f interest plicy and cde f cnduct. The gals f the review were t enhance ICANN s COI Plicy t mre clearly address hard cases and perceptins f cnflicts, enhance and imprve the Cde f Cnduct, and take steps fr ICANN t meet the highest standards f ethical practices. The wrk was cnducted with versight frm the Bard f Gvernance Cmmittee (BGC); all decisins were apprved by the full Bard. A detailed discussin f the scpe and results f each part f the review prcess is prvided belw. Generally, Phase One invlved a review and analysis by utside cunsel (already familiar with ICANN s f ICANN s current wrking dcuments, including the Cnflicts f Interest Plicies, Cde f Cnduct and Emplyee Handbks, amng ther dcuments, t enhance the fcus n best practices fr cnflicts and ethics. Phase Tw cncerned a review cnducted by a new independent law firm (nt invlved in ICANN prcesses) f ICANN s dcumentatin and cmparisn f ICANN t similarly situated nn-prfits and making recmmendatins fr enhancements. Phase Three invlved a review and recmmendatins frm an internatinal expert grup fr the enhancement f ICANN's ethical culture, drawing n internatinal surces, including practices in ther nt-fr-prfit rganizatins. Essentially all f the recmmendatins received in all three phases f this wrk have been adpted by ICANN and placed int plicies, prcedures, guidelines and/r prcesses, as apprpriate, which are nw applicable in varying degrees n ICANN Bard members, staff members and stakehlders. I. PHASE ONE Phase One f the review prcess invlved wrking with ICANN utside cunsel t review ICANN's crprate gvernance dcuments that were in place at the time and t make recmmendatins as t hw these culd be imprved in light f best practices in crprate gvernance, while still reflecting the needs f ICANN. In this regard, ICANN engaged utside cunsel Jnes Day, which is already familiar with ICANN, t perfrm a hlistic review f ICANN s plicies and practices. This review prduced recmmended mdificatins t the ICANN Bard Cnflicts f Interest Plicy, the Cde f Cnduct and Expected Standards f Behavir; the mdificatins were apprved by the ICANN Bard n 6 May The Bard als apprved new Crprate Gvernance Guidelines, a flexible framewrk dcument that cllects the surces f crprate gvernance requirements that ICANN fllws. The revised dcuments were psted fr public 1 See annuncement f Bard apprval f revised dcuments, psted at

2 cmment in March 2012 at and are described belw. 2 Crprate Gvernance Guidelines. The prpsed Guidelines are intended as a cmpnent f the flexible framewrk within which ICANN s Bard f Directrs (the Bard ), assisted by its cmmittees, directs the affairs f ICANN. The Guidelines als prvide ICANN stakehlders with a surce f reference t ICANN s gvernance plicies. Cnsisting largely f existing ICANN plicies and practices that are cntained in ICANN s Bylaws and cmmittee charters, the Guidelines cnslidate numerus ICANN gvernance plicies and practices, including thse related t the rle f the Bard, structure f the Bard, accuntability and review, perfrmance evaluatins, Bard cmmittees and Bard cmpensatin. As nted in the Guidelines, the dcument may address even mre issues in the future; the Guidelines will be reviewed peridically by the Bard and revised as apprpriate t reflect the dynamic and evlving prcesses relating t the peratin f the Bard. Cnflicts f Interest Plicy. ICANN s Bard Cnflicts f Interest Plicy (the Plicy ) utlines the prcedures fr disclsing and addressing cnflicts f interests f directrs, liaisns, fficers and key emplyees (cllectively, Cvered Persns ). The key revisins t the Plicy are as fllws: Strengthens prcedures fr disclsing, prcessing and evaluating actual and ptential cnflicts f interest. The Plicy requires Cvered Persns t initially disclse any cnflicts f interest t ICANN s General Cunsel, wh will infrm the Bard Gvernance Cmmittee and facilitate the review and evaluatin f the cnflict by the Bard Gvernance Cmmittee and the Bard. Expands n the disclsure requirements f matters that may give rise