Consultation: Constitution updates for Org Review - February 2018

Results of EGM decision held 19-22 March 2018

INZ Voting Results - March 2018 (PDF)

 

Following on the decision to implement the 2017 organisational review, there are some changes to InternetNZ's constitution required.

This consultation sought your feedback on these proposed changes. Input was due 14 February and has now closed. Council will be considering the input later in February and then seek member approval of final proposals in March.

There is a high threshold for constitutional changes - two-thirds of those voting need to vote in favour. Thank you to all of you for sharing your views on these proposals.

The changes

The key change proposed was to update composition of the InternetNZ Council as follows:

  • Moving from 12 elected Council Members to 9 Elected Council Members
  • Allowing for Council to choose up to two Appointed Council Members

The rationale of this change is to be able to add skills, or diversity, or geographic balance to the Council's membership, and address any governance gaps, without expanding the overall size of the governing body.  (A future consultation will be held on the policy guiding these appointments).

As well as the changes to how Council is made up, there is also some proposed adjustment to the Constitution which are as follows:

  • Clarification in the preamble of the Objects that InternetNZ is a charitable organisation and that we do not represent the interests of ISP’s
  • Setting the number of elected Council Members at 9 (including 2 Officers)
  • Establish an option to have up to 2 Appointed Council Members
  • Updates to ensure consistent use of the term “Council Member” rather than “Councillor”
  • Changes to clarify that Officers are limited to two full 3 year terms and that if an Officer is elected for a part term (through a by-election caused by a resignation) this does not count towards the two terms
  • Addition of Schedule 2 that describes the process for reducing the number of elected Council Members from 12 to 9 over the next few years

These proposals were open for comment until Wednesday 14 February at midday. Staff will now prepare a report on the comments for Council to consider in late February.

The decision process will be online and a quorum of two thirds of those voting on a constitutional change have to vote for it in order for it to pass.

Constitution - marked up (.pdf)

Constitution - marked up (.doc)


Comments received:

I don’t have a problem with the idea of appointed council members however I would like to see a bit more ability for members to vote (under 10.3.1.2 ) against the council members appointment before the appointment is allowed. For example

  • 6.8.2 The appointment (and removal, as the case may be) of Appointed Council Members requires six of the Officers and Elected Council Members to vote in favour of the appointment (or the removal as the case may be).
  • 6.8.3 For the first 45 days of a new Appointed Council Members term, they will only be allowed to observe meetings (as decided by the President or Vice President (if the President is unavailable)) and only have the same rights as a Financial Member.
  • 6.8.4 Financial Members must be notified of the appointment as per the terms defined in section 8 within 2 days of the decision. For the affordence of clarity the Financial Members may call for a vote as defined under section 10.3 and may overturn the councils decision. 
  • 6.8.5 After the initial 45 Day window the Appointed Council Member will have all the same rights and obligations as all other Council members, except that they may not vote on the appointment of other Council Members.

- Geoff Evans

 

It sounds very sensible to enable the Council to choose up to two Appointed Council Members to add skills, or diversity, or geographic balance to the Council's membership, and address any governance gaps, without expanding the overall size of the governing body.
I support the change.

- Mark Hogan

 

I am generally in support of the proposed changes.

