Our next meeting is scheduled for 14 February from 1:30-3:00 pacific time.  The primary agenda item is the review a draft of our annual public disclosure filing with U.S. tax authorities.  If that sort of thing interests you, and you are available to dial-in to a conference call at that time, and you are comfortable with the parameters outlined below, please let me know via a comment or email at stu<at>wikimedia.org.

Thanks.

Selection of visitors

• The committee chair will drive process of soliciting visitors for each meeting, likely thru treasurers list, internal-l, blog post.
• We will limit to one visitor per meeting (we often have complex and confidential discussions so smaller group discussion are likely to be more valuable)
• To give many people the chance to participate, individuals can only “visit” one meeting
• Preference will go to visitors with an audit committee or treasurer role in movement organizations.
• We will also try to ensure rotation among geographies/languages/etc. 

Conditions for participation

• Visitors must agree to keep any sensitive content confidential, and to keep confidential any materials that are distributed prior to publication
• Visitors would be allowed to participate in most discussion, though the Chair reserves right to ask visitors to take some questions/conversations offline
• Visitors would not participate in executive session (when just the committee members meet, without management, the auditors, etc.)
• Visitors who have a financial/auditing background must be careful, because if they show too much interest they will be sought as future audit committee members.

This is an experiment that we’ll try for a couple meetings, and all of these are subject to change/improvement.

More importantly, we demonstrated once again the power of our community model. The thousands of you who participated in the community RfC. The volunteer administrators who helped crystallize our consensus. The incredible design, engineering and operations teams which implemented massive changes to world’s #5 web site less than 30 hours after the community’s decision. The editors who honed messaging. The lawyers who helped navigate so many tricky issues. The communications teams globally who spoke and wrote hundreds of times in support of our goals today and of our broader mission.

I have never been more proud to be a part of our community. Today we came together. Staff, volunteer, it didn’t matter. We all did it together. We are all the community.

Our work isn’t done. The principles (and money) behind SOPA/PIPA won’t just go away. Politics doesn’t work like that. And we have a few other challenges. Getting free knowledge to more people (500 million people a month is nice, but it’s just a start). Getting and keeping more new editors. Seeding Wikimedia communities in places they haven’t developed on their own. And many more.

But those are for tomorrow.

Today, let’s celebrate the fact that, eleven years after the birth of Wikipedia, the Wikimedia movement is stronger than ever.

-s

============================
Stuart West
Proud Wikimedia Board Member
stu<at>wikimedia.org

First off, if we want to put this in human terms, we need to think about people and not Page Views or one of the other metrics out there. One source for that is comScore, which has released fairly recent global data for November 2011 based on its panel of 2 million internet users.

Since the blackout itself is only on English Wikipedia, let’s start there. comScore estimates that each month 236 million people (or “Unique Visitors”) come to the English Wikipedia globally from a browser on a computer. Of that, comScore estimates 25 million people daily (or “Average Daily Visitors”). That’s a good start for an estimate of how many people will encounter the blackout. But we have to consider a few things:

• comScore’s panel excludes internet access from schools, internet cafes, and anyone under the age of 15. It’s also focused on countries with well-developed online advertising markets, so may have less complete data for many countries. For example, Wikipedia’s server logs show it actually delivers about triple the page views that comScore’s panel reports. Let’s be conservative and double comScore’s estimate to fill in the gaps in its coverage, which gets us up to 50 million people.
• The comScore daily average is across 7 days a week, and Wikipedia traffic is typically lower on weekends. So let’s add another 20% for a Wednesday, getting us up to 60 million people.
• comScore specifically excludes mobile traffic, which is probably up to 15%+ of total Wikipedia traffic. To ensure emergency use, mobile users to English Wikipedia are simply seeing a banner. That gets us up to let’s say 70 million people.
• With all the press coverage, we may see an uptick in visitors. Let’s say 10%.

That gets up to an estimate of 75 million people affected by the English Wikipedia blackout and mobile protest.

A few other language Wikipedia communities are supporting the English Wikipedia community with banners or other notices, including the Japanese (5.8 million daily visitors according to comScore), Spanish (5.5 million),  Russian (4.2 million), German (3.7 million), Portuguese (1.7 million), Italian (1.3 million), Arabic (960k), Chinese (900k), Vietnamese (325k), and Korean (175k), plus other language Wikipedias that comScore doesn’t break out including Polish, Norwegian, Swedish, Catalan, Czech, and Ukrainian. That adds up to another 25 million, and if you apply the same adjustments as above gets us up to another estimated 75 million people affected through banners and notices on other language versions of Wikipedia.

So, a reasonable estimate suggests that 150 million people will see the various Wikipedia actions globally.  Wow.

-s

UPDATED 7:45a Pacific time to include more language versions of Wikipedia which I didn’t know would be showing banners or other notices.  That’s another 9mm comScore daily visitors which with adjustments to fill gaps in comScore coverage suggests 75 million people will see banners (up from earlier estimate of 45 million).  That increases overall estimate to 150 million (up from earlier estimate of 120 million).

