Home, UK Â Â Â Â Â Â Â Â Â Â Friday, 16 May 2014 Â Â Â Â Â Â Â Â Â Â 7am BST
I need some urgent advice from the community.. am I thinking along the right lines? Please do write your comments here on the blog, or on Facebook/Twitter/LinkedIn/Google+ if you see the posting there. You may, if you wish, contact Nominet about your feedback directly (but please do make sure you copy me in on what you write to them).
Note that you do not have to be a Nominet member to comment on this. You do not even have to have a .uk type domain name to comment here (Nominet are the organisation which allows the registering and maintenance of .uk domain names – such as bbc.co.uk, denesh.co.uk, etc). This posting is about lack of openness and transparency in a company which says it is open and transparent. I’d like to know your thoughts on this. Please read on…
Also note that if you wish to change your vote (or assign a new proxy) after reading (and investigating) this, then you may do so as Popularis (the election scrutineer) do allow this although you will need to do this by early next week. The Nominet AGM takes place on Wednesday 21 May (next week) and if you wish to change your vote or do wish to vote, or raise any concerns with Nominet and/or the election scrutineer, Popularis, then you need to do this ASAP.
If anything I have written concerns you and you wish to complain about the lack of transparency, then I would urge you to email:
- elections@nominet.org.uk
- Nick.Wenban-Smith@Nominet.org.uk (Nominet Senior Legal Counsel)
- help@popularis.org (Election Scrutineer)
Transparency, is important to me. So are fair elections. However it seems that Nominet (via it’s Senior Legal Counsel, Nick Wenban-Smith) do not believe in such… especially when it relates to the current Board election and one of the candidates… and this is where I would like your opinion and thoughts.
It is very hard to stay away from conflicts of interest in this industry. What is important is how we deal with those conflicts of interest. However when one is asked to disclose these, I do believe there should be no omissions. Further, if any such omissions are brought to the attention of the company running the election, I believe they should take appropriate action, regardless of who it relates to (whether a recommended candidate or not).
As a brief explanation, I noticed a glaring and significant omission in one of the candidate ‘Statement of Interests’ (a statement to show the voters where any conflicts do or may arise) – that belonging to Oliver Hope. I reported this to Nominet, yet they continually refuse to do anything about it. What is the significant and glaring omission? The fact that the company Oliver is a Director of and has significant influence in, is a large supplier of services to Nominet.
Further, he signed a declaration, stating:
“I confirm that the contents of all of the documents I have provided to Nominet with regard to the NED election are complete, true and not misleading.”
It must also be noted he mentions nothing of his company’s supplier status to Nominet in the section where he answers Nominet’s questions – he only specifies his company as a domain registrar and claims there would be no conflict:
[Nominet Question] B. The Nominet Board places a high degree of importance on each director being able to exercise independent judgement, free from any conflicts of interest. Please describe how you would be able to fulfil your duties in the light of your involvement in the domain name industry or your other commercial interests.
[Oliver Hope’s answer] I would not be conflicted on the board. I work for a domain name registrar, but I demonstrate independent judgement in all my governance work. As a chartered accountant I remain independent and audited by profession. I believe in the principles of transparency and equality. As a member of the ExCom of the RrSG I must regularly act in the best interests of the overall group, not allowing any conflicts to interrupt the best course of action for the wider membership.
I have a long ongoing email exchange (since the end of April) with Nominet’s Senior Legal Counsel, Nick Wenban-Smith. Nick refuses to see Oliver’s omission as any problem. The reason? He claims the news about Mesh Digital Limited (Domainbox) supplying services to Nominet is public anyway (if you go looking for the announcement made on 1 May last year, that is), and is not required in Oliver’s full disclosure statement.
Could this be because he is, for some reason, one of their recommended candidates? (yes, Nominet recommend candidates to voters rather than rely on an open and fair election). Is he a recommended candidate because they need to keep a representative of the top registrar and a supplier on the Board? Oliver Hope is the Finance and Operations Director at Mesh Digital Limited (wholly owned by Nominet’s largest Registrar in terms of domain name revenue (over £7 million annually) – Host Europe Group (with brands such as 123-Reg, Webfusion, amongst many others).