t Cvered Persns being perceived t have cnflicts f interest t include plicies and prgrams and ther matters. Cntinues t require that cnflicted Cvered Persns refrain frm using their persnal influence (either at r utside a Bard meeting) t influence ICANN s handling f a matter that gives rise t the cnflict f interest. Reiterates that cnflicted directrs and liaisns may nt participate in Bard r cmmittee deliberatins cncerning the matter giving rise t the cnflict f interest, unless either the Bard r BGC determines that the cnflicted directr r liaisn shuld participate in the discussins and in what manner. As always, n cnflicted 2 A detailed explanatin f the hw each f these fur revised dcuments apply within ICANN was prvided in Mem re Gvernance Materials psted at 2

3 directr may vte n a matter fr which the directr is cnflicted. Mre strngly emphasizes the cnsequences fr a Cvered Persn s failure t cmply with the Plicy. The revised Plicy specifically states that if the BGC determines that a directr r liaisn has intentinally failed t disclse a ptential cnflict f interest, the BGC will make recmmendatins t the Bard fr crrective actin, which culd include remval f the directr r liaisn frm the Bard. Bard Cde f Cnduct. ICANN s Bard Cde f Cnduct prvides directrs and liaisns with guidance with respect t their respnsibilities and duties as Bard members. The Bard Cde f Cnduct prmtes and supplements the standards f behavir expected f directrs and liaisns set frth in ICANN s Expected Standards f Behavir. The gal is t ensure that directrs and liaisns strive t fster ICANN s missin and cre values in an ethical manner. The revised Bard Cde f Cnduct sets frth additinal prvisins guiding the expected cnduct f directrs and liaisns. Expected Standards f Behavir. ICANN s revised Expected Standards f Behavir cntain additinal principles f expected behavir fr all parties invlved in ICANN s multi-stakehlder prcess when participating in ICANN matters. II. PHASE TWO Fllwing the adptin f the crprate gvernance dcuments frm Phase One, ICANN engaged Cley LLC, a law firm with expertise in crprate gvernance issues and that is new t ICANN, t perfrm a review f and prvide recmmendatins fr imprvements f ICANN s crprate gvernance practices. Specifically, Cley was tasked t review, at a high level, certain standardized rules and practices related t crprate gvernance in the United States and in Eurpe and briefly cmpare thse rules and practices t ICANN s Gvernance Dcuments. Cley prduced tw reprts: First Reprt n Crprate Gvernance (3 Octber 2011, revised n 27 April 2012) ( First reprt ) and Secnd Reprt n Crprate Gvernance (17 April 2012) ( Secnd Reprt ) The actin items arising ut f Cley s First Reprt, including cmpiling ICANN's crprate gvernance dcument in ne sectin f the ICANN website and prviding dates f amendment fr dcuments such as the Cde f Cnduct, were adpted and implemented sn after the First Reprt was issued. Fllwing the First Reprt, ICANN asked Cley t review the crprate gvernance plicies f: (i) leading internatinal crpratins, (ii) a leading internatinal institutin; and (iii) an internatinal institutin experiencing prblems stemming frm its crprate 3

4 gvernance plicies (cllectively, the Cmparisn Grup ), and t cmpare each f thse entities crprate gvernance plicies t the Gvernance Dcuments t identify areas f ptential imprvement. Cley cnducted a cmparative review f ICANN's dcumentatin t the gvernance dcumentatin f the fllwing leading institutins: (i) Internatinal Business Machines Crpratin ( IBM ), (ii) the Internatinal Finance Crpratin ( IFC ) and (iii) the Fédératin Internatinale de Ftball Assciatin ( FIFA ). In its findings set frth in the Secnd Reprt, while Cley nted that ICANN's plicies are aligned with essential gvernance principles, it als nted that there may be rm fr imprvement. Tw specific recmmendatins fr imprvement fllwed: (i) ICANN shuld cnsider revising its guidebk fr emplyees t ensure that plicies cvering unethical behavir and cmplaints are satisfactrily