The Domain Name Commission Limited (DNCL) has been established as a not-for-profit company by its sole shareholder, the Internet Society of New Zealand (InternetNZ). The key objective for the company is the effective stewardship of the .nz domain name space.

Background

The Internet Society of New Zealand (InternetNZ) is an incorporated society established to foster co-ordinated and co-operative development of the Internet in New Zealand. The Society works to safeguard the Internet’s philosophy of open and uncensored exchange of information.

InternetNZ is responsible for the management of New Zealand (.nz) domain name space. InternetNZ has established a not-for-profit company, DNCL, to generally discharge the Society’s responsibilities in the effective stewardship of the .nz domain name space, and in particular:

• the general operation of the .nz domain name space and the contracts that underpin it;
• the authorisation of registrars;
• the development and implementation of .nz policies; and
• international issues and developments as they affect the .nz domain name space.

These responsibilities were undertaken previously by a committee of InternetNZ, the .nz Oversight Committee. A structural review of the Internet Society undertaken in 2006/07 recommended the incorporation of a not-for-profit company under the Companies Act 1993 to manage these responsibilities.

Appointment of the Board of Directors

The Board of the Domain Name Commission Limited is appointed by the shareholder, InternetNZ.

The Board will consist of five directors (with provision for the appointment of a sixth director if required, as a transitional arrangement to ensure continuity as the Domain Name Commission is established as a company).

One (and only one) of the directors will be an InternetNZ Council member, who has been appointed specifically by the Council to the Board. The other directors will be independent people, appointed for their skills and experience, and their ability to contribute as a director at a governance level.

The director who is also a council member of InternetNZ is not there as a “representative” of InternetNZ. This director is expected to provide a connection with and convey the views and position of InternetNZ, but is required to act in the best interests of the Domain Name Commission Limited itself (while recognising the provision in the constitution in the event of a conflict of interest).

The Council also designates the director who is Chair of the Board. This person cannot be the InternetNZ Council member on the Board.

Term of Appointment

All directors are appointed for a term of three years, with a maximum of three three-year consecutive terms.

Where the InternetNZ Council member appointed to the Board finishes his/her term on the Council, the Council may agree to that person completing their current three-year term as a director. This is a matter that the Council should take a decision on, on the advice of its Nominations Committee, rather than allowing the term to continue as though the director continued as a member of Council.

The Chair is appointed for a three year period (renewable) and that for the purposes of succession planning, the normal term limit would, if necessary, be extended so that a Chair would not be prevented solely by the term limit (i.e. three three-year terms) from serving two full three-year periods from the time he/she was first appointed as Chair.

Domain Name Commission Limited

Board Role Description

Key Statement

The Board’s job on behalf of InternetNZ is to ensure that the DNCL achieves its purpose and strategic goals.

Role

The role of the Board is to provide quality governance and leadership of DNCL. This will require the Board to:

• develop and monitor policies which provide direction and boundaries for both its own and the Domain Name Commissioner’s functions; and
• assure itself of the Domain Name Commissioner’s performance against these policies.

Key Activities

The key activities of the Domain Name Commission Ltd in respect of their stewardship of .nz include:

o developing a strategic view of .nz

o establishing the priorities for and supervising the Domain Name Commissioner

o regularly reviewing the robustness of the registrar market and the level of competition between registrars

o establishing standards for performance monitoring of the Domain Name Commissioner, and the registry

o setting a budget for .nz domain name space oversight activities and making a joint recommendation with NZDNR Ltd to the InternetNZ Council regarding the level of registry fees following an annual review

o approving operational policy changes relating to the .nz domain name space

o publishing information on the .nz domain name space

o approving the risk management strategy for management of the .nz domain name space (includes disaster recovery planning etc), and

o other responsibilities as delegated by the InternetNZ Council

Board Functions

1. Maintaining a future focus – providing leadership and a sense of direction for the company.

Specific tasks for the board include –

o Employing, mentoring and coaching the Domain Name Commissioner;

o Setting the vision, mission and values for the company;

o Agreeing strategy, business plans and budgets;

o Ensuring adequate resources and management delegations to enable achievement of the company’s objectives.

2. Ensuring effective issues management and communication.

Specific tasks for the board include –

o Regularly communicating strategy and performance with the shareholder and key stakeholders;

o Identifying and managing risks in order to prevent business and system failures.

