[Chapter-delegates] Why can't one be a Trustee and Chapter leader at the same time? (was Re: Message from Internet Society Audit Committee Chair)
Andrew Sullivan
sullivan at isoc.org
Thu Nov 5 09:48:45 PST 2020
Hi,
I will leave the discussion about why the CoI rules for the Board are as they are for the Board, because it is a governance issue. But there is a straightforward tax answer to the question below:
On Thu, Nov 05, 2020 at 01:56:39PM -0300, Flávio Rech Wagner via Chapter-delegates wrote:
>And I am very surprised to know that Chapter leaders should not serve
>as Trustees. This does not make any sense. Chapters elect four
>Trustees exactly to bring their perspectives to the Board, and their
>leaders are the persons that best understand and represent those
>perspectives.
Chapters are, legally speaking, separate organizations from the Internet Society (i.e. the corporation incorporated in the District of Columbia in the US). The US Internal Revenue Service requires that Trustees disclose, in the annual 990s we file with them, any case where they have an interest in another organization that receives money from the Internet Society. In principle, any Chapter can be in receipt of money from ISOC because of the admin fund, because of the money that flows through the Internet Society for Beyond the Net, and because of the Chapterthon. If an officer of a Chapter were to be in a Chapter that receives any of that money, then we would have to report it to the IRS and undergo a bunch of additional investigation and audits and so on (because, as an officer of such a Chapter they have a fiduciary relationship to the Chapter and so are deemed to have an interest). It would be a risk to the organization and our 501(c)(3) status. That is why it is important that nobody in a Chapter leader position be a Trustee at the same time.
That is not to say, of course, that people who have been leaders in a Chapter should be excluded from selection as a Trustee. We often have people who become Trustees while they are Chapter leaders. They simply have to give one up or the other.
I hope that provides the information you need.
Best regards,
A
--
Andrew Sullivan
President & CEO, Internet Society
sullivan at isoc.org
+1 416 731 1261
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