PS — Below is some detail of the raw comScore data for a few different countries. To fill the above-mentioned gaps in comScore’s coverage, you need to triple these raw numbers to get a good estimate of actual visitors.

• In the U.S., comScore estimated 78 million people visit the English Wikipedia a month (about 42% of U.S. internet users). That works out to about 9.5 million people on an average day.
• In the U.K., comScore estimated 18 million people visit the English Wikipedia a month (about 49% of internet users). That works out to about 2.8 million people a day.
• In Canada, comScore estimated 13 million people visit the English Wikipedia a month (about 54% of internet users). That works out to about 2.1 million people a day.
• In Australia, comScore estimated 5.5 million people visit the English Wikipedia a month (about 40% of internet users). That works out to about 700k people a day.
• In Germany, comScore estimated 5.8 million people visit the English Wikipedia a month (about 11% of internet users). That works out to about 400k people a day. The German Wikipedia is also showing a banner so that adds 24 million monthly visitors (48% of internet users), or 3.2 million per day who will see something blackout-related.
• In France, comScore estimated 4 million people visit the English Wikipedia a month (about 10% of internet users). That works out to about 250k people a day.
• In Russia, comScore estimated 3 million people visit the English Wikipedia a month (about 6% of internet users). That works out to about 200k people a day seeing the blackout. The Russian Wikipedia is also showing a banner so that adds 21 million monthly visitors (40% of internet users), or 2.6 million per day who will see something blackout-related.
• In India, comScore estimated 16 million people visit the English Wikipedia a month (about 35% of internet users). That works out to about 1.5 million people a day.
• In Malaysia, comScore estimated 3 million people visit the English Wikipedia a month (about 27% of internet users). That works out to about 285k people a day.
• In the Netherlands, comScore estimated 2.7 million people visit the English Wikipedia a month (about 23% of internet users). That works out to about 253k people a day. The Dutch Wikipedia is also showing a banner but comScore doesn’t yet track it separately.
• In China, comScore estimated 2.9 million people visit the English Wikipedia a month (about 1% of internet users). That works out to about 230k people a day. The Chinese Wikipedia is also showing a banner so that adds 4.8 million monthly visitors (1.4% of internet users), or 346k per day who will see something blackout-related.
• In Turkey, comScore estimated 2.9 million people visit the English Wikipedia a month (about 12% of internet users). That works out to about 195k people a day.
• In Spain, comScore estimated 2.4 million people visit the English Wikipedia a month (about 11% of internet users). That works out to about 160k people a day. The Spanish Wikipedia is also showing a banner so that adds 9.4 million monthly visitors (43% of internet users), or 1 million per day who will see something blackout-related. The Catalan Wikipedia is also showing a banner but comScore doesn’t yet track it separately.
• In New Zealand, comScore estimated 1.2 million people visit the English Wikipedia a month (about 42% of internet users). That works out to about 150k people a day.
• In Japan, comScore estimated 2.6 million people visit the English Wikipedia a month (about 3.5% of internet users). That works out to about 140k people a day. The Japanese Wikipedia is also showing a banner so that adds 39 million monthly visitors (54% of internet users), or 5.6 million per day who will see something blackout-related.
• In Brazil, comScore estimated 2.4 million people visit the English Wikipedia a month (about 5% of internet users). That works out to about 140k people a day. The Portuguese Wikipedia is also showing a banner so that adds 16.5 million monthly visitors (36% of internet users), or 1.5 million per day who will see something blackout-related.
• In South Africa, comScore estimated 1.5 million people visit the English Wikipedia a month (about 22% of internet users). That works out to about 125k people a day.
• In Italy, comScore estimated 2.1 million people visit the English Wikipedia a month (about 9% of internet users). That works out to about 125k people a day. The Italian Wikipedia is also showing an interstitial and banner so that adds 10 million monthly visitors (42% of internet users), or 1.1 million per day who will see something blackout-related.
• In Singapore, comScore estimated 1 million people visit the English Wikipedia a month (about 35% of internet users). That works out to about 125k people a day.
• In Sweden, comScore estimated 1.3 million people visit the English Wikipedia a month (about 21% of internet users). That works out to about 115k people a day. The Swedish Wikipedia is showing a banner but comScore doesn’t track it separately.
• In Mexico, comScore estimated 2 million people visit the English Wikipedia a month (about 9% of internet users). That works out to about 110k people a day. The Spanish Wikipedia is also showing a banner so that adds 10 million monthly visitors (47% of internet users), or 1.2 million per day who will see something blackout-related.

Attached is a detailed worksheet with more comScore data for those data nerds who’d like to dig in. I’ll update this post as more info becomes available.

…the issue as I see it is a fundamental tension between our decentralized culture and the challenges of our newfound wealth. Together, over the past few years, we have all built some extraordinary capabilities in raising funds to pursue our vision. That has given us tremendous resources to pursue free knowledge. But if we want to continue to have access to resources at that scale, we have to accept the responsibility to our donors to ensure every contribution is spent wisely and with the greatest impact. That requires a concentrated effort to analyze spending and opportunities and allocate donor funds effectively. Some system has to play that role, and some group of people has to carry out the work of that system.

