# PIP-26: Foundation for the Future **URL:** \ **Category:** Improvements\ **Created:** [November 16, 2022, 7:31pm UTC](https://forum.pokt.network/t/pip-26-foundation-for-the-future/3657 "2022-11-16T19:31:12Z")\ **Posts on this page:** 1\ **Showing post:** 12
**Author:** ![Dermot](https://forum.pokt.network/user_avatar/forum.pokt.network/dermot/32/1382_2.png) [@Dermot](https://forum.pokt.network/u/Dermot)\ **Post date:** [December 5, 2022, 12:57pm UTC](https://forum.pokt.network/t/pip-26-foundation-for-the-future/3657/12 "2022-12-05T12:57:47Z")
Hi @zaatar - jumping in here, although Nelson and Jack may wish to supplement my answers / give their own take: > [@zaatar](#): > > Can you provide info on PNF’s new operating systems? Neither me or Jack have been appointed to PNF yet, so this item is a first-order priority once onboarded. We shared our initial thinking on the problems we see with the DAO and how PNF can help solve some of these coordination problems in our presentation in Tampa . See slides 102-112 [here](https://21349012.fs1.hubspotusercontent-na1.net/hubfs/21349012/pdf/POKT-SOTU-2022-final.pdf) And Jack also summarised the planned approach in his OP. To answer you directly though, PNF’s operating systems ultimately refer to how we plan to embed PNF’s values and operating principles into its working practices; how we communicate, how we facilitate feedback, how we listen, how we act transparently, how we collaborate, and so on. One fundamental way the community can keep PNF accountable is by referencing PNF’s public roadmap and KPIs. We want to ensure this is a two-way process, as PNF aims to partner with community stakeholders, not act as the parent. And to amplify the impact that all stakeholders in the ecosystem can make. > [@zaatar](#): > > What update(s) does this refer to? Updating the DAO constitution refers to the updates in Jack’s OP, ie: > [@JackALaing](#): > > These amendments amount to unblocking standard compensation for Foundation directors and contractors… > > - Empower the directors to make remuneration decisions without DAO approval > - For accountability on the above, require the directors to publish quarterly remuneration figures > - Allow directors/officers to receive POKT token grants as part of their remuneration > - Remove the cap on director/officer remuneration (previously $50k/annum) > > …and preserving the operational continuity of the Foundation > > - Empower the directors to fill director vacancies temporarily until the DAO chooses a permanent replacement > - Increase the approval threshold for changes to the legal structure of the Foundation to require a two-thirds supermajority > [@zaatar](#): > > What improvements are being considered? Will these be put to a DAO vote? This was covered in the SOTU update in Tampa, and relates to some ideas on removing more friction from the proposal process while also increasing contributor accountability. See slides 102-112 [here](https://21349012.fs1.hubspotusercontent-na1.net/hubfs/21349012/pdf/POKT-SOTU-2022-final.pdf) All changes that affect the proposal process will be subject to a DAO vote. See the following screenshots from the presentation by way of example: ![Screenshot 2022-12-05 at 12.41.29](https://forum.pokt.network/uploads/default/original/2X/c/c14a2fa26e1dee7162f2334f768788b328350708.jpeg) ![Screenshot 2022-12-05 at 12.39.50](https://forum.pokt.network/uploads/default/original/2X/9/91680bd9601409dae3b881d60cd171ea47474577.jpeg) ![Screenshot 2022-12-05 at 12.41.44](https://forum.pokt.network/uploads/default/original/2X/4/438309a2b5eece7230c3ef244cf06b462ccdb8f6.jpeg) ![Screenshot 2022-12-05 at 12.39.59](https://forum.pokt.network/uploads/default/original/2X/0/0cc654c16d6a49fd0e737f1ddffd5f852e65ed5f.jpeg) > [@zaatar](#): > > Will the DAO vote on whether to adopt this socialware? Socialware refers to mechanisms that create assurances through human relationships, eg cultural practices and processes like AMAs, debates, as well as recommendations on how we communicate and give feedback to each other. Well-developed mission, vision, values, and practices on transparency would fall into this bucket. It’s basically the social layer of the DAO. And we want to work hard to improve that. As I think we all agree that it could be a lot better. Socialware is opt-in, and could be as simple as a new channel in discord, or some simple recommendations on what we - on behalf of the community - believe to be best practice. Or even simply a new website that collates certain key community resources. As a result, most new social ware initiatives will not be subject to a DAO vote. On the other hand, any thing that gives special permissions to any particular group, or has additional funding implications from the DAO - such as a proposal like GRIP - will require DAO approval. > [@zaatar](#): > > What is the role of the “Secretary”? The proposal does not say. And who will be the Secretary? The Secretary is [Silverside Management](https://silversidemanagement.ky/) , the Cayman Islands organisation paid to carry out company secretarial functions for PNF, such as filings etc The Secretary is referred to in PNF’s articles, which are stored publicly on Github - see [here](https://github.com/pokt-foundation/governance/blob/12949c5060638591accd2ba07f07626426723c26/foundation/Pocket-Network-Foundation-Articles-of-Association-Highlighted.pdf) > [@zaatar](#): > > Who is meant by “members” of the Foundation? Officers? Others? There are no “members” in the context of PNF as an “ownerless organisation”. If PNF were to change its legal structure to have shareholders or other beneficiaries, it would then have a set of “members”. However, such a change is not envisaged or planned, so you can ignore all references to members > [@zaatar](#): > > What resolutions does this contemplate? And what is a special resolution? (it’s not defined in this PIP.) Jack listed the types of resolutions that require an ordinary/special resolution in his original post, namely: - Director appointments (except where the appointment is temporary to fill a vacancy) - Director removals - Admission of new members (a legal term for Foundation members, of which we have