3. Compliance and risk management.

Specific tasks for the board include –

o Ensuring conformance with legislative and regulatory requirements and best practice;

o Ensuring adequate processes for identifying, assessing and mitigating risks to the company, its systems and processes, and company personnel;

o Ensuring adequate internal controls and processes are in place to protect the company’s assets (physical, financial, human and intellectual capital).

4. Monitoring company performance.

Specific tasks for the board include –

o Ensuring accurate, timely and relevant management reporting, to enable effective monitoring of KPI’s and financial aspects of company activities;

o Monitoring management’s progress towards meeting agreed business plan and budget objectives;

o Monitoring and evaluating the Domain Name Commissioner.

5. Ensuring effective Board performance.

Specific tasks for the board include –

o Annually reviewing the functions and performance of the Board and its directors, and any Board Committees;

o Ensuring (in consultation with the shareholder) appropriate Board composition, experience and skills.

Linkage to Owner

The Board acts in a fiduciary capacity for InternetNZ and will demonstrate this by:

• acting in accordance with the delegations from InternetNZ
• ensuring that the company’s strategy and business plan reflects the expectations of the shareholder as set out in the annual Statement of Expectations received from InternetNZ
• reporting appropriately to InternetNZ
• gathering information from the InternetNZ about their concerns and wishes
• remaining up-to-date in matters concerning InternetNZ’s interests.

Approach and Process

The Board will govern with an emphasis on:

• outward vision rather than inward focus
• leadership rather than administrative detail
• collective rather than individual decisions
• future focus
• a clear distinction between the roles of the Board and the Domain Name Commissioner reporting to it
• a formally adopted set of Governance Principles.

The Board will govern through:

• cultivating a sense of group responsibility based on achieving a high level of governance excellence
• committing to excellence in all matters coming before it including the adoption of a code of ethics and proper practice (see below)
• formally inducting and training new directors on their role
• carrying out regular self-reviews of its performance against these policies.

Code of Ethics and Proper Practice

The Board is committed to ethical conduct in all areas of its responsibilities and authority.

This means that directors as individuals will:

o act honestly and in good faith at all times in the best interests of Domain Name Commission Limited and its shareholder (InternetNZ)

o carry out their duties and responsibilities in a lawful and business-like manner, and ensure that Domain Name Commission Limited carries out is business likewise

o avoid conflicts of interest in as far as this is possible, and where such conflicts arise, will act within the Board’s Conflicts of Interest policy set out below

o attend Board meetings and devote sufficient time to preparation for Board meetings to allow for full and appropriate participation in the Board’s decision making

o observe the confidentiality of non-public information acquired by them in their role as directors, and not disclose information that might undermine the role of the Domain Name Commission Limited

o interact with the Board and staff in a positive and constructive manner

o be loyal to the collective nature of the Board, abiding by Board decisions once reached

o not do anything that in any way denigrates the Domain Name Commission Limited or harms its image.

Directors as a whole will:

• monitor the performance of management and the Domain Name Commission Limited, ensuring that appropriate monitoring and reporting systems are in place and utilised to provide accurate and timely information to the Board
• ensure there is an appropriate separation of duties and responsibilities between itself and the Domain Name Commissioner, and that no-one has unfettered powers of decision making
• ensure that the independent views of directors are given due consideration and weight in arriving at decisions
• ensure that the shareholder (InternetNZ) is provided with an accurate and balanced view of the Domain Name Commission Limited’s performance including oversight of the operation of the .nz domain name space and financial performance

• regularly review its own performance as the basis for its own development and quality assurance
• carry outs its meetings in such a manner as to ensure fair and full participation of all directors
• ensure that the Domain Name Commission Limited’s assets are protected through a suitable risk management strategy
• adherence to any Governance Principles adopted by the Board.

The Constitution of the company will require the directors of DNCL to put the interest of the shareholder (i.e. the Society) above the interest of the company, should there be a conflict (as it does for NZDNR Ltd).

Conflict of Interest

The Board places importance on making clear any existing or potential conflicts of interest for its directors. Directors should not have a conflict of interest through their participation in the .nz market as a registrar entity or reseller or such association that could give rise to challenges of conflicts of interest.