Whoever plays that role — the Foundation, the Board, a new entity like the FAC, whatever — it’s going to be hard and time-consuming and painful. And frankly it’s not at all fun — you have to make some hard decisions, say “no” to people, and at times be very very unpopular.

But it’s a role that has to be played. We cannot just ignore that responsibility to our donors for a few months or years until a Volunteer Council, Movement Roles, the FAC, or some other group is able to focus on the issue, come to agreement on a system, and then build the capability to carry it out consistently. That is why, in my role as the Treasurer of the Board of Trustees, Chair of the Audit Committee, and long-term member of our community, I have pushed and will continue to push Sue and the Foundation very hard to play the assertive role it is playing now. It just has to be played. Our obligation to our donors has to be fulfilled. We have to try, and an imperfect system of grants and project plans and annual reporting is infinitely better than no system.

If you have a problem with the current system, come to me and complain. Come to the Board and complain. Do not personally attack Sue and her staff. Do not challenge their professionalism. You are completely misdirecting your frustration. Get angry at me. Get angry at the Board. Flame us, but don’t flame the 90 incredibly committed, incredibly passionate believers in our cause who have chosen to devote not just themselves but their careers to our mission. We are incredibly lucky to have them in our movement, working with us to build our shared vision.

Even more appropriate, get angry at life. Get angry at the amazing impact we are having. Because what we are experiencing is a natural outgrowth of our success. It is what happens when you build something that helps a half a billion people a month. When over a million people want to support you with donations. This is what is called ironically in English a “high-class problem.” For all the hand-wringing that’s going on, we are incredibly fortunate to have this wealth to spend.

This tension is understandable. Our culture is decentralized. That’s what attracted a lot of us to the projects in the first place. That’s what made our projects so great. And as volunteers, most of us like the luxury of being able to choose exactly what we work on. But if we want to continue to have such amazing resources to pursue our cause we are going to need a system to help us allocate and monitor the use of donor funds. And that will involve a different kind of decentralization, and perhaps a different degree of decentralization, than we are used to. That’s what we have to accept. Everything else – the nature of the system, who operates it — is just a detail.

So in the end I’m saying I agree 100% with Craig. We all need to accept that there has to be some system in place to make tradeoffs in a sincere effort to ensure donor funds are spent well, whether it is the Foundation, the GAC, or a new FAC, or a peer review process, or a Magic 8 ball. And we need to accept that sometimes we won’t personally like the answers that come out of that system. But we still need the system.

And that brings us to this amazingly long discussion page, and to Sue Gardner. Sue and her team are making an extraordinary effort to reach out for feedback, input and help in figuring out the right answer for what this system to be. They chose to do this a month ahead of the board meeting, six weeks ahead of the Finance meeting in Paris, and three months ahead of the Chapters meeting, to ensure as much time as possible for collaborative problem-solving. I applaud what they are doing. I think those who respond to their outstretched hands by slapping them aside with a wave a rhetoric and bile are letting our entire community down. Take advantage of this opportunity. Join the discussion. Please. We need all of you and your best thinking so our community and movement can figure this out together.

Let me set this up as a thought experiment. Imagine that we can all go back to the beginning of our movement. Imagine that we have a clean slate and can start fresh. But also imagine that we have the benefit of the past 10 years of experience, and with it all the lessons we’ve learned about ourselves and our strengths and weaknesses as a community.

Let’s say our objective is to define the basic structure of a movement that will most effectively help our community pursue our vision over the next 100, 200 or even 500 years. Long-term impact is the primary objective.

If we could start over, how would we organize our movement?  In particular I’d love input on three questions:

1. Are current political/legal boundaries the best primary organization model for our movement? Or instead would we choose to build things a different way, say around each of our projects, or languages, or some of the passions among our community (e.g. a GLAM Chapter), or other special interests and topics (e.g. arbcom, comcom, translate-l)?
2. Should we give special rights to certain kinds of movement entities (e.g. special rights to pick board seats outside of elections, exclusive access to things like the trademarks, preferred access to donor funds)?
3. Are legal entities worth the effort on a large scale? Our current chapters model is leading us to having a hundred or more legal entities globally. Is this worth all the overhead involved? Or would informal associations and affiliations be fine in many cases?

Below are some notes that I’ve kept as I try to think through the issue. They aren’t intended to be comprehensive. Feel free to review or ignore as you think through and respond to the above questions.

Thanks.

-s

Background notes

The different kinds of affiliation in our movement:
– Many editors/contributors have no organizational association. They work on their own, editing articles and making contributions without a great deal of interaction with others in the community.
– We have many loose, informal affiliations. Talk pages provide a place for editors with a shared interest in a particular article. WikiProjects bring together editors into cross-article collaboration. Village pumps provide another project-based way to build community. Other affiliations include interest groups such as GLAM, projects like Wiki Loves Monuments, and the many groups of volunteers brought together by mailing lists like comcom and translate-l.
– We have a global Wikimedia Foundation entrusted with the trademarks and with the responsibility to operate the websites and technical/legal infrastructure behind the projects.
– Finally, we have country-based chapters which receive significant special rights.

