2002 Evolution and Reform Process

The 2002 Evolution and Reform Process was an ICANN Board-led reform process that resulted in the adoption of substantial reform in the bylaws, structure, and operation of ICANN.

Outcomes

The Evolution and Reform Process generated massive change in the structures of the ICANN community, as well as the organization and operations of the ICANN board and organization. Notable changes included:

• the creation of the Ombudsman's Office;
• the enshrinement of ICANN's mission and core values into the ICANN Bylaws;
• the overhaul of the bylaws, generally;
• the creation of the ccNSO;
• the creation of the ALAC;
• the transformation of the DNSO into the GNSO;
• refinement of ICANN's Policy Development Process; and
• reform of the Nominating Committee.

Background

ICANN was incorporated in 1998 and entered into a Memorandum of Understanding with the Department of Commerce in November of that year to begin a joint project to manage the domain name system in a way that promoted the principles of stability, competition, private, bottom-up coordination, and representation of all views among the global and diverse community of Internet users and functions.

Initial Structure and Growth

In March 1999, ICANN amended its bylaws to establish a new supporting organization, the Domain Names Supporting Organization (DNSO). As amended, the bylaws contemplated the following structure of ICANN and its SOs and ACs:

• Three Supporting Organizations: Address Supporting Organization (ASO); Domain Name Supporting Organization (DNSO); and Protocol Supporting Organization (PSO).
• Four Advisory Committees: Governmental Advisory Committee (GAC); Root Server System Advisory Committee (RSSAC); an Advisory Committee on Membership (until such time as the board established rules for At-Large director seats on the board); and an Advisory Committee on Independent Review (until such time as the board adopted procedures for independent review).

In the March 1999 amended bylaws, only the DNSO had defined procedures established for its operation. The ASO and the PSO sections of the bylaws were reserved. ICANN and the PSO signed a Memorandum of Understanding in July 1999, amended bylaws of August 26, 1999, included procedural and operational guidelines for the PSO. In October 1999, the three existing regional internet registries - RIPE NCC, APNIC, and ARIN - entered into a Memorandum of Understanding with ICANN as well, resulting in the creation of the ASO. The addition of the ASO to the bylaws occurred at the end of October.

Perceived Need for Reform

In November 2001, the ICANN Board created a Committee on Restructuring to investigate possible reforms to ICANN's structure and operations. The resolution forming the committee also instructed the ICANN President (at the time, M. Stuart Lynn) "to take such steps as he deems appropriate to bring to the Board for its review and approval recommendations for how best to reaffirm and clarify the nature and scope of ICANN's limited mission." The board cited "ongoing considerable discussion in the ICANN community, including a number of the DNSO constituencies, about the desirability of possible changes in the structure of ICANN, including consideration of possible new Supporting Organizations and changes in the composition of the ICANN Board;" as well as the fact that "ongoing evaluation of the ALSC Final Report also implicates issues of ICANN structure and Board composition" as factors in taking these actions.

In February 2002, Lynn published his report and proposal for comprehensive reforms of the ICANN structure, board, and operations. Prior to publication, the reform report and proposal was presented to the ICANN Board during its retreat in Washington D.C. The report makes the case for "deep, meaningful, structural reform, based on a clearheaded understanding of the successes and failures of the last three years." Lynn's proposals included:

• Reformation of the ICANN Board.
• Reform of ICANN's Policy Development Structure and Process:
  • Three Policy Councils - Address & Numbering, Generic TLDs, and Geographic TLDs;
  • Two Advisory Committees - Technical and Governmental;
  • Two additional Standing Committees - Security Committee, and Root Server System Operations Committee; and
  • Participation in Councils by self-organized forums, including possibly an At-Large organization for internet users.
• Transparency and Accountability reforms: the creation of the Ombudsman's office, and a "Manager of Public Participation" role.
• Funding reforms - dramatically increase funding from governmental and non-governmental sources, including contributions for core functions and fees for services.

Public comment on the President's Report was extensive, with varying degrees of agreement, civility, and objection.

