Policy Council Motions and General Discussion

Use this for discussion of motions and other activities related to the Policy Council and governance in general.

The web portal has been updated for submitting reports and motions - log in using you NEW* credentials (the same way you log in here). The 2020 content is archived at https://proceedings.systemdynamics.org/PolicyCouncil/2020

A post was merged into an existing topic: Motion 1021 - Stewardship

The proposal and activity plan for the Stewardship committee is most welcome. It augurs a longer term model for our operational stability and growth.

I do want to encourage the committee to consider slowing its upfront cash expenditures. In the proposed budget, we will have exhausted the approximately $30K in-hand Legacy Fund balance by the end of the 2021. The Stewardship Committee has committed to replacing this seed funding in the second half of 2021 continue that effort during 2022.

If that goal is not reached, we will have to consider funding additional efforts out of operations. Thus, I suggest that less be spent in 2021, and give the Committee has a little more cushion into the first half of next year. Perhaps some of the contractor payments can be contingent on having pledges for cash?
We can review the progress of the effort as part of the regular budget cycle in the Fall.

These thoughts have not been endorsed by the Finance Committee.

Like Eliot, I would like to keep what is on-hand in the Stewardship fund positive. But I am less concerned about constraining the outflow, than speeding the inflow. While the overarching goal of the Stewardship Committee is long term, it also needs to keep things rolling enough in the short term to not become a burden on operations. To me, the easiest way to do that is to bring in a modest portion of the ambitious targets as cash in the near term.

These are also thoughts not endorsed by the Finance Committee.

@Eliot and Bob, thank you very much for your thoughts. Yes, this can certainly be done. What does that mean in terms of the motion itself? Do I modify or withdraw?

@birgit.kopainsky @bob A good question. As the planning is embedded in the policy, I suggest an amendment to the policy with a revised set of goals and timing and the endorsement of the committee. To be consistent with other policies, you could remove the budget section and submit it as a report with a request to release the funds as a separate vote.

In the future, the planning budget comes in the form of a report. Policies are expected to last longer than the operational decisions of a committee,

I’ll coordinate with the proposed committee members as to how to modify the budget. @Eliot_Rich, there are two separate motions. one is the policy and one is the budget amendment. I’ll probably amend the budget one. but the one about policy, in my eyes, stands as is.

@Eliot - I am not completely following your suggestion. Do you mean, that as part of Policy 10A we state something like:

The Stewardship Committee shall not submit a budget and plan of activities that draws the Stewardship Fund below $5,000 at any time.

Or something else?

I am teaching engineering economics this semester. A lot of talk and equations about the time value of money. That got me thinking about this.

It seems we are making an investment; we expect a return, have an implied timeline, imagine an implied interest rate (zero from these discussions), and have no alternative investments.

How would my students look at this? First, they would like to see a cash flow diagram and some numbers. They would work forward or backward in hypothetical time to evaluate the investment.

Maybe we should get a bit more quantitative in our deliberation. I am happy to help with that.

@birgit.kopainsky @bob Hi. I regret if my earlier note was not clear. The changes I suggest to spend rates (and Bob’s as well) can go in as an amended report from the committee (1002). There is no need for changes to 1001.

We can codify the limits on how much the Stewardship committee can spend, but we’ve got that control in place through the standard budgeting process.

Hello all,

I’ve checked back in with the proposed Stewardship Committee and would like to provide a quick report out:

All members of the to-be-appointed Stewardship Committee are devoted to building the resource base for the Society and are not likely to incur expenses that are frivolous or unnecessary.

Well-established and highly efficient fund raising operations based on philanthropic giving are known to have significant costs. Jørgen Randers used to have responsibility for a very large and professional fund-raising organization at the World Wildlife Fund and he has cautioned us not to expect some sort of “magic” where it will be possible to raise significant funds without making investments in capacity.

We are taking our job very seriously and are thinking big. Doing the advance work will require time and effort—an amount of time and effort that will have to be supported by dedicated staff. We can only reiterate that we will not incur expenses that are frivolous or unnecessary but adjusting the proposed budget to make it look like reducing costs or increasing revenues is more science fiction than science.