We started with geographic chapters in 2003. The model has developed so that these geographic organizations now receive rights unique in our movement including a) exclusive geographic right to use the trademark, b) preferred access to donor funds from the annual fundraiser, and c) the right to appoint two of the ten Trustees on the Board of the Wikimedia Foundation.

We’ve had one chapter grow into a large organization (Wikimedia Deutschland), and few others hire small numbers of professional staff, and others in varying degrees of development. A number of chapters appear to be defunct, with minimal or no programmatic activity.

There has never been a clear definition of success for a geographic chapter. I ask most chapter members and chapter leaders I meet what their organizational objectives are and I get widely varying answers. Few say they have a role representing or serving the editing community. So it’s not a surprise that when I ask editors about the role of the chapter where they live, I often get a shrug and a disinterested look.

As a result, we do not have a way to assess the performance of geographic chapters. How do you measure impact in a specific country when our projects are all cross border? Is it odd that a global movement is trying to organize itself around existing nation states?

Exclusive trademark use, preferred access to donor funds, and the right to appoint trustees are a really big deal. Should other groups receive these rights? ArbCom is critical, but receives no such special treatment. GLAM effort have been an extraordinary success. It has brought together a global community sharing a strong passion. It has spawned projects like Wiki Loves Monuments which are amazing in helping pursue our vision. Yet it has no special access to donor funds. It has no exclusive right to the trademarks. It has no right to appoint Board members. Is that appropriate?

Is this conflict a core driver of the failure of our movement roles effort, despite 18-24 months of effort, to drive any resolution? As someone not that involved in the movement roles effort, it seems the team has assumed that geographic chapters will be the core of our organizational design. Maybe that foundational assumption is just not the right one.

Legal entities, and fundraising activities under the Wikimedia name, create a huge amount of overhead. As the Board’s Treasurer and Chair of its Audit Committee, I have very high expectations for any legal entity granted use of the trademarks or access to donor funds. Do we get enough value out of having legal entities to justify the extra effort and overhead?

Let’s assume that fundraising or access to funds isn’t much of a priority for our movement now. Over the past 10 years our community has cracked the code on how to approach our global readership for donations. We are essentially now in a position where we collectively are able to raise all the money we can practically spend in pursuit of our mission.

Note:  The WMF Exec Director Sue Gardner has started to post some of her preliminary thinking on related issues on meta. She goes into a lot of detail and it might be worth a read.

One of the things we’re doing to kick things off is outline how each of our organizations is trying to address these issues. See below for a list email I did today with my perspectives on the Wikimedia Foundation’s governance from my position as its Treasurer.

If this kind of detailed and occasionally technical discussion is your kind of thing, please join us. You can subscribe at http://lists.wikimedia.org/mailman/listinfo/treasurers.

To begin sharing ideas and best practices, let’s start threads on the governance/accountability/transparency practices at each of our organizations. I’ll go first with my views on the Wikimedia Foundation. A few others from the WMF are on this list too. Please add new thoughts or help answer questions!

I want to thank Thierry for his note to Foundation-l in late August covering many of these issues for Wikimedia France. That was fascinating for me and helped inspire my interest in this list. Thierry, maybe you could update that email and send it around to this list on a new thread?

This will be long, and may be repetitive for many of you. But I think it is important to share a thorough overview. It would be great if others could aim for the same level of detail / section headings when introducing their own organizations. I’m really interested in learning from what you all are doing.

WMF Overview
The Wikimedia Foundation is a U.S.-based non-profit corporation created in 2003. It received tax-exempt status in 2005. Its primary governing document is the bylaws at http://wikimediafoundation.org/wiki/Bylaws. The Foundation is the holder / owner of the trademarks, including Wikimedia and Wikipedia, and the operator of most of the websites used by the projects.

Governance
The Foundation’s governing body is its Board of Trustees. As a U.S. non-profit, the Foundation has some flexibility setting size and composition of its Board. We decided in early 2008 to have 10 members. The editing community (mostly) elects three seats in odd years (e.g. 2009, 2011). The Chapters as a group appoint two seats in even years (e.g. 2010, 2012). The founder seat is for Jimmy Wales. The Board itself appoints the four remaining members to bring necessary expertise to the Board. Board member serve for two years terms.

With appointed members, we attempt to identify gaps between the existing membership and the skills we need to fulfill our duties. For example, the Board identified financial, auditing, and organizational governance experience as an important skill to have. Since we have not typically found that in the community elected/appointed members, the Board sought out someone with that background. That’s me.

Not all Board seats have been filled at all times, but we currently do have the full 10 members. There’s a lot of work to do, and a lot of perspectives to consider, so having a full Board is really good.