In response to Lynn's report, the board made a number of resolutions at its meeting at ICANN 12 in Accra, Ghana:

• the Committee on Restructuring was renamed the Committee on Evolution and Reform;
• the committee was tasked to provide a report to the board outlining a "framework for the structure and functioning of a reformed ICANN, and a timetable for implementing that framework" in time for the ICANN 13 meeting in Bucharest;
• the committee was to ensure that they addressed and recommended resolutions for a broad range of issues, including both structural and operational considerations for the proposed reformed structure, transition of existing structural components, and ensuring adherence to ICANN's core mission and objectives;
• the board strongly encouraged public comment on reform proposals as well as all activities and recommendations of the committee; and
• the committee was instructed to work with Lynn and ICANN staff to develop its recommendations for reform.

These actions kicked off what would come to be known as the Evolution and Reform Process. The board expressed a desire to engage in deliberations on a set of proposals for reform at ICANN 13 in Bucharest, and that any materials to be presented at that meeting should be published for public comment no later than May 31, 2002.

Evolution and Reform Committee Working Papers

The Evolution and Reform Committee (ERC) began work in the spring of 2002. The ERC presented an interim report on progress to the Board in April 2002, stating that it was making strides in gathering public opinion across a variety of fora, including personal communications to committee members. The report provided an "idiosyncratic" overview of the public input received around many of the features and talking points of Stuart Lynn's proposals for reform. The Committee chair, Alejandro Pisanty, emphasized that none of the community input and discussions could be characterized as conclusive.

In May 2002, the ERC released a series of working papers on ICANN's mission & values, its policy development process, and its structure & the nominating committee concept. The papers were intended to capture the current state of ICANN and its written and unwritten rules, and to spark community contributions and discussion on each of the issue areas being addressed by the ERC.

ICANN Mission

At the time of the ERC's work, neither ICANN's mission nor the organization's values were described in the bylaws. In response to the call to articulate ICANN's mission, ICANN staff produced a document that described "What ICANN Does" "to provide a beginning point for that discussion by enumerating the most significant activities that ICANN does today." The ERC created a draft mission statement and core values based on a wide variety of documents and agreements, most importantly the White Paper, the 1998 Memorandum of Understanding with the Department of Commerce, the IANA Contract, and the Memorandum of Understanding between ICANN and the IETF. The draft mission statement identifies ICANN's mission as "coordinat[ing] the stable operation of the Internet's unique identifier systems," including the allocation and assignment of domain names, IP addresses, autonomous process addresses, and protocol port and parameter numbers, as well as the operation and evolution of the DNS's root name server system. The working paper also identifies an array of "core values," although some of the listed values are more akin to operational mandates.

The Mission & Core Values working paper received 9 comments. The comments varied widely in terms of support for the draft mission statement and values. Some commenters noted that the representation of all members of the multistakeholder community was not mentioned; rather the core values identified "inclusivity" of diverse viewpoints.

Policy Development Process

The results of ICANN's policy development process to date in 2002 was, in the view of the ERC, "at best uneven, with the predominant outcomes slow or exceedingly general or both." In its discussion of the standards of decision-making, the ERC further described some of the issues facing ICANN's policy model to date:

The results to date are mixed. ICANN has been very effective in some areas, notably the introduction of competition at the registrar level, the establishment of new TLDs, and the creation of an efficient, non-binding dispute resolution process. But in other areas, ICANN has been less effective. In particular, ICANN has not always demonstrated the ability to come to decisions on issues of interest to some or all of its constituents, with the result that the consequence is often no action – by default rather than through a conscious choice of the Internet community.

The paper went on to identify the challenge of reaching consensus as a primary roadblock to efficient and effective decision-making. Noting that the word "consensus" did not appear in the ICANN bylaws until the March 1999 amendments that created the DNSO, the ERC nonetheless accepted that consensus policy was an important concept, both in the spirit of ICANN's multistakeholder model and in terms of ICANN's Registry Agreements.

