What is a constitution?

A constitution is a written document that describes the purpose and structure of your organisation and sets down rules about how it is to be governed. The form this document takes and the name by which it is known will vary depending upon the legal structure of your organisation. A constitution my also be more generally known as the governing document.

Do we need to have a written constitution?

Anyone can set up a voluntary organisation or social enterprise. For the smallest informal groups that come together there is no requirement for a written document. There may be a verbal understanding about the ‘rules’ of the group, which may change from time to time. However, the dangers of operating on the basis of unwritten assumptions soon become apparent when disagreements arise.

As a group grows larger and seeks public recognition and funding the need to write down the rules becomes necessary. Few, if any, funding bodies will give even small sums of money to groups with no written statement of their purpose and structure. A written constitution is essential for organisations seeking to register as a charity or choose to structure themselves as a company or CBS. A formal structure provides a framework and gives your group an identity, continuity, credibility and a means of establishing common objectives

Is a constitution a legal document?

Yes, a constitution is a form of contract. It sets out the rights and obligations of the members of your organisation in relation to each other. It defines the purpose for which the organisation has been created and the powers it may exercise to achieve this purpose. It also identifies the governing body of your organisation; that is the group of people who have responsibility for managing the organisation, e.g. a management committee or board. It will explain how the governing body is appointed and what its obligations are to the organisation and its members.

A constitution is a legal contract, enforceable in court. When someone joins your organisation, they agree to follow its rules. For charities, the constitution also creates a trust among three groups: the funders or donors, the governing body (the charity trustees), and the beneficiaries. Actions beyond the organisation's purposes or powers can be described as a breach of this trust.

Writing your constitution

Organisations can write their own constitutions. There are plenty of sources of advice available and there are standard template or ‘model’ constitutions which you can use as a starting point and adapt to suit your own needs as an organisation. However, unless you have experience of writing such documents it is advisable to at least have it checked by someone who has. Problems with constitutions often only come to light when something goes wrong. If the constitution contradicts itself, is vague or does not provide an answer, then it will have failed in one of its principal functions. People with wide experience of voluntary organisations are able to anticipate the kind of problems that might arise and can ensure that the constitution is adequate to deal with them when they do.

For more formal organisations the constitution may be a lengthy document. If it is to be a SCIO or company the content is largely prescribed by charity law and/or company law. In such cases working with a knowledgeable advisor or a lawyer or someone experienced in company formation is advisable. Your local Third Sector Interface (TSI) which can be found at the directory page here can help.

Information on the differnet types of constitution and chosing the right one is available here.

What sort of language should the constitution use?

If the constitution is written in plain, simple language it is much more likely to be used. The constitution is an ‘instruction book’ explaining how the organisation is to be properly governed. There is not much point in a book of instructions that nobody understands! Very old constitutions were usually written by lawyers; they are full of obscure and archaic words, technical terms, sometimes in Latin or French. There is absolutely no reason at all why this should be the case.

That said, careful wording is important. The constitution should reflect the level of formality of your organisation. It needs to strike the right balance between being reasonably comprehensive without being overly long; between being clear and precise without being unduly restrictive and inflexible.

When should we write the constitution?

Most organisations tend to write their constitutions at an early stage of their development, as those with any real ambition will soon look to secure funding or gain some level of public recognition.

In organisations that have existed informally for a while the ‘rules’ are often arrived at naturally. The constitution, when eventually written down, reflects what has actually been happening in practice (assuming this to have been good!).

There are two main difficulties with constitutions written at the outset of an organisation’s life. Firstly, the founder members probably get on fairly well and agree about most things. It can be hard to envisage a situation in the future where this may not be the case. The need for more formal rules may therefore not be anticipated or understood. Secondly, the constitution should reflect not just what your organisation is now, but what it will become in the future. If you have plans for a large membership or a wide range of activities, the constitution needs to be comprehensive enough to cope with these complexities as they develop.

Adopting the constitution

To begin with your constitution will be in a draft form. It may go through a number of drafts until the founder members are happy with it.

What happens next, once drafting is completed to everyone’s satisfaction, will depend upon the type of document.

• A constitution needs to be adopted; that is, approved at an inaugural meeting of the founder members. The first office-bearers are authorised to sign and date the document on behalf of the organisation. This is called a certified copy. Minutes of this meeting should also be recorded.

• Articles of association should be signed by each of the subscribers - that is, the first members of the company - and countersigned and dated by a witness. It must then be submitted to Companies House.

• A trust deed needs to be executed; that is, signed by each of the trustees in the presence of a witness and dated. Charitable trust deeds do not incur stamp duty and do not need to be certified by the stamp office.

Regardless of which legal structure is used, an organisation seeking charity registration must apply to OSCR, enclosing a copy of the constitution and other supporting evidence, which is normally a covering email and description of the work to be carried out by the charity described through their application process and forms. The online process brings together all the elements in one exercise.

Reviewing and changing your constitution

A well-written constitution must include provision for making amendments. The members of a limited company have a statutory right to amend their articles and the procedure is laid down in law. Any written description in the articles of association must follow these rules. SCIOs constitutions are required to have clauses enabling changes for them to be compliant on application for registration to OSCR.

The constitution is designed to provide permanence and continuity to your organisation. Individual members will come and go, but the purposes for which the organisation was established remain valid and unchanged. The constitution should not be changed lightly. Normally a proposal to make changes requires a substantial majority of members to vote in favour at a general meeting. If the constitution does not specify the required majority then the legal default applies which is all the members (that is, a unanimous vote).

In the case of a limited company, the requirement is to pass a special resolution at a general meeting of which not less than three weeks notice has been given. A special resolution requires a three-quarters majority voting in favour.

If your organisation is a charity you are restricted from amending certain clauses without prior written consent from OSCR. You cannot change the charity's name or purposes or any other provision that may affect its charitable status without OSCR’s permission.

It is important to think about how and when you review your constitution. Good practice suggests that this should be a regular exercise to make sure that it’s still meeting your needs and is up to date with any changes in regulations. A sensible approach might be for a small group of committee or board members to take some time to look properly at the constitution every three years, but update it more regularly if the board or membership ask for changes.

Further resources and links

For further free, well-informed information, find your local Third Sector Interface (TSI) at the directory page here