Each year at Wikimania, the Board elects four officers: A Chair, a Vice-Chair, a Treasurer, and a Secretary. A few years ago we wrote detailed definitions for three of those roles: http://wikimediafoundation.org/wiki/Chair, http://wikimediafoundation.org/wiki/Treasurer, and http://wikimediafoundation.org/wiki/Secretary. The Vice-Chair role is mostly to be backup to the Chair and is typically included on all communications with the Chair.

We try to have different trustees in each officer role. Last year I was both Vice-Chair and Treasurer. It got to be too much work for one person, though, and we are sensibly back to one-person, one-office this year.

It can sometimes be challenging to have everyone focus on something at the same time, so we’ve experimented with another informal role of “whip.” That’s a term I’ve heard in U.S. and U.K. politics to describe someone who is responsible for collecting votes, keeping us on schedule, etc. We’ve had mixed success with that role, though. It’s hard for someone to always be the “bad guy.”

The Board has delegated duties to three formal Board committees: an Audit Committee which I chair, a Human Resources committee responsible primarily for evaluating the Executive Director and for overseeing compensation, and a Board Governance Committee responsible for assisting in governance matters. We’ve only written a formal chatter for the Audit Committee (http://wikimediafoundation.org/wiki/Audit_charter) but I wish we had more because it is really helpful to set clear expectations.

The Audit Committee was, at first, quite small and comprised mostly of Board members. But we found that fairly few trustees from the community had both the experience and the time to focus on its work. So for the 2009-2010 year we switched to a model where one trustee leads the Audit Committee (me), and then we reach out broadly to the community for members. We’ve had great success with that model, and continue to have really valuable participation from community members. Membership history is at http://wikimediafoundation.org/wiki/Audit_committee. The Board’s Chair and the ED sit in on meetings.

Because of early investments in movement-wide fundraising, the Board has been able to hire a staff. It no longer plays an operating one. We do not get involved day to day in the operations of the foundation. We do not hire staff, other than the executive director. We do not interact with staff in a governance or management role, though we do often in community work.

The Board really has two primary duties: fulfill our governance obligations and hire/evaluate the Executive Director. Most of us also view us as having an additional less-defined but really important third role as one of the movement-wide leadership/decision-making bodies for Wikimedia.

All Board members are volunteers. The time commitment is less than it used to be but is still quite significant. I estimate it’s about 5 hours a week just for board work (excluding editing/community work), plus 10-12 days of meetings/travel each year. The Board meets in person three or four times a year and on IRC a few more times a year.

We maintain a Board manual with lots more information at http://meta.wikimedia.org/wiki/Board_manual. We use this regularly as a reference for ourselves. We also use it to introduce potential new trustees to the role.

Finance/governance/legal staff
Currently we have a chief of finance and administration (Garfield Byrd), a Controller (Tony Le), and a small finance staff. We also have a General Counsel (Geoff Brigham) and a small legal staff. More details on staff are at http://wikimediafoundation.org/wiki/Staff_and_contractors.

Transparency
The two primary vehicles we use for transparency are the Foundation’s website at http://wikimediafoundation.org and of course Meta. The staff publishes activity and technology reports each month at http://meta.wikimedia.org/wiki/Foundation_reports. The staff also publishes semi-annual financial reports and government filings at http://wikimediafoundation.org/wiki/Financial_reports. The Board publishes its minutes at http://meta.wikimedia.org/wiki/Foundation_reports and its resolutions at http://wikimediafoundation.org/wiki/Resolutions.

Financial audits
In the U.S., independent auditors focus on the financial statements and controls behind them, testing management’s draft results against transaction records and against U.S. GAAP. The WMF’s Audit Committee has engaged the San Francisco office of global auditors KPMG in 2008. Previously, the WMF had worked with a small Florida auditing firm called Gregory, Sharer & Stuart. KPMG’s latest audit is at http://upload.wikimedia.org/wikipedia/foundation/a/ac/FINAL_10_11From_KPMG.pdf. Like many U.S.-based non-profits, our fiscal year ends on June 30, mostly because it’s cheaper to get auditors in the off-cycle and it gives more time to catch up on end-of-year fundraising paperwork.

Government regulation
The primarily federal regulator of non-profits in the U.S. is the Internal Revenue Service, which grants non-profit status and requires annual public filings of our activities. This Form 990 is due about nine months after the end of our fiscal year and the WMF usually file in March or April. The most recent Form 990 is at http://upload.wikimedia.org/wikipedia/foundation/1/1c/WMF_2009_2010_Form_990.pdf. The WMF is also subject to the state laws of Florida (where it is incorporated) and California (where it is headquartered). There are also registration requirements around fundraising in many of the 50 states in the U.S.

Mission oversight/planning/accountability
The financial audit and IRS filings cover financial reporting, controls, and transparency. They do not substantially address whether the Foundation’s activities are consistent with the mission. IMHO, no one from outside our community could have a big impact in this role.

So this duty falls to the Board. Here’s a summary of the framework we use.

