Nominet Gives Ground In Face of Member Insurrection

Nominet has given some ground in light of a number of members, currently around 17.4% of members, proposing to dismiss half the board including the entire senior executive team and a number of other changes. As part of its efforts to appease the insurrectors, Nominet is proposing to scale up its public benefit programme, freeze .uk prices for at least two years and freeze board-level pay through the end of 2022, among other proposals.

According to reports in London’s Sunday Telegraph, there is a campaign led by hosting and technology company Krystal, publicbenefit.uk, demanding changes at the .uk domain name registry that now has the support of almost one in 6 members. According to the Public Benefit campaign they now have 279 members supporting the campaign and “only 9 Top 50 UK members currently undecided.” As of 30 January the campaign had secured the 5% of voting rights required to call an Extraordinary General Meeting (EGM) with an aim for 10%, which has clearly been surpassed.

The campaign is seeking to “restore Nominet’s original public benefit mandate, which under previous management donated as much as £7 million a year to good causes.” Under the current CEO Russell Haworth “those donations have dropped consistently to below £2 million a year.” There were also concerns about the growth in director’s remuneration which now exceeds £2 million per year.

According to a post on the Krystal website, “in the last five years public benefit donations are down 65%, profit is down nearly 40%, yet the top 3 Directors pay is up 70%. Furthermore, wholesale prices have increased over 50%, generating a large cash surplus when prices should have been coming down.”

The campaign is also critical of Nominet, from 2016 to 2020, having overseen a reduced operating profit of 38% (from £8M to £5M), ignored members’ concerns and input and tried to silence critics, the press and members.

So the Public Benefit campaign sought to have members vote on 2 resolutions at the EGM ‘to remove the current Chair, Remuneration Chair and Executive Directors and replace them with 2 new Directors charged with restoring Nominet to its original character.’

The plan was to install Sir Michael Lyons, BBC Chair from 2007 to 2011, as interim Chair replacing Nominet’s current Chair Mark Wood, in the extraordinary general meeting that had been called, as well as Axel Pawlik, for 20 years the Managing Director of the RIPE NCC, as interim vice Chair.

In their response Monday, Nominet through their Chair Mark Wood say they “have unequivocal advice that the second resolution, seeking to designate Sir Michael Lyons and Axel Pawlik as Directors is invalid and cannot be put before members … because Members may appoint directors only through the elections process specified by our constitution, articles and bylaws, and the maximum number of member-elected Board seats are already filled.”

Wood goes on to say Nominet is “even more concerned about the potential impact of the proposal to remove five appointed directors, including the entire executive team plus two appointed directors, including the Chair. Doing so would have a critical destabilising impact, leaving the company leaderless and facing a potential exodus of the highly-skilled staff we depend on to maintain the complex registry service we provide.”

Wood concludes “the Board is unanimous in its view that Simon’s proposed resolution should be rejected.”

Additionally, on 9 May Wood wrote to Members saying Nominet would be:

  • scaling up their Public Benefit work “and will have committed £4 million by June, double the amount of last year. In future years we will devote 10% of revenues to public benefit initiatives, putting Nominet at the forefront of UK businesses committed to purpose and good causes”
  • freeze .uk registry fees until the end of 2022
  • freeze board remuneration until the end of 2022
  • invest £20 million over the next three years in next generation registry infrastructure, drawing on reserves for the funding
  • launching a Registry Advisory Council (RAC), a new body with members elected directly by different sectors of the membership with a remit that will include a key role in price setting and policy making
  • launching a new Member Hub to improve membership engagement, giving members access to useful statistics and information, seeking to undo the damage done in closing the Nominet Forum
  • increase financial transparency.

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