Independent Citizens’ Oversight CommitteeMarch 7, 2011Page 2
this done, but pleased to see that they are now available. At our most recentmeeting, we also recommended that CIRM post all of its private donations andthey have agreed to do this.The CFAOC strongly supported the recommendations of the Little Hoover Commission and SB 1064 which implemented some of those recommendations,although we were disappointed that the SCO was not given statutory authority toconduct performance audits as recommended in the Hoover commission report.Another critical piece to accountability is assuring the public throughappropriate disclosures that CIRM is acting proactively to avoid any potentialconflicts of interest in its decision making process. Unfortunately, Prop. 71 buildsin potential conflicts given the required representation on the ICOC. We believethat CIRM has good policies in place to ensure that ICOC members recusethemselves on votes related to matters where there would be a conflict. CFAOCmembers have raised concerns about potential conflicts of interest as CIRM movesto work more closely with industry. It will be important to be as transparent as possible as these relationships develop to avoid to the greatest extent possible even perceived conflicts of interest-which as we all know can be as damaging as actualconflicts.Finally, a word on CIRM’s governance structure. Last year, the Controller,strongly advocated that the ICOC take advantage of the transition period to newleadership, and redefine the role of the Chair from a co-executive model to anoversight model. Accountability in the oversight of an organization is premised onthe ability of the board to be objective and distinct from management.
That is whythe California Public Employee Retirement System and the California StateTeachers Retirement System both have a policy of voting in support of shareholder resolutions that separate the chair and the CEO of corporate boards because board independence is at the heart of effective governance and accountability. The public deserves no less from publicly-funded agencies. As the Controller hasstated, while the co-executive model may have been appropriate during CIRM’sinitial startup period, CIRM has now moved into the next phase of itsorganizational development, and it is time to have a clear separation of management of CIRM from oversight. The ICOC’s most important role – to