none) - Restricting the subsequent admission of new members - Validating prior/future acts of directors which would otherwise be in breach of their duties - Designating and revoking the designation of beneficiaries - Amending previous Ordinary/Special Resolutions - Fixing a quorum for the transaction of business at a meeting of directors - Releasing directors from liability in connection with the discharge of their duties (except in cases of their own dishonesty) - Transferring the jurisdiction of the Foundation - Winding up the Foundation and determining the distribution of Foundation assets - Changing the Foundation’s name - Changing the provisions of the Foundation’s Memorandum - Altering the Articles of the Foundation The legal definition of ordinary and special resolutions is referred to in the articles linked above > [@zaatar](#): > > What is contemplated here? Do you mean to the DAO? The Foundation is legally based in the Cayman Islands; if it were to change jurisdiction it would require a special resolution. > [@zaatar](#): > > For ease of reference, please provide a link as part of this proposal to the memorandum. Also, please provide a link to the DAO Constitution (mentioned in PNF’s Roadmap for Q4 22). There’s already a link to the Foundation Articles. Sharing these here for posterity: - [SOTU slides (102-112)](https://21349012.fs1.hubspotusercontent-na1.net/hubfs/21349012/pdf/POKT-SOTU-2022-final.pdf) - [DAO constitution](https://github.com/pokt-foundation/governance/blob/12949c5060638591accd2ba07f07626426723c26/constitution/constitution.md) - [Foundation articles](https://github.com/pokt-foundation/governance/blob/12949c5060638591accd2ba07f07626426723c26/foundation/Pocket-Network-Foundation-Articles-of-Association-Highlighted.pdf) > [@zaatar](#): > > How much money (stable coins) are we talking about? We are currently reconciling all finances, including all immediate outgoings, such as paying for the Copper custody arrangements on behalf of the whole ecosystem and putting together a budget for 2023. Once the new Foundation team is appointed, we will get to work quickly on providing more transparency into Foundation financials, including sharing annual accounts and quarterly transparency reports (the latter being enforced by clause 4.42, as introduced by this proposal). > [@zaatar](#): > > Can you give the background to how the foundation was funded? Regarding the DAO Treasury, does it consist wholly of the DAO’s 10 per cent share of POKT node servicer rewards? And I apologize for asking what is probably obvious, but who now controls access to the DAO Treasury and will PEP-26 change that? The foundation received a gensis grant of POKT as per the [token distribution chart](https://docs.pokt.network/learn/economics/faq/) on the website The Foundation has approx 23m POKT in its treasury as of today. POKT was sold to investors as part of previous financing rounds, which has resulted in PNF having some stablecoins on its balance sheet. PNF’s major outgoings over the last couple of years have been funding PNI’s development work on behalf of the ecosystem, payments to Copper (for custody), market makers and exchange listing fees. This proposal does not affect the DAO’s treasury or how the DAO allocates such treasury. As per Jack’s comment in the original post: > [@JackALaing](#): > > _Note: where Foundation spending is referenced, i.e. remuneration, this involves use of the Foundation’s treasury only, not the DAO’s treasury. None of the clauses detailed herein empower the directors to transfer funds from the DAO treasury. Only approved PEPs have the power to action DAO treasury transfers._ > [@zaatar](#): > > You refer to these Articles in the proposal. Is the “Company” PNI? Will these sections need to be amended too – since PNF directors would no longer have any fiduciary duties to PNI? The articles refer to the foundation as the “Company” PNF directors will have no affiliation or duty towards PNI > [@zaatar](#): > > How long are these positions for? “Permanent” implies appointments for life. To build in accountability, should term renewal not be required every few years by a DAO (supermajority?) vote? Similar to most board positions, there is no specific end date for these appointments. For now, the key priority is getting the foundation up and running and delivering value to the ecosystem. We expect the board to expand in the latter half of next year once certain critical operational and strategic items on the roadmap have been delivered. At that point, the hope is that the PNF board can be more focused on governance than operations, and it would likely make sense to have fixed term limits, or to explore other ideas around voting via the DAO, and so on. This will be a collaborative process, and we want to seek community feedback and input throughout. > [@zaatar](#): > > I will reply with another post shortly on my main two concerns. One relates to the proposed definition of supermajority and the other to the weakening of DAO oversight over PNF spending. Looking forward to your further questions and input. However, to respond to your last point, we are delivering more DAO oversight over PNF spending through quarterly transparency reports, which goes much further than any other foundation in the ecosystem. DAO control over appointment/removal of directors is another key aspect of “DAO-based control and transparency”. Ultimately, we expect to be removed if we aren’t doing our job. Furthermore, PNF will need financial support from the DAO in the future to continue its mandate, so it will be a crucial priority for those leading PNF to showcase to the community exactly how we are deserving of current funding and what we plan to do in the future to deserve any more. FWIW, I’m very excited to work on unlocking Pocket’s DAO and its wider community. It’s a mission very close to my heart. And I like to think that we can do a decent job of leading by example and showcasing PNF’s operating philosophy, which we all put a lot of work into defining and aligning around. S/o to @b3n in this regard too! --- _[View the full topic](https://forum.pokt.network/t/pip-26-foundation-for-the-future/3657)._