  1. In clauses 6.1, 6.8 (but see paragraph 5. below) and 7.7, the term “from time to time” is unnecessary and should be deleted.
  2. The wording of clause 6.3 seems to me to be unclear, perhaps because it tries to deal with two distinct situations (ceasing to be the nominee of an Organisational member, and just not paying their Individual membership fee) all in one rather long and complicated sentence. Maybe this would be better as two subclauses.
  3. I don’t think that the addition of “with immediate effect” to the end of Clause 6.3 is an improvement. I think instead of that, inserting the word “then” so that the phrase becomes “, their elected position shall then be deemed to be vacated.” might be better.
  4. I think clause 6.7 might read more consistently with the rest of the document better if “fail to turn up to” were replaced by “fail to attend”.
  5. Reading clause 6.8 in the context of Schedule 2, it is evidently intended that Appointed Council Members are to be an ‘optional extra’. That being the case, then “can” should be replaced by “may”, and 6.8 should start “The Council may, as they see fit, appoint Appointed Council Members.”
  6. In clause 6.8.3, “Council Members” should be capitalised consistently: there are currently two “Council Members” and one “Council members”.
  7. In clause 6.9 “the Council can defer” should I think be “the Council may defer”, replacing “can” by “may”.
  8. In clause 7.6 “toi” should be “to”.
  9. I think that the references in clause 7.6.4 to “the Securities Act 1978” and “the Securities Markets Act 1988” are out of date – certainly I couldn’t find those Acts on Legislation.govt.nz, but IANAL so I don’t know exactly what replaced them.
  10. In Schedule 2 clause 3.4 there is an extra space between “and” and “the” in “the Officers and  the Council Member”

- Mike Henderson

 

I am very supportive of the change to reduce the number of elected Councillors from 12 to 9 and allow up to two co-options.

The change to term limits also seem sensible, but as a matter of principle I don’t think such a change would be retrospective.

There is one proposed change I do want to oppose, and I am surprised it has not been highlighted as a significant change. This is the change to Clause 6.1 which sets out the powers of Council.

Council is proposing deleting “in accordance with … the resolutions of Members of the Society in General Meeting”.

It looks to me that this would mean that an AGM or SGM could no longer direct the Council to a particular course of action. Taking this power away from members is major change and something that should have been highlighted and be subject to vigorous debate.

While there are pros and cons of allowing the members to direct the Council, I believe it is an important safeguard. If this power did not exist in 2000, we would not have the InternetNZ we have today. The fact the members were able to clearly direct the Council to implement the current SRS model for .nz meant that Council could then get on with it.

Removing this power would make it very hard for members to assert control of the society. With only a third of Councillors up for election every year, it would take at least two AGMs to get a majority on Council that was in line with what the members want.

I would ask that this change be a separate amendment/motion to the other changes so one can vote for the other changes but vote against this change.

I would also ask that the term limits change be a separate vote.

- David Farrar

 

Agree with David Farrar's comment (see above).

However I also stand against the proposal to reduce the number of elected councillors. For sure 12 in the  Council is unwieldy, but there are some significant benefits:

  • there is a greater opportunity for diversity, through sheer number of people around the table.
  • the number of candidates up for election each year is larger, so there is a greater chance of less mainstream candidates being elected. These could include people who are not incumbents, people who are known to a smaller percentage of members and people who have fans and detractors. With a reduced number of people to vote in at each election the power of incumbency could cement current members until they deign to depart.
  • the larger number of people allows a good range of skills and roles, and fosters change. Some people will be new, and learning the ropes of governance and InternetNZ, and asking the challenging questions. Others will be transitioning from newbies to solid contributors, taking on increasing responsibilities and creating real change. Others are the institutional memory, specialists in particular areas and so on. And the rest are on their final stages of the journey - having contributed, helped improve things and moving aside for the next wave of people. Lose three people and this all becomes harder - you don’t need many people to decide to stay for a bit long and the pace of change falters.

All of the above factors have been at play over the last 10 years, and the council has seen strong and continued improvement. It’s been wonderful to watch from both inside and outside. Let’s not change something good because it’s hard. 

I would also challenge the ability to select (not elect!) 2 additional councillors for specialties. I am a firm believer that specialists should be retained by a board/Council, not appointed to that board or council. The council could instead maintain a skills matrix and use it to let members know the gaps and strengths the council has before and after each election, and candidates can use their pitch to address whether or not they meet any of the unmet requirements. The council and members can also actively reach out to candidates who have the missing skills. 

Much of the review is excellent - but let’s not throw away some of the greatness of Council as we change.   

