Concerns about the removal of critical talent by DAO voters
You make a valid point. Under my proposed concept, the Directors that value their job more than the Executive Director would remove the Executive Director. Alternatively, they would sacrifice their roles for the greater good protecting the Executive Director until the DAO could appoint Directors that would remove the Executive Director. The hope would be that Directors would act in the interest of the project. The chaos caused by the latter scenario may be considered an extra protection mechanism as the chaos caused by the removal of the majority of the Directors increases the cost of the attack. The following proposals should lead to increased engagement from other DAO voters, giving the disengaged community time to react.
Simple additions to solve this case
In light of this response, I would consider a similar model with minor checks, such as proper performance evaluation with evaluation periods and protections against arbitrary dismissal by Directors. The Civil Reform Act of 1978 may provide a blueprint for this:
A similar model would balance the needs of the employees of the Foundation and provide for effective oversight and performance evaluation by the Directors. The key would be right-sizing this for where the Foundation is today. While there will be concerns about administering something like this we only get one bite at this apple and it is worth doing right from the get-go using an MVP-like implementation of the idea.
Transparency & Funding
I urge the Foundation Directors to release a historical record of expenditures and a current balance sheet before any changes. It is difficult for voters to make decisions about such structural change without specifics. Other than the loose definition of assets provided, there is very little to go off. Only the proposers of PIP-26 know the actual numbers.
Worst case, adding the requirement to be transparent before the proposal goes to a vote is a good forcing function for the Foundation to reconcile its accounts and present the first transparency report.
It would be wise to present a plan created by the to-be Directors to address the long-term viability of the Foundation. One year of runway is not an overwhelmingly inspiring number for an entity designed to steward the ecosystem for decades.
We can debate the role and the timeline of the new Foundation, but the reality is that the Foundation will need to be fully funded for multiple years. Continued funding should be a key issue that DAO voters should think about as we go to a vote.
We should expect an in-depth execution and financial plan before taking this to a vote.
The incentives in this proposal put all compensation in the hands of Directors, i.e. remuneration (token grants) are decided by Directors for the Directors out of the Foundation Treasury.
Further, this proposal would eliminate the $50,000 salary cap - the only proactive check provided to prevent overly generous remuneration (edited for clarity). Possibly more concerning, the Directors could set terms for grants that the DAO cannot control. Theoretically, Directors could decide that they all deserve 2M POKT guaranteed no matter the level of contribution or the status of their service to the Foundation.
This proposal seems to go against the established precedent for compensation. In this case, remuneration is determined before the work is performed. This practice goes against the precedent set by the authors for remuneration after work is performed as demonstrated by PEP-35:
While the nature of the proposal is different the idea is the same: the compensation for work should be determined after the value of the work can be assessed. This standard should be applied in this case as it is much easier to assess the success of the Foundation leadership after their work product is delivered - not before.
If we go down this path of compensation before the work is performed we create a clear delineation for contributors to Pocket Network: insiders and outsiders. Insiders who are not subject to the DAO’s oversight and outsiders who must create proposals and convince others for compensation for work.
If we are to go against the established precedent of retroactive compensation in favor of prospective compensation, I propose an alternative solution. To ensure transparency and fairness the Directors should be required to ask for a token grant from the DAO. The ask would come in the form of a proposal that would delineate the amount and specific terms of the grant.
I would take this a step further and disallow Foundation Treasury funds to be spent on Directors and employees/contractors to avoid this issue. Any employee grant pool should be established and approved by the DAO and should be administered by the Foundation Directors per the proposal.
Alternatively, we could stick to the precedent and pursue retroactive grant compensation based on the performance of the Directors/Executive Directors, creating a level playing field for all contributors.
I am suggesting these changes to create a level playing field where contributors of all types are being compensated in the same manner and to avoid any appearance of preferential treatment of, or foul play, perceived or actual, by Directors.
I would raise concerns about using this part of the constitution to justify its control over the remaining Treasury Foundation:
The line provided above from the Pocket Constitution clearly outlines that the DAO allocates funds via PEPs and that the Foundation intended to allocate those funds per the PEP. It makes no mention of the Foundation Treasury or the allocation of that in that quote.
Further, I do not believe there is a reference to the Foundation Treasury in the constitution. With this stated, we must rely on what is in the constitution to understand the role of the Foundation. It would appear that the proposed discretion is unconstitutional:
As the Foundation Treasury decision does not qualify as a Material Adverse Exception Events (MAEEs), I would be curious how to justify the Foundation Treasury discretionary spending. The proposal as it stands could be in jeopardy of being unconstitutional.
The challenge then is how to interpret the ambiguity, which is addressed in the Constitution:
The question raised above by @JackALaing and @zaatar should be resolved. The resolution could come from an understanding of which document takes precedence. I would argue that the Constitution is the end-all-be all governing document in the Pocket Network ecosystem, despite how flawed it may be. Rather than dismissing it as antiquated we should seek to fix it through amendments.
My understanding of the Foundation Treasury is that it enabled a legal wrapper for the DAO. It could be used to sell tokens that would fund DAO initiatives. The DAO, possessing no means of storing stables nor executing real-world agreements, would be reliant on the Foundation to execute. Logic would follow that it makes sense to have both a DAO and Foundation Treasury that provide funding for different cases (fiat and POKT). In a scenario where there is no Foundation, the DAO would have no mechanism to convert POKT to fiat and pay employees/contractors for services.
Operationalizing the Foundation Treasury
I would suggest that some discretion could be built into the system, but with proper checks and balances. At a minimum, the DAO should have adequate boundaries for Foundation Treasury spending (e.g. a budget) that provides some oversight for DAO voters. A budget would be a way to operationalize the intent of the proposal. There would need to be an update to the Pocket Constitution to make this work - as it stands, the Directors appear to be unable to use any discretion.
There are issues with the proposal as it stands that should be resolved before contemplating a vote:
1.The DAO should expect to receive some sort of detailed balance sheet to understand what we can reasonably expect out of the Foundation.
2. I would urge the would-be Foundation directors to release an in-depth execution and financial plan before taking this to a vote.
3. Lack of oversight on remuneration. Directors should have reasonable oversight and restrictions on token grants.
4. Potential constitutional questions around Foundation autonomy and the Foundation Treasury
To be clear about my position, I believe in the essence of what is being suggested, but I believe some of the details are rushed. I believe the Foundation should be separated from PNI in all haste, it should be given reasonable control over a budget so that it can play this role, and the Constitution should be updated to clarify its role in the ecosystem.
I want to avoid a situation where we rush through this process for the sake of expediency without putting the proper structure in place to see it through. I understand that this will be an ongoing and evolving process, but we risk tainting this administration if we rush through this process.