hash algorithm: blake2b-256
body: Reforming Treasury Governance
  abstract: Treasury governance should enable strategic alignment and facilitate decision-making. However, treasury governance within the Cardano ecosystem is in a poor state. First, there is a funding impasse. Second, while being pivotal for Cardano's stability and growth, treasury governance is only indirectly addressed and barely supported by the existing governance system. This governance info action sketches basic ideas for reforming treasury governance and introduces them into public discussion. The goal is to provide an impetus for improving the treasury governance process and to outline guardrails for strategic direction. An implementation will require further refinements and amendments to the current process as well as the constitution. All members of the Cardano ecosystem are encouraged to collaborate in reforming treasury governance into a productive process that enables stability and growth.
  motivation: In its current form, Cardano governance and voting on treasury withdrawals have revealed significant dysfunctionalities. In particular, treasury withdrawal actions from different, but likewise important domains have led to a perceived competition for scarce resources. This opened the door to hostility and detrimental conflict within the community and has invited toxicity. There now is ill will and strife that harm the Cardano ecosystem, endangering its existence. Cardano faces a gridlock over treasury spending between different positions and coalitions in the governance system. And while treasury governance is crucial for the Cardano ecosystem, there is a lack of guardrails and structures that could provide the process with a strategic direction.
  rationale: Therefore, the following ideas are presented for discussion. These basic ideas may freely be adopted, extended or modified for concrete implementation which is beyond scope here. All members of the Cardano ecosystem - institutions/organizations, SPOs, DReps and other individuals - are encouraged to work together on solutions for improving treasury governance. Basic Propositions [a] Treasury governance is pivotal for the Cardano ecosystem, its growth and stability: The process of treasury governance must provide a clear direction, a coherent strategy and a specific roadmap. [b] Treasury governance in the sense of [a] has to be explicitly addressed and supported by the governance system and the constitution. [c] The NCL must not be treated as “potential overall budget” with the alternative of simply saving everything instead: The NCL is at best a vague initial approximation for the concept of a "budget". Only having the NCL (and a collection of incoherent treasury withdrawals) is not enough for effective treasury governance. [d] There has to be a dedicated budget for investing. The budget must include the strategic direction and the roadmap. [e] A thematic budget structure must make clear that various important domains exist side by side. None of these domains can be deferred in favor of another. [f] No isolated treasury withdrawals for individual projects must be put on a vote against one another. See [e] and [g] for further explanation. [g] DReps have to vote on dedicated and balanced budgets, not on the funding of individual projects. This is also necessary to mitigate the burden of directly comparing individual proposals which is cognitively inefficient. Few DReps are experts in even a single domain, hardly any are competent in multiple domains - therefore an expert commission is proposed under [i]. [h] A strategic entity has to be responsible for preparing, proposing and implementing a budget. This entity is appointed by a vote for a fixed term. [i] An expert com…
  references: Other
    label: AtlasHub
    uri: https://cexplorer.io/drep/drep1y2dnsj0taktxwmzwf4a7sp0mg3rvm3jsetag0h0m83khs3c7d3l6x