Accordingly,

• Any business or personal matter which is, or could be, a conflict of interest involving the individual and his/role and relationship with the Domain Name Commission Limited, must be declared and registered in the Conflicts of Interest Register
• The Register will be presented to the Board and formally received at each meeting
• Where a conflict of interest is identified and/or registered, the director concerned shall not vote on that issue and may only with unanimous agreement participate in any Board discussion on that topic
• The Chair must take whatever steps are necessary to ensure that any conflict is managed in an appropriate manner according to this policy
• Individual directors, aware of a real or potential conflict of interest of another director, have a responsibility to bring this to the notice of the Board.

Examples of such conflicts of interest are:

• When a director, or his/her immediate family or business interests, stands to gain financially from any business dealings, programmes or services of the Domain Name Commission Limited
• When a director him or herself offers a professional service to Domain Name Commission Limited
• When a director stands to gain personally or professionally from any insider knowledge if that knowledge is used to his or her personal or professional advantage
• Where a director is on another body that may have competing or conflicting interests or where knowledge of the Domain Name Commission Limited views or information might unduly favour the director’s other appointment/organisation.

Domain Name Commission Limited

Director Role Description

This document should be read in conjunction with the Domain Name Commission Ltd Board Role Description.

The director must contribute, as part of the team of directors who constitute the Board, in an effective manner to the Board undertaking its functions. This includes full participation in all the relevant governance activities of the Board.

Generic Director Skills

The following generic director skills are sought -

o Common sense, wisdom and judgement;

o Integrity and commitment to ethical behaviour;

o Business acumen (including financial literacy) and a track record in his / her field;

o Independent thought and the ability to debate and defend viewpoints;

o Objectivity and the ability to take a broader perspective – the “helicopter view”;

o Ability to work as part of a team and support the collective view of the Board;

o Appreciation of the legal roles and responsibilities of a director;

o Time to commit to the role;

o Appreciation and empathy with the objectives and vision of the shareholder and other key stakeholders;

o Interest and enthusiasm for the issues facing the .nz domain name space and the oversight of a competitive market for registrars.

In addition, directors should be able to consider issues from one or more of the following perspectives:

o consumer/registrant

o technical

o an understanding of the international domain name environment

o regulatory oversight.

All directors are required to be a member of the Internet Society of New Zealand and to maintain this membership during their tenure as a director.

Domain Name Commission Limited

Chair Role Description

This document should be read in conjunction with the Domain Name Commission Limited Director Role Description.

The Chair has the lead role for assuring the integrity of the Board’s governance process and represents the Board to outside parties, and in so doing relies on the active support and participation of the other four directors of the Board.

Success in this position will mean that: the Board behaves consistently within its own rules and the constitution; meeting and discussion content will be only those issues which, according to Board policy, clearly belong to the Board, not the Domain Name Commissioner, to decide; and deliberation will be fair, open, and thorough as well as timely, orderly, and to the point.

Specifically, the Chair is responsible for:

o the efficient functioning of the board and setting the agenda for board meetings

o ensuring that all directors are enabled and encouraged to play their full part in the activities of the board and have adequate opportunities to express their views

o ensuring that all directors receive sufficient and timely information to enable them to be effective board members

In addition, the Chair will attend a quarterly forum with the President and Vice-President of InternetNZ and the Chairs of the other business units of InternetNZ, to discuss areas of common interest, to avoid duplication and to ensure that the activities of the Domain Name Commission Limited are aligned with both the strategic direction of InternetNZ and the activities of the other business units.

The authority of the Chair consists in making decisions that fall within Board policies except where the Board specifically delegates otherwise. The Chair is authorised to:

o use any reasonable interpretation of the provisions in these policies

o chair Board meetings, with all the commonly accepted power of that position

o work closely with the Domain Name Commissioner without cutting across Domain Name Commissioner’s prerogatives and responsibilities as set out in the Domain Name Commissioner’s Role Description and Delegations Statement

o call on individual directors to address and take responsibility for specific issues or serve on sub-committees

o co-ordinate the annual self-review by the Board of its performance against the governance policy

o represent the Board to outside parties and the shareholder

o delegate this authority to another director (while remaining accountable for its use).

In addition to the skills and attributes outlined in the Director Role Description, the Chair should have previous experience in chairing a governance body.