Balancing the equities, the ERC proposed an approach toward consensus that creates checks and balances against the exercise of either a de facto veto on the part of individual constituencies (by refusing to join a "consensus" proposal), and top-down imposition of policy by the board:

Thus, a reasonable solution would be to have ICANN seek consensus whenever possible in developing policies, through processes and procedures that insure that all views of those affected are heard and that are open and transparent, and then to allow the ICANN Board to decide the issue based on its educated perception of the best interests of the whole community. To ensure that the ICANN Board did not lightly disregard any policy recommendation from a constituent entity, ICANN's bylaws could require only a simple majority to accept a properly documented consensus recommendation from such an entity, and a supermajority (two-thirds?) to take action that was significantly inconsistent with such a recommendation. This would preserve the incentive of all parties to work toward consensus solutions but allow the Board (assuming a Board selection process that produces a broadly representative Board) to exercise its good judgment. If a supermajority provision was included in the bylaws, and if an independent review process or some similar mechanism existed, there would be a review to ensure that standard was met.

The ERC also outlined a uniform procedure for policy-making that is quite familiar to the modern-day policy development process:

• PDPs should be initiated by supporting organizations or at the request of the board, delegating the PDP to a specific SO or cross-community working group;
• A specific timeframe for the PDP working group or task force to gather input from the community and other relevant sources;
• A draft report, stating the basis for any recommendations, the steps taken to gather community input, the proposed policy or recommendations, along with a timeline regarding those recommendations, and an opportunity for dissenting opinions to present their rationales;
• A public comment period on the draft report; and
• A final report presented to the board for action.

Public comment was again sparse, with seven submissions from five commenters. Comments ranged from statements that the paper was a "load of verbose waffle" to more substantive discussions of the issues raised by the paper, building on the ERC's recommendations and proposals.

ICANN Structure & the Role of the NomCom

The working paper on ICANN's structure and the NomCom addressed Dr. Lynn's proposal directly and elaborated on the justifications for the structural reforms proposed in the President's Report. It spent far less time than the other working papers investigating the status quo and the need for reform, because "there appears to be widespread agreement that the problems identified in the Lynn proposal are accurately described," and so the ECR proposed to "accept that description as a base for examining proposed changes." As a result, the working paper is largely designed to call for responses to specific issues and elements of the Lynn proposal. Under the ERC's view of the reformed structure,

In sum, this intermediate structure would produce seven ex officio Board seats – four voting (APC, GNPC, CNPC and TAC) and three non-voting (GAC, Security Committee and RSAC), all filled without the participation of the NomCom. If we assume a Board with fifteen voting members – which seems desirable since that is close to the upper edge of effective size – and the CEO retains a voting ex officio seat, that would leave ten Board seats to be selected by some other means.

The "other means" was examined in the second section of the working paper. The ERC, noting that criticisms of the current Nominating Committee structure were valid, made the following recommendation for public comment and critique:

We would like to solicit comments on the following concept: a NomCom consisting of delegates from identified constituencies (possible examples would be such groups as registries, registrars, RIRs, large business users, consumer organizations, academic or other non-commercial organizations, etc.)...We use the word "delegate" intentionally. For ICANN to be the most effective organization it can be, its Board should be as neutral and objective, and as capable, as is possible under the circumstances. We do not believe that a Board composed primarily of representatives of specific interested groups is the best way to reach this goal. By contrast, we believe that a Board composed of persons with diverse skills and perspectives and the right personalities, that can act collegially and effectively to make decisions that are grounded in the best interests of the overall communities affected would serve both the public interest and the long-term interest of all direct participants in ICANN.

This proposal, in the view of the ERC, presented an opportunity for a Nominating Committee that would select board members through the lens of improving the common good, even if their own perspectives on the common good originated from a specific point of view. The NomCom proposal, as well as all the others, were presented "in an effort to focus the community debate on more detailed and particular issues given the extreme time pressure that we are all working under."

The working paper on the ICANN structure received twice the comments of the other two working papers: a total of twenty comments from eleven contributors. Some responses engaged with specific questions posed by the ERC, while others provided more generalized responses to the paper and its proposals.