Re: the Stewardship Committee, Policy 10A (under Bylaw XII), with the vote March 5 to 15. I’ve read this carefully, but am still unsure whether there are sufficient checks and balances exist to ensure that the disbursement of funds will “support the long-term growth of the Society and the field of SD”–and not fall prey to conflict of interest (including self-dealing). Section 5 tells me that the committee will submit a budget for its intended activities, and that the Finance Committee will have oversight over specific expenditures. I suppose the Finance Committee will ensure that the expenditures adhere to general rules of how the Society disburses money in legal fashion. But this is not the sort of check I have in mind. Suppose a member of the committee proposes that the Stewardship funds be used in a way that benefits that individual (e.g., an organization in which that person has a financial interest). This sounds like a conflict of interest to me, but I see no strong check in the proposed policy against such spending. The Policy Council has a chance to weigh in at the beginning of each year as to the general nature of the expenditures, but specific expenditures may bend in the direction of conflict of interest or self-dealing, and the Finance Committee is not sufficient check against that. Isn’t this similar to the problem with the original Legacy Fund? What can we do about it so that the PC has more oversight?

Thanks for the post Jack - I moved it to the Stewardship Committee thread - hopefully you can still find it.

The Finance Committee does have oversight on spending by the Stewardship Committee and it has the fiduciary responsibility to ensure the proper use of those funds, including ensuring that things like self dealing do not occur. This is all in line with our new bylaws which set up the Finance Committee as a Committee of the Board so that it inherits the responsibilities of the full PC around financial matters.

That said, we did not include things like prohibitions against self-dealing as it seems like they go without saying. The bylaws do state that the won’t be compensated, and we will require that members complete the conflict of interest form. We could certainly add into the policies an explicit prohibition on self-dealing, though I worry a little bit about having wording that might bump against Massachusetts laws relating to non-profit organizations.

Thanks, Bob. I thought you might mention the conflict of interest form, and this shows my ignorance: Is that a form signed only by PC members, or is it also signed by committee members not part of the PC? I believe several of the Stewardship committee are not PC members.
Second, I do worry about human foibles even when good behaviors should “go without saying”. Committee members who bequest large sums of money may naturally feel it is within their rights to direct money to organizations with which they are familiar–even if they have a financial interest in them. They could argue that not to steer money toward those organizations would mean not taking advantage of the best opportunities. After all, they might argue, how many good opportunities are out there, and shouldn’t we choose the best? In such cases, I would think the committee member might properly mention the opportunity, but then should also identify their financial interest, and then recuse themselves from any vote. This is precisely how this sort of thing gets tricky and is not so obvious…and maybe requires explicitly wording in the policy statement. Hope that makes sense.

Thanks, Jack, for flagging this. The core idea of the Stewardship Committee as described in Policy 10A, section 4, is to support support core operations of the Society. This is really to avoid issues similar to the ones encountered during the Legacy Fund campaign.

maybe one more clarification (maybe at the risk of creating more confusion than clarification) especially regarding the initial comments by @Eliot_Rich and @bob:
If, for some reason, everything fails spectacularly, the Stewardship Committee will NOT spend more money and come back with another budget request next year.


@jack , thanks for the ideas. We have both the Stewardship Committee and the nascent Investment Committee where members will have influence on decisions for the society. Asking members of both to identify their potential conflicts is a wise move.

I moved this discussion back to this thread after Rebecca pointed out that the website points here for policy council discussion. Sorry for the back and forth.

On a more substantive note, replying to Jack - there is nothing in the current activities and budget proposal (motion 1022 and report 1002) that suggests there will be any spending of activities other than than administrative support for the committee and its activities to raise money.

Should the Stewardship Committee propose a set of activities that involve the Society paying for consultants, prizes, contests… - all of which are consistent with the Bylaws on this, it would make very good sense to lay out restrictions on how spending decisions would be made. We could do that proactively, but 1) I am lazy and 2) we will do a better job of adopting rules when we understand what types of activities are under consideration.