First, a few years ago the Board commissioned a five-year strategy plan to identify top focus areas. We did this through a fantastic community-driven process. The result was the plan at http://strategy.wikimedia.org/wiki/Wikimedia_Movement_Strategic_Plan_Summary, which continues to be a guide on priorities and objectives.

Second, each year in the early Spring the Executive Director and her staff put together an annual operating plan. The ED typically gives the Board a high-level summary of her thinking sometime in January or February. The she and her team prepare a detailed plan. As Treasurer, I review this thoroughly with the ED and give extensive feedback both on high-level issues and, since I have experience budgeting, on planning issues.

Third, we then have a series of increasingly detailed reviews with the full Board. We typically focus on whether the high-level objectives of the annual plan are a) consistent with the mission and the strategy plan and b) achievable. We each try to reach out to people in the community to collect feedback/ideas as part of our reviews. As Treasurer, I give my recommendation to the Board on the plan. Then we have a vote. Typically, the Board approves the annual plan in late June and the staff publishes it around the July 1 beginning of our fiscal year. The plan for this year is at http://upload.wikimedia.org/wikipedia/foundation/3/37/2011-12_Wikimedia_Foundation_Plan_FINAL_FOR_WEBSITE_.pdf.

Finally, each year the Board reviews the performance of the Executive Director against the mission objectives/deliverables laid out in both the annual plan and the strategic plan.

Wrap-up
OK. That’s all i can type today. Thanks for your patience with the long note. I wanted to get us all off to a good start on sharing different approaches on these issues. I’m happy to answer any questions. And I’m excited to hear similar overviews for other organizations. Who’s next?

The Board of Trustees has recently reviewed our fundraising model and issues related to the way donor funds are received. This review followed detailed discussions among the Board’s Audit Committee and with our outside auditors, which highlighted issues about the level of financial controls over donor funds that go directly to the chapters who act as payment processors. This review focused on the model established last year, under which donors in certain countries are exclusively directed to the local chapter during the annual fundraiser. In our 2010-2011 year, about $4M net went directly to 12 chapters, representing roughly 15% of the total funds donated to the movement.

There are several problems with this model, and with the current fundraising situation. Some chapters have received large sums of money early in their organizational lives, before they have built the capacity and financial controls to safeguard and best use those resources in pursuit of the mission. Some chapters have received many times their planned budget in a single fundraiser. Additionally, in some countries, transferring funds internationally has been limited by regulatory constraints.

There are also currently no movement-wide controls applied consistently to all entities that receive donor funds. Some chapters, despite being well-funded, have not reported in a timely way on their activities, their financial status, and their use of donor funds, or have had difficulties following the regulatory requirements of their countries.

This fundraising model has also contributed to significant resource disparity among chapters. Some of the largest fundraising chapters have revenue far greater than their stated need and capacity to spend, while other chapters receive revenue only from Foundation grants or have almost no revenue at all. The model also suggests that chapters are entitled to funds proportional to the wealth of their regions, which amplifies the gap between the Global North and South.

We need to improve our model to address these concerns and to improve the distribution of donor funds across the Wikimedia movement.

Design principles
Our design principles for improving the fundraising model are:

• We are deeply committed to decentralized pursuit of our mission and to supporting the long-term sustainability of chapters and other movement partners.
• Because of its role as operator of the websites, the Foundation has to be satisfied that any organization directly receiving donor funds will treat them with an appropriately high level of care and transparency.
• An organization can directly receive donor funds as a payment processor if the following criteria are met:
1. There is sufficient money raised in the geography to merit the logistical effort.
2. The organization offers tax deductibility or other incentives to local donors.
3. Regulatory issues about any international funds flows are fully resolved.
4. The organization’s current financial resources are not enough to fund proposed program work.
5. The Foundation can confidently assure donors to the chapter that their donations will be safeguarded, that our movement’s transparency principles will be met, and that spending will be in line with our mission and with the messages used to attract donors.
• The donation process should clearly disclose basic facts about the organization receiving the donation.
• The Foundation is committed to a grants program to continue to provide funds to those who can most effectively pursue our mission.

Next steps
These concerns need to be substantially addressed prior to the start of the 2011 fundraiser. In particular, we expect all parties to live up to current fundraising agreements including full compliance with all reporting deadlines.

We appreciate that some chapters have already started working on their budgets assuming that they would participate as payment processors in the 2011 fundraiser, but may not be able to meet the new criteria outlined above. The Foundation will work with these chapters to follow through on the principles of the current Fundraising Agreement to provide the necessary funds to continue their programmatic work and to meet their operational needs.

The Foundation will significantly expand its grants program, and should work closely with the Audit Committee to continue improving the controls and disclosures around grants.