- Lance Wiggs

 

Thanks to David & Lance for kicking off a public discussion. My response follows:

  • I would like to see substantial changes put to members as separate items to approve, and not bundled together.
  • I support a reduction in the numbers of councillors to nine.
  • I don't support appointed council members.
  • I believe all elected members (councillors & officers alike) should be subjected to a limit of two terms. Consecutive or not. 
  • I support overlooking a part-term when considering term limits - in future cases.
  • I'm with DPF (David Farrar) in believing term limit changes should not apply to sitting officials.

- Jon Brewer

 

I like the idea of appointed councillors to address geographic balance in the council, and possibly diversity (although I think members have done a pretty good job on this).  However the changes in the constitution do not say this – councillors will be appointed to ensure an “appropriate mix of knowledge, skills and experience”.

I agree that any skills shortfall should be met by contracted advisors rather than appointed members.  If council has views on the specific skills that are needed at the governance level, that could be made that clear when elections are called.

I agree with comments on clause 6.1.

I also support the idea that material changes are voted on separately.

- Laurence Millar

 

I support a reduction in the number of councillors.  I take your points Lance but I think 9 is ample for what is a relatively small organisation, subject to my next two points.

I’m not against having non-elected councillors per se, but I am very much against governors appointing governors.  The danger of creation of a clique is real and I’ve seen it a number of times in organisations.  Appointees can feel beholden to their appointors and it is too easy for strong voices at council to have “clones” appointed.  If appointees are to be a thing, then it is critical that the appointments be made by an independent panel of which the majority are NOT councillors/officers and which operates with some published guiding principles.  This should be enshrined in the constitution.  At present, it is very unclear what the process is for appointments, which is most unlike INZ.  When do they get appointed? For how long?  How are they removed? Do they have to be a member first?  What are the guiding criteria?  Also, technically, there is actually no provision empowering appointment post 2020 as far as I can see.  More work required here I think.

The diversity points that Jay and others have raised are well made.  If there are issues with the voting system or any other aspect then these need to be fixed.  I’m not sure any risk has been borne out given the increased diversity of council over the past decade or so but if there is that potential then that is not a good thing.

I think the change at the start where the reference to being “representative of ISPs” has been deleted, goes too far.  Ultimately, it is true to say that internet users are at the forefront but there is always a balance to be had.  In some cases, the interests of ISPs, NZ Government, the ccTLD community as a whole, SMEs, large organisations, creative industry etc etc etc, need to be taken into account and “represented” in INZ’s overall position, particularly internationally.  I’d prefer that we hark back to Jon Postel’s RFC1591 https://www.ietf.org/rfc/rfc1591.txt, which has always been a touchstone for INZ, and so refer to the “local internet community” - one of those delightfully vague but nonetheless meaningful phrases (like “uncapturable”).  i.e. change to “internet users and the local internet community”.  I’d not want anyone in the LIC to think that INZ does not take account of and therefore represent its interests.

Knowing the people involved, I’m sure that the change to clause 6.1 that David highlights below was not intended to have that effect, which is why it has not been flagged.  The point is well made though, thanks David, and your history lesson is a cogent one.  I’m not sure the change actually does remove member power, but, unlike the Companies Act which has specific rules dealing with shareholder binding proposals and resolutions for companies, the Incorporated Societies Act is opaque on this issue.  To save any doubt on this important issue, I agree that there should be a clear statement that a members’ resolution can dictate to council and bind the Society.  It’s the ultimate safeguard.

I also agree that substantive changes should be voted on separately.  These are quite disparate changes and people may want to vote for some and against others.  As far as I can tell, they can be voted on separately without destroying the meaning if one that gets through and another does not, but that needs to be checked obviously.

Couple of minor things I did notice.  In response to Mike’s point about the Securities Act 1978 no longer being in force - that has been replaced by the Financial Markets Conduct Act 2013 but check if that is still relevant to the particular provision in the constitution.  I also spotted a reference to the Institute of Chartered Accountants somewhere.  The NZ and Australian orgs merged a while back so it’s now called Chartered Accountants Australia and New Zealand (CAANZ).

- Rick Shera