cvered; and (ii) ICANN shuld cnsider adpting a plicy t deal with repeat ffenders f its ethical and gvernance standards. In respnse t the Secnd Reprt, ICANN has wrked with utside cunsel t review and update its emplyee plicies and prcedures, including its internal staff cnflicts f interest plicy in view f Cley's recmmendatins. Further, n 18 Octber 2012, ICANN adpted revised Gvernance Guidelines ( taking recmmendatins frm the Secnd Reprt int accunt, as well as recmmendatins frm Phase Three as explained belw. III. PHASE III In Phase Three, ICANN engaged a team f internatinal ethic experts t review and make recmmendatins regarding ICANN s ethics, cnflicts and gvernance mechanisms, particularly fcusing n ICANN s glbal functin and the best practices f ther internatinal rganizatins. The team (the Internatinal Expert Grup ), cmprised f Jermyn Brks (frmer Wrld Chair f Price Waterhuse; currently Bard member f Transparency Internatinal and Chair f its Business Advisry Bard; Chair f the Glbal Netwrk Initiative), Mervyn King (ex-judge frm Suth Africa, a highly prminent name in crprate gvernance wrldwide, currently hnrary chair f the Glbal Reprting Initiative and Chair f the Internatinal Integrated Reprting Cuncil) and Arn Cramer (president and CEO f Business fr Scial Respnsibility, prlific speaker and writer n crprate respnsibility and sustainability issues as well as advisr t many cmpanies including the ICT industry). On 23 June 2012, ICANN psted the Final Reprt by Internatinal Expert Grup ( Expert Reprt ) at The Final Reprt was psted fr public cmment in June 2012 at 05jun12-en.htm and discussed at a public sessin n 25 June 2012 at the Prague Meeting. As nted abve, ICANN revised the Crprate Guidelines ( t address the recmmendatins in the Expert Reprt. Further, with respect t items that are nt directly fund in the 4

5 Gvernance Guidelines, the Bard has undertaken t ensure that additinal wrk is being cnducted. Fr example, the Bard nw regularly includes in its advice t the Nminating Cmmittee that experience in rganizatins f similar size, scpe and purpse are desired selectin criteria fr Bard members. And in line with a similar recmmendatin frm the first Accuntability and Transparency Review Team, the Bard is nw fcused n training, including specific training related t cnflicts f interest. T that end, the Bard participated in a cnflicts f interest training sessin tailred fr ICANN during a wrkshp in early IV. ON-GOING ACTIVITIES When adpting the revised Crprate Guidelines t address recmmendatins frm Phase Tw and Phase Three referenced abve, the Bard made clear that this is nt the end; the Bard will regularly cntinue t evaluate bth ICANN staff and Bard members t ensure that ICANN is perating t the highest ethical standards. (See These nging effrts have thus far manifested in varius ways including, but nt limited t: (i) the specific cnflicts f interest training as mentined abve and specific nline training prgrams that are in develpment; (ii) a review f all f the gvernance related dcuments and evaluatin f all reprted cnflicts cntinues t be part f the Bard Gvernance Cmmittee s (BGC) nging and regular wrk; and (iii) as it relates t the New gtld Prgram: (a) the Bard Reslutin n Bard Member Rules n Cnflicts f Interest fr new gtlds relating t pst Bard-service cnduct ( 3 ; (b) the Bard established the New gtld Prgram Cmmittee t make decisins regarding the Prgram, which cnsists f all Bard members nt cnflicted (whether actually, ptentially, r perceptually) n new gtld related matters; and (c) the BGC established a sub-cmmittee f nn-cnflicted members t address any and all reprted actual r ptential (including perceived) cnflicts f interest that might be related t new gtlds. These activities are just sme that shw hw the Bard cntinues t be cmmitted t perfrming under the highest ethical standards. 3 Nte that n pst-service limitatin rules can be applied t staff given the legal prhibitin t such arrangements. See Califrnia Business and Prfessins Cde, sectin