The Blueprint for Reform

After receiving the comments on its working papers, and continued refinement of its proposals, the ERC published its recommendations to the ICANN board, and summarized those recommendations in its "Blueprint for Reform." The blueprint provided the following recommendations regarding each of the topic areas of Lynn's reform proposals:

Mission & Core Values

The proposed Mission Statement and Core Values were largely unchanged from the working paper, with some refinements to the core values based on comments received.

Structure & NomCom

The proposed structure "tracks in principle" with the working paper on ICANN Structure, with some alterations based on comments received:

Board

• 15 directors, with two seats nominated by each of the supporting organizations, eight seats nominated by the NomCom, and a seat for the President of ICANN;
• 5 non-voting liaisons, selected by the GAC, the IAB/IETF, the RSSAC, the SAC (now SSAC), and the Technical Advisory Committee;
• Three-year terms, staggered so that one-third of the voting members rotate annually, and with a limit of three consecutive terms;
• Guidelines for the Nominating Committee to employ in the selection of board members, which should also be heeded as applicable by the supporting organizations:
  • broad functional diversity in areas of expertise relevant to the work of ICANN;
  • geographic and cultural diversity;
  • a capacity to understand the global impact of ICANN's mission and work;
  • ability to contribute to the overall credibility of the board; and
  • personal characteristics such as "integrity, objectivity, intelligence, demonstrated capacity for thoughtful group decision-making, and willingness to fulfill the responsibilities of a Board member."

Supporting Organizations and Advisory Committees

The ERC proposed three supporting organizations: the Generic Names Supporting Organization, the Country Names Supporting Organization, and the Address Supporting Organization. The Protocol Supporting Organization would no longer exist; instead, the Technical Advisory Committee (described below) would be created to provide technical support and guidance to the board. It would be comprised of, "at a minimum...should they wish to participate, two delegates from each of the four organizations that currently comprise the PSO (the IETF, the ITU, ETSI, and the W3C), and three members with a strong technical background appointed by the NomCom."

In addition to the SOs, the ERC proposed four advisory committees: the GAC (Government Advisory Committee), the TAC (Technical Advisory Committee), the RSSAC (the DNS Root Server System Advisory Committee) and the SAC (Security Advisory Committee).

Nominating Committee

The Nominating Committee, as initially proposed in the working paper, was structured to provide the broadest range of expertise directed at the overall goals of common good and public benefit: "One of the underlying principles of the NomCom is that its very functional and geographic diversity would tend towards the selection of Directors and persons filling other positions who are broad in outlook, individually and as a group, and not beholden to particular interests."

The proposal outlined the following structure and composition for the NomCom:

The NomCom would initially be a 19-member body composed of delegates (not representatives) appointed by the following constituencies:

• gTLD registries (1)
• gTLD registrars (1)
• ccTLD registries (1)
• Address registries (1)
• Internet service providers (1)
• Large business users (1)
• Small business users (1)
• IP organizations (1)
• Academic and other public entities (1)
• Consumer and civil society group[s (1)
• Individual domain name holders (1)
• IAB/IETF (1)
• TAC (1)
• GAC (1)
• Unaffiliated public interest persons (4)

In addition, there would be a Chair appointed by the Board and 2 non-voting liaisons, one from each of the RSSAC and the SAC. The above represents a workable balance among providers, users, and technical and public interests.

The proposal identified a need for the ICANN Bylaws to require, to the extent feasible, geographical and cultural diversity and balance in order to support diverse and representative appointments to the board and other organizations. It also placed a single-term limit on NomCom members and a one-year ineligibility period for former NomCom members before they can be selected for service on the ICANN board.