In my view, Oliver’s statement falls short of the required standard. Nominet are recommending a candidate who has not given a full and complete disclosure (as the candidate is from a member and supplier organisation of Nominet). The statement requirements are there for a reason.. so that voters may, at a glance see all the pertinent information about the candidate and have no need to go looking elsewhere. Oliver certainly mentions he works for Domainbox.. however unless you go searching for the specific information about Domainbox being a supplier, you will not find it. When you do, you will notice one announcement from Nominet on 1 May last year. Even the Domainbox website does not mention the fact.
Nominet refuse to make the fact of Oliver’s major and significant conflict of interest transparent in the elections, while they were adamant in putting a disclaimer on Oscar O’Connor’s election statement even though it was not required. Double standards?
Society in general complains that Government is controlled by big business. In the case of Nominet this is actually proven when taking the weighted voting structure into account. Big business really does control Nominet. Host Europe Group are by far Nominet’s largest registrar and thus gets the most number of votes and thus pretty much controls what happens within .uk.
What does this mean in the current election? Whomever Host Europe Group vote for are pretty much guaranteed to get in.
What does this mean in the long run? Whenever a Board discussion happens and a decision needs to take place, what influence will the largest registrar’s representative on the Board have in the way the discussion and decision is steered? If a resolution goes out to a member vote, then will it really matter how many of the thousands of members vote when the top 10 registrars have the most influence (approximately 70%) overall and the top registrar has the most influence in voting results? An open letter to Nominet’s top members by Emily Taylor explains this:Â
http://www.guard.co.uk/open-letter-nominets-top-members/
I must say that Nominet functions extremely well in running a registry. If you register domains directly with Nominet then you are most likely to have a smooth experience. Everything just works. The staff are polite and knowledgable.
We all want a stable Nominet. We all want Nominet to continue with the excellent service it provides. However we must not get disillusioned in the meantime. Bad governance will affect Nominet operations in the long run. As such we should be pushing for good governance, especially if you wish for Nominet to remain out of Government control.
Even if you are one of the top 20 Registrars within the Nominet universe, are you happy with most of the power growing and being with the top registrar?
Let me give you an example… the results of the direct.uk consultations showed that most of those consulted thought it was a bad idea – how will it actually increase the namespace in it’s current form? – however Nominet still went ahead with the idea. The Nominet Board believed they knew better than the stakeholder community they consulted.
This raised questions in my mind. If the decision to go ahead with direct.uk was already decided then the only point of the consultation was to ask how it should be implemented. Who on the Board was pushing for this? Who had the most to gain? Which of the Board members (associated directly or indirectly with the largest registrars) discussed and steered the discussion and decision and which of them recused themselves from this? Nominet have not been forthcoming with such information. The lack of transparency concerns me.
It is no secret that I am also a candidate in the current Nominet Board election. I would of course like to be voted in as I believe I can drive the necessary changes in Nominet governance to make it an even better company for members and stakeholders in general. That said, this posting was done as I see a major problem in the way Nominet are trying to get a recommended candidate in. It is supposed to be a transparent organisation, upholding good corporate governance practices and running fair elections. That certainly is not evident.
That’s all for now. I hope that you will comment on this with your views. If after reading this, you wish to change your vote, then please do not hesitate. If you wish to email me privately, please do so on denesh-nominet at bhabuta dot me dot uk
The election statements for all candidates are at http://www.nominet.org.uk/sites/default/files/Candidatestatements2014.pdf
I look forward to reading your comments.
Thank you for this helpful post Denesh – I share your concerns for a number of reasons, but my biggest concern is simply the overriding governance here, and particularly the power that seems to have been afforded to Nominet’s own internal legal counsel (Wenban-Smith) as the arbiter between right and wrong.
We picked up exactly this point in the Nominet NED elections last year, and challenged Nominet’s policy to recommend candidates, to employ company resources to canvas for those candidates (5000 telephone calls), the truth behind Nominet’s election materials, the data-mining of databases to determine voting patterns, and most particularly statements prepared by Dickie Armour in his election pack.
Wenban-Smith simply declared himself satisfied with the materials, as though that was enough. Who has given him this power to review himself and complaints against himself and the election committee, and declare any decision he makes about himself as final?
Lucien Taylor – Candidate last year.
Only when you have transparency will you be able to have accountability. And transparency is only valuable when it is in the form where the information is organized such that it is digestible and readily available.