Wikimedia Board of Trustees — activity report May-June 2011

Resolutions and votes

Controversial content

• Controversial content resolution — this resolution was passed in May after a year-long process of discussion and research. It reaffirms the Board’s position on censorship, calls for continued community involvement in image review and asks for the creation of a personal image filter feature which would allow readers to not choose whether to view certain classes of images.
• Images of identifiable people resolution — this resolution was passed in May along with the controversial content resolution. It lays out the Board position on image subject consent, specifying that evidence of consent should be obtained and documented from the subject of the media for images and videos of living, identifiable persons in private situations that are hosted on Wikimedia projects.

New chapters

• Wikimedia Canada and Wikimedia Chile were recognized. Both are recently incorporated.

New advisors and observers

• Advisory board additions — Jessamyn West and Veronique Kessler were nominated for the advisory board by trustees and approved by Board vote. Jessamyn is a U.S.-based librarian and blogger who is also a community manager of Metafilter, a global online community; and Veronique is the WMF’s outgoing Chief Financial Officer.
• Board Visitors — passed in May, this resolution lays out parameters and criteria for inviting visitors to Board meetings, and defines that approved Board visitors may be invited to one meeting a year for most agenda items. Visitors will not have voting rights or email list access.
• Visitor appointment — the first visitor to be invited was Doron Weber from the Sloan Foundation, invited in June for the coming year.

Strategy and planning

• Annual plan approval — The Board unaminously approved the WMF’s annual plan for 2011-2012. The plan is developed by the executive director with input from the Board and senior staff, and lays out WMF’s budgeting, hiring and programmatic plans for the year. A draft of the plan was shared with the Board in May, and the final document was reviewed in June, with review led by Stu as the board Treasurer.

Other Board work

• The Board Governance Committee (Matt, Jan-Bart and Ting) contracted with a consultant and scheduled the 2011 trustee evaluation process. They also kicked off the officer election process by calling for candidates and candidate statements. Elections will be held in Haifa.
• The Audit committee, led by Stu, wrapped up its work for its 2010-2011 year. During the year, the committee held three meetings in August, October, and March. It covered the basics, reviewing the audit plan, audit results, and the Foundation’s annual IRS filing, as well as helping improve the FAQs and other public disclosures of the Foundation’s financial position. The primary non-routine issue this year involved the transparency and financial control implications of certain chapters directly receiving donor funds, and the committee contributed some energetic editing to support the new consolidated movement-wide reports page on meta. The Committee also weighed the alternatives for independent auditors over the upcoming year and decided to re-engage KPMG and expand KPMG’s role somewhat to provide further guidance and assistance around fundraising models. Finally, Stu sent out a call for volunteers for the 2011-2012 fiscal year.
• As Board Treasurer, Stu held a few meetings with Sue and her staff to review the annual plan and then provided a recommendation that the Board approve the plan.
• Stu was also active in the interviewing process for the Foundation’s new Chief of Finance and Administration.
• Movement roles work to define the relative roles of Wikimedia entities continued on Meta, including Sam, Bishakha, and Arne, producing a set of draft recommendations to the Board and to movement groups.
• In May-June 2011 the Board met twice online to review the annual plan.
• The Board’s next in-person meeting is scheduled for Wikimania in Haifa, Israel.
• Meeting agendas and details are shared at m:Board meetings.

Trustee outreach and other activities

• In May, Kat visited the WMF offices, to meet with Foundation lawyer Geoff Brigham and to help develop a summary of WMF legal practices. This has been posted for comment.
• In June, Ting attended an event organized by Wikimedians in Almaty, Kazakhstan and spoke to an audience of students. The local Wikimedia group has freed an entire 16-volume Kazakh-language encyclopedia by getting the publisher to agree to a free license and release the digital files, with the goal of adding the content to the Kazakh Wikipedia. They have received a grant to work on this project, and are also interested in becoming a chapter.
• June 14, Sam attended a meeting of the Digital Public Library of America (DPLA) project, which is bringing together several major research and public libraries as well as library organizations to develop a common framework for shared digital library collections in the U.S.
• ALA: in June, Phoebe, along with Sue and staff members Frank Schulenberg and Annie Lin, attended the American Libraries Association (ALA) annual conference, the largest library conference in the world, in New Orleans, USA. Sue gave the keynote address, Frank and Annie staffed a booth promoting the campus ambassador project, and Phoebe participated on a panel called “The Wikipedia Effect: How Wikipedia Has Changed the Way the World Finds and Evaluates Information” (also on the panel: Paul Kobasa, editor-in-chief of the World Book encyclopedia).
• In May, Bishakha visited Bangalore and met with the India chapter’s Executive Committee members and attended Bangalore meetup 33. On May 14, she attended Pune meetup 13 and met with prospective Campus Ambassadors in Pune. In June, Bishakha attended the daylong 4th Malayalam wikimeet in Kannur, Kerala. Highlights: the release of the first Malayalam WikiSource CD, a visually impaired man’s demo of using text to speech software on Wikipedia, and meeting the youngest Malayalam contributor, a 7-year-old who shot and uploaded 14 images of food to Wikimedia commons. National program consultant Hisham Mundol was also present at all these meetups.
• Jimmy was as usual traveling the world for meetings, speeches, and press work. He was scheduled to speak at a conference of Nobel Prize winners in Morocco in early May, but the conference was cancelled due to the terrorist attack. In mid-May he went to Germany at the request of Wikimedia Deutschland to film a video in support of the UNESCO initiative, as well as a fund raising video. At the eG-8 meeting in Paris, he was invited to a private lunch with President Sarkozy at the Élysée Palace. Other attendees included Rupert Murdoch (News Corporation), Arthur Sulzberger, Jr. (New York Times), Eric Schmidt (Google), and others; copyright enforcement was high on the agenda, and Jimmy spoke about the importance of free culture and community sharing. Other meetings took place in London, Washington DC, Moscow, Zermatt (Switzerland), and Israel (met with Shimon Peres).