Policy and Process

Drawing on the discussions generated by its Working Paper on ICANN's Policy Development Process, the ERC provided guidelines for policy development reform and refinements. The ERC emphasized that the board's role was not merely to enact "consensus" policies created by the SOs: "The Board has a fiduciary responsibility to make decisions on the basis of good faith judgment in furthering the public interest." Nonetheless, wherever possible, the goal of the board would be to foster an environment that seeks consensus in policy deliberations. The ERC's definition of "true consensus," "a policy acceptable to the great majority of those affected, with no strong and reasoned opposition," served as the benchmark for situations in which the board could only override the consensus by a supermajority vote.

The procedural proposals for policy-making were similar to the ERC's working paper, suggesting that most policy development would require delegation of policy-making to the relevant SO, establishment of timeframes and scope, public comment opportunities for the draft recommendations and possibly the board's intended actions, and opportunities for the board to consult with other bodies such as the GAC regarding policy recommendations.

Accountability

The ERC made several recommendations to "advance ICANN's core values of openness and transparency:"

• Establish an Ombudsman's Office;
• Define and hire a "manager of public participation" staff role, responsible for developing mechanisms to ensure full public participation in ICANN and facilitate the receipt and analysis of public comment, along with other public relations activities;
• Expand the scope of ICANN's Reconsideration Process to include actions by staff in contradiction of established guidelines and erroneous or misinformed actions of the board; and
• Continue the 2/3rds supermajority requirement to amend the ICANN Bylaws, and establish an arbitration procedure to deal with claims that the board has acted in contradiction to the bylaws.

Government Participation

The ERC recommended that the GAC should be given the power to appoint a non-voting liaison to the board, each of the SOs, and the other ACs in the proposed reformed structure, and also to appoint one delegate to the NomCom. A GAC contact person for IANA function issues was also proposed, and the GAC's input was also requested in relation to the development of a framework of accountability between ICANN and individual ccTLD managers that reflected the CNSO's global and cultural diversity.

Funding

The ERC proposed a per-name fee from registrars and registries "adequate to meet the needs of ICANN as reformed, including the building of adequate reserves."

Public Comment and Board Action at ICANN 13

At ICANN 13 in Bucharest, the public forum provided an opportunity for feedback on the Blueprint for Reform. The comments provided were extensive and addressed all areas of the Blueprint. At the board meeting in Bucharest, the board discussed a proposed set of resolutions regarding the Blueprint and made some amendments and changes based on public comments and board member feedback. Noting that "it is now time to move forward with implementation with confidence that while the Blueprint may not satisfy everyone, it provides the right foundation on which ICANN can build for the future," the board passed the following resolutions:

• the board adopted and endorsed the Blueprint for Reform;
• the ERC was instructed to engage in further implementation and transition work based on the blueprint and with the input of the ICANN community, and propose implementation recommendations in time for public and board deliberation and action at ICANN 14 in Shanghai;
• the ICANN President was instructed to provide all necessary assistance to the ERC;
• the board took note of several issues raised by the community and instructed the ERC to "take due account of these issues as it moves forward in the implementation process, namely, the need to:
  • devise and incorporate specific measures to ensure, to the extent feasible, geographic and cultural diversity in all parts of the ICANN structure, which have been key core values of ICANN since its inception, and remain so today, as expressed in the ERC Blueprint for Reform;
  • consider the creation of an At Large Advisory Committee as a potential vehicle for informed participation in ICANN by the broad user community;
  • ensure that the composition and operation of the Nominating Committee in fact represents a balance among all segments of the Internet community;
  • collaborate with critical infrastructure providers and the technical community to further the establishment of effective working relationships; and
  • ensure that ICANN's policy development processes enhance and promote a transparent bottom-up process;"
• any additional opportunities to strengthen ICANN's capacity to fulfill its mission that were discovered during implementation planning or action should be considered and utilized as appropriate; and
• the board thanked the ICANN community for its thoughtful and engaged dialogue regarding the evolution and reform of ICANN, as well as the volunteers who had committed time and effort to the process to date.