If no one is asked to provide a conflict of interest statement, then there would be little argument here. However, there is a potential for conflict of interest if there exists a direct business relationship between the 2 entities that someone has influence in. Even if the influence is small, or the relationship is minor, the potential exists. But if either is less than insignificant, then the relationship should very much be brought to light in the conflict of interest statement. Even if it is public knowledge posted in an announcement weeks or months ago, the rightful place for that information in an election should be in the conflict of interest statement. Let the voter decide if the person would be able to serve appropriately even with the potential for conflict.
And if the business relationship is seen to be so insignificant to the election, then there is no harm in including it in the conflict of interest statement because the intelligent voter would surely see it as not any problem.
I would finally add that perhaps some leniency can be afforded here if there are adequate opportunities for the candidates to campaign or debate with each other. This would provide a venue for things of this nature to be uncovered. However, if such an opportunity is not available, then that is all the more reason to be thorough in whatever documentation and information that is provider to the voters.
I see some similarities here with some of the complaints I’ve seen at the ICANN level. Many people charged that ICANN was being run by their legal council. But I agree with the “new” ICANN CEO Fadi Chehade when he said that their legal council was doing his job, but the rest of the organizations wasn’t doing there’s.
It is true that the legal department must highlight the risk and explain the consequences of actions that are potentially legally dangerous to the organization. However, the CEO and Board must weigh these risks against other considerations. Yes, the input of the legal department is extremely valuable. However, that department should never have the final say. To allow that to happen is cowardly.
I agree with your thoughtful comments, Louie.
I also see parallels with ICANN, except that I believe that there is now a more rigorous process for declaration of interests within the ICANN environment. I also found the ICANN General Counsel very helpful when – during the WHOIS Review Team process – we asked for advice on management of conflicts.
A good rule of thumb that a long-time ICANN staffer explained to me was “the red face test”. Would you feel embarrassed if someone else brought up a connection, where you had not declared it first?
Like you, I’m not persuaded by the “already in the public domain” argument, because it suggests that (in this case) voters in an election will be sufficiently up to date with the intricacies of business relationships within an organisation. We know that many votes do not engage to that level, and may well have missed potentially relevant information.
This is not to say anything personally against Oliver Hope. I’m sure he’s a person of integrity. Denesh said it – there are lots of conflicts in this small industry, and it may be that something relevant was missed by accident. However, where a complaint is made, there needs to be rigorous and even handed follow-up by the organisation. All candidates should be subject to the same rules.
The playing field is already skewed because of the voting power of a handful of top members. When candidates are not held to the same standards, the integrity of the outcome is at risk.
For me all this shows is why no real change will ever happen. In any type of election when candidates that could be considered “protest†candidates single on an single issue with so much intensity, it leaves voters feeling disillusioned as they don’t know what this “protest†candidates stands for other than moaning and making a nuisance, and as you say Nominet functions extremely well so why vote for someone that might jeopardise this balance simply so they can have their gripes heard on the main stage?
I don’t think it is wrong for things such as this omission to be pointed out, raised, and even questioned, but in the same breath it needs to be seen as simply a noticeable side point while you are making your case for how having you elected would benefit all members and the wider community.
If candidates with brave new ideas on how to make Nominet ‘better’ that did not have the protest stigma attached to them were continually overlooked, then I am sure the noise of the members without the voting power of the Host Europe Group or equivalent would finally get heard and the weighted voting system would be seriously debated.
I think the lack of transparency is obvious and concerning. What glared at me especially was the statement: “I would not be conflicted on the board. I work for a domain name registrar, but I demonstrate independent judgement in all my governance work.”
I don’t think there should even be a distinction between demonstrated conflict of interest and potential conflict of interest. Oliver Hope’s assertion there’s no conflict of interest because he says there isn’t. Nobody should be in a position if there’s even potential – even moreso if the evidence for each of Hope’s positions functioning discreetly is basically just him saying so.
It just seems wrong for Nominet to support this. They’re going to provide ample opportunity for a supplier to sway decisions but of course this would never happen. I’m cynical but I think that would cause fairly trusting people to likewise scratch their heads and say “hmmm.”
Thought you might like to know we’ve written up our views on the topic and linked to this post.
https://krystal.co.uk/blog/2014/05/nominet-an-opaque-oligarchy-in-the-making/
Very interesting.
Does the Government of UK has any power over Nominet ?