What was the ICA thinking?

The Internet Commerce Association (ICA) has just altered its membership structure and the way that board members can be elected. I must admit that I applaud the efforts of the incumbent board in trying to juggle the various stakeholders but let’s try and unpack what they’ve actually changed.

There are four classes of membership:
Platinum - $25K/year and an automatic board seat.
Gold - $10 to 24,999/year
Silver - $5,000 to $9,999/year
Bronze - $1,000 to $4,999/year

What’s interesting is the way in which new board seats are awarded. For every $25,000 in revenue a new board seat is created and the gold silver and bronze class members can nominate a member or non-member to the position. There is an election where Gold members have 5 votes, silver members 3 votes and bronze members 1 vote.

From what I see of this structure is that it rewards those with the cash. If you have money then you can effectively buy a board seat at the platinum level. This works well for a commercial organisation that has profit as the motivation but I do not believe that it is healthy for a non-profit association.

In an association the motivation needs to be for the common good of the industry. When it can be seen that members can buy seats then it can be construed by the wider domain community that the association can essentially be “out for hire”. If EVERY seat is up for election then this issue can never arise.

By tying the number of board seats to the revenue line of the association means that as the association becomes successful then it will either have a HUGE board or the $25K hurdle is increased. This will effectively enshrine the “board seat for money” ethos. What I believe it actually means is that the ICA is planning, at its core, to remain a small association. I don’t really understand why you would do this.

Just think about this. Let’s imagine that the association grows and the revenue line becomes $500K/year. This means there will be 20 board seats which in my opinion is way too large. Even Jesus had 12 disciples and one of those didn’t work out too well!

The converse to the situation is if the ICA contracts during the hard times does this mean that the board shrinks in size? This is crazy! This is the time when the board needs to become highly active to ensure that the existing and new members appreciate the value proposition. So just when the association needs the board it slashes the number of positions to reinforce the downward spiral. Why would any association do this????

Now let’s look at the voting structure. The first thought that I have is when a new board member is voted to the board who do they represent? The current structure doesn’t have a representative side to the voting system….it’s all money based. Wouldn’t it be good to have the monetisation, sales, development etc. constituencies rather than just platinum to bronze? Elected board members would then know whom they were elected to represent.

It doesn’t take too long to work out that I can get 10 votes for $10K at a bronze level 6 votes for $10K at silver and 5 votes for $10K at a gold level. How does this make sense? It doesn’t. As soon as you tie money back to number of votes then you no longer have a truly representative association.

What would have been better would be to have 3 board seats plus the CEO for all four classes. This would provide 12 board seats. Each class can vote for the nomination in THEIR class with ONE vote per member. As the association grows then the board seats will become more precious and even prestigious.

Since there are less members in the Platinum class then they are more likely to get voted onto the board. The competition would potentially be fierce at the Bronze level but they can still be nominated and still be elected to the seats allocated to their class.

This is democratic, representative and fair. It detangles the money from the number of votes and resolves the tying of the revenue line of the association to the number of board positions.

So what has really changed with the ICA announcement? I’m not really sure. There was nothing about vision, values or issues that are currently being tackled on behalf of the industry.

Unless I'm not clearly understanding the ICA boards decision, I don’t think that they have really thought about implications of what they have proposed. By putting this out in the public domain as a decision versus a discussion document the ICA board is now committed to a direction that in my opinion will not inspire the industry to get behind them.

As always, I’d be more than happy to discuss any of this with any ICA director.