A common query we get at Chester Voluntary Action is ‘Do we need to update our constitution?’ This is often prompted by a change in board make-up and the sudden discovery of a dusty old document that was penned in the 1970s.
While there have been many Acts passed since this time that may affect the content of your governing document (the Charities Act 2016 and Equalities Act 2010 being the most noteworthy) as well as newer legal structures such as CIOs and CICs, it is likely that the main information within is still fit for purpose.
Unless the aims and objects of your charity has changed then it is probable that there isn’t much to do but here are a few pointers to see if there are any ways you can refresh your constitution or governing document:
1. How to make changes to the document
Before you do anything, is it clear about the steps needed to change any sections? Do you just need board agreement at an informal meeting, or do you need a member vote at an AGM? There should be a section in the document with instructions on this. You’ll also have to have these changes approved by the Charity Commission
2. Allocation of surplus
While you may be nonprofit, there may be times when you do get extra income and some funders might like to see what happens in such instances. For many of our members it may simply just be a statement stating it will be reinvested to further the charity’s objects.
3. Updating the committee
As well as refreshing the governing document, how about looking at the process of making changes to your board? Is the process straightforward? Do you have a system where trustees must step down after a certain period? Can they be reappointed? While it can still be difficult to find trustees, new faces can bring new ideas and new approaches.
4. Who are the ‘members’?
In a CIC the members might also be the directors. If you are a Company Limited by Guarantee then your members might be defined by the update in the Companies Act 2006. It can be confusing, especially if you use this term elsewhere (e.g ‘board committee members’). Check your document for confusing sections or conflicts.
There is a guide to writing governing documents at NCVO as well as a list of model documents and constitutions found at the Gov.uk website but if you need support we are always happy to look over documents and make suggestions.