Many groups have discussed this issue over the past few years, including the Audit Committee (which I chair), our independent auditors KPMG, the Movement Roles group, the Chapters who have been working closely on the fundraising agreement with the Foundation and Barry Newstead’s development team, and the Board (e.g. see our resolution on the importance of transparency in use of donor funds). But progress has been difficult because this is a hard issue.

Here’s some background. Our historical model for fundraising, developed in 2006, is that chapters who meet some basic criteria have the opportunity to automatically receive 50% of the fundraiser donations on wikipedia.org from within their country. In the year ending June 30, 2011, about $4.3 million net went directly to chapters, roughly 15% of the $29.5 million donated to the movement. Other chapters, and the rest of the movement, instead apply for project-specific grants that the Foundation helps administer.

In the five years since this approach was put in place, a lot has changed. We’ve grown from a half-dozen chapters in Europe to 34 chapters across six continents. Our collective fundraising capabilities have soared from $1.5 million a year to $30 million. We’ve created a robust, transparent grantmaking process and formed a Grant Advisory Committee with 16 community members half of whom live in the Global South. And finally, the movement has collectively developed and put in place a strategic plan that clearly outlines priorities for spending over the next few years.

The issue is whether our approach to distributing funds to chapters should change along with all the other things that have changed over the past five years. Here are a few key questions I’m asking myself:

• Is it right that 50% of rich country donations stay in those rich countries? 95+% of dollars donated to the Wikimedia movement come from Global North countries, so this results in a major skewing of how dollars are invested in the mission. Our strategic plan lays out a priority that we increase investment in the Global South, both in programs and in technologies like mobile. At first glance, the precedent that 50% of all rich country donations automatically stay in those rich countries is a direct contradiction to the thoughtful, nuanced priorities laid out in the strategic plan.
• How do we establish solid movement-wide financial controls to protect donor funds? How do we ensure transparency of the use of those funds? The Foundation needed four or five painful years before it had the financial controls, program activities, and maturity to handle large sums of money. Some of our chapters are getting hundreds of thousands of dollars within the first year or two of their organizational lives. Many are young organizations, without much operating history or experience managing money, budgets, or programs. The recent track record of reporting on activities, financial status, and spending of donor funds, and even of following basic regulatory requirements, is not where we’d all like it to be. We have seen chapters struggle, trying to quickly evolve controls and comply with local regulations, and figure out how to spend cash effectively in pursuit of the mission. This problem will only get more severe as the number of chapters continues to grow, and stretches even further the support infrastructure provided by ChapCom and Barry’s team. There are real risks of something bad happening (most likely inadvertent) with so much money flowing around orgs that don’t have good uses established for their funds.
• Who is ultimately responsible for stewarding donors’ contributions? We now have a large base of donors who support us, contributing based on a core set of messages and commitments like the strategic plan. The Wikimedia Foundation does have some special legal responsibilities (called fiduciary duties) to protect assets like donor funds, the reputation of the movement, and even the Wikipedia name. How should it carry out those duties when it comes to financial risk and donor transparency? Right now the Audit Committee serves in that role for 85% of our donor funds, but has no oversight authority over how chapters handle the funds they receive automatically thru the fundraiser.
• How do we address the above questions while maintaining the decentralization that has made our movement so great? This is one of the hardest questions. We must continue supporting any team or entity that consistently drives the mission forward, even when larger sums of money drive the requirement for financial controls and monitoring.

What do you think? How do we build the right model for the flow of money around our movement, given all these competing realities? Please add your comments below.

We’ve recently started forming the 2011-2012 Audit Committee and as we did last year would like to call for volunteers from the community.  The time commitment is modest, as far as Wikimedia goes:  review the Foundation’s financial practices and financial statements/filings, and then participate in three or four conference calls during the year with the staff and our independent auditors at KPMG (see the Audit Committee charter for full duties).  The primary requirement for membership is “financial literacy”, some kind of professional experience with finance, accounting or audit.  As it is a governance and oversight role, Committee members cannot serve under a pseudonym, undergo the same basic background check as others in WMF financial oversight roles, and must make the same conflict of interest disclosures required of the Foundation’s Board.

If you’re interested in serving on the Committee, please email me at stu wikimedia.org with your resume/CV and your thoughts on how you think you could contribute.  Thanks.