I think I've made clear on the CIS talk page what the process for the CIS transition was, as best as I am able. Since neither Asaf or I were directly involved at the start, it is difficult for us to give the community details we do not know.
The so-called Conflict of Interest issue has been addressed by the Board here,  making it clear that they do not believe that there is any CoI involved.
If it helps further, I'm happy to quote from my email correspondence with you in February:
I'd also like to clarify that I am not 'associated' with CIS in any problematic fashion - I have no CoI and never have had one. I have known Sunil from when I was 21 years old because we worked in the same rural development NGO - 'Samuha' - he worked on the tech side of things in Bangalore, and I was working on livelihood and women's leadership in north Karnataka. We have naturally continued to know each other because of our common interests in social justice and tech issues in Bangalore and beyond. And the grant to CIS was discussed and finalised by Barry before I joined WMF in July 2012; I had nothing to do with that process and did not even know it was happening till I came on board. I hope that clarifies the situation and makes clear why the Board said what it did. I'm happy to respond to any questions about this or anything else.
Let me just say that simply knowing someone does not constitute 'conflict of interest' - what is important is to establish that there is no undue influence by and benefit to the 'conflicted person' (a somewhat amusing phrase of legalese) by this situation. Since neither is true, please be assured that there is no CoI whatsoever. I'd also like to point out that our community loses energy and focus by not recognising perceived or actual CoI when it exists, while assuming it exists in situations where it does not. I know it can be confusing, and we've made a start to explore it together at the Wikimedia conference. Asaf and Stephen led a session there, which we hope to expand into guidelines for the community soon.
I hope this helps,