Implementation

The board resolutions from ICANN 13 launched another fast-paced round of work for the ERC. In the time between ICANN 13 and ICANN 14 in Shanghai, multiple status reports, interim proposals, and a substantial redraft of ICANN's bylaws were developed and published by the committee:

ERC Output pre-ICANN 14

Date	Title	Notable Developments	Full Text
July 15, 2002	Status Report on Implementation of Evolution and Reform	Names Policy Development Process and Accountability Assistance Groups formed	HTML
July 24, 2002	Second Status Report on Implementation of Evolution and Reform	At-large Advisory Committee Assistance Group formed	HTML
August 1, 2002	First Interim Implementation Report		HTML
September 2, 2002	Second Interim Implementation Report	Draft Statement of Mission and Core Values; Proposed NomCom Process Timetable	HTML
September 16, 2002	Update Regarding RIR Submissions	Addressing a joint statement from the three RIRs to the ERC listserv stating that they could not support the reforms to the ASO.	HTML
September 17, 2002	Third Interim Implementation Report	Formation of ccNSO Assistance Group	HTML
October 2, 2002	Final Implementation Report	Proposed Bylaws (first draft)	HTML
October 11, 2002	First Supplemental Implementation Report		HTML
October 23, 2002	Second Supplemental Implementation Report	Revised Proposed Bylaws (redline from first draft)	HTML

Public comment was left open during the process to allow responses to flow alongside the output of the ERC.

Board Actions at ICANN 14

At ICANN 14 in Shanghai, the public forum again included substantial time for public input and comment regarding the implementation report. The submission of comments was extensive and ran over the allocated time. It was noted by the chair that action to dramatically amend the proposed bylaws prior to the board meeting the following day was likely impossible. Many commenters expressed gratitude and hope that the remaining issues in contest could be resolved and that the reform process could "get over the line." Others continued to object to specific aspects of the proposed implementation plan, the bylaw amendments, and other aspects of the reform process that might be construed as "mission creep."

On October 31, the board again discussed a set of proposed resolutions, as well as recommended changes to the revised bylaws circulated by the ERC on October 23. The board deliberated on these updates and edits, as well as the proposed resolutions before the board. After this discussion and approval of amendments, the board passed two resolutions related to Evolution & Reform:

• the board adopted the amended bylaws as presented by the ERC and modified within the meeting; and
• the term and membership of the Evolution and Reform Committee was continued until the "Transition Article" (an article of the bylaws designed to "govern the transition to the structure, policies, procedures contemplated in the proposed new bylaws") was adopted by the board.

Board Actions at ICANN 15

The ERC published its Third Supplemental Implementation Report, including a draft Transition Article, on November 24, 2002, and then issued corrections to both the proposed bylaws and the Transition Article in its Fourth Supplemental Implementation Report on December 8 in advance of ICANN 15 in Amsterdam.

At its board meeting at ICANN 15, the board took the following actions:

• the board adopted the proposed amendments to the bylaws submitted by the ERC;
• the board approved and adopted the Transition Article with a minor amendment allowing At-large board members to signal their interest in participating on the Transition Board;
• the ERC's operation was continued until such time that reported that its work was completed, or until the end of 2003; and
• the board approved a budget of $325,000 for the ICANN President to use in hiring up to nine staff positions, as well as to fund travel and other expenditures, to support the transition.

Ongoing Work: 2003

In April 2003, the ERC submitted its Fifth Supplemental Implementation Report, which proposed the creation of the ccNSO. The report presented both structural considerations and proposed text for the bylaws to effectuate the creation of the new supporting organization. In June 2003, in advance of ICANN 17 in Montreal, the ERC posted a summary of proposed changes to the bylaws, as well as additional contextual information, in order to brief the board and community on the changes.

At its regular meeting in Montreal on June 26, the board approved the amended bylaws and created a "launching group" to assist in the creation and launch of the ccNSO.

At ICANN 14, the ERC noted that there were two outstanding projects - the development of the Transition Article and the ongoing work of developing the ccSNO structure and procedures. With the completion of the ccNSO project, the work of the ERC was complete. No final report was issued by the ERC to that effect. It is presumed that the committee was dissolved either informally at a board meeting, or at the end of 2003 by operation of board resolution 02.148.