The basic operation of the committee will be set out in the constitution (often referred to as the ‘governing document’). Depending on the form you organisation takes this could be as simple as a remit or set of rules drawn up by you and agreed (and minuted) at a meeting. Or it could be document approved by a regulatory body like the Charity Commission or Companies House – or both! See FAQ 25 for more on how committees operate in practice.
When drawing up a ‘governing document’, no matter how simple, you should consider addressing the following points;
How members of the decision making body get there (i.e. are they elected, appointed, chosen by lot, etc?)
Defining the purpose of the organisation (including details of who should benefit);
What powers the committee has;
Meetings and proceedings of the committee (how often – how called);
Membership (if any);
Who and how money is dealt with (treasurer? Annual accounts? Report to members? Independent auditor?;
Bank accounts (where money is held);
Power of amendment to this constitution;
Power of dissolution (under what circumstances can you wind up the organisation).
Dealing with conflicts of interest;
if you anticipate becoming large or a registered charity then you might also think about;
Holding of land and investments; (in which case you should think about giving the committee the matching powers – of investment and possible raising a mortgage)
A good constitution will set out clearly how changes are made to it (under powers of amendment). If you are not a registered charity or company then generally it is reasonable to make changes if a majority of members agree. The basic principle is that the more significant the change the larger the majority should be. So a simple change may need a simple majority, a significant change could need a two thirds or three quarters majority. If you are a registered charity or a company and your constitution isn’t clear you will need to refer to the Charity Commission for guidance. Read CC36
first and if still not clear ring the helpline and/or write to them.
Constitution is the generic term for the document that sets out your purpose and how you operate. Lawyers often use the generic term ‘governing document’. An unincorporated association can use any term it likes – though remit or constitution are the commonest. Charities and companies have specific names for their governing documents. A company’s is called The Memorandum and Articles of Association (note however, from 1st October 2009 all the relevant provisions will be in the Articles). A charitable trust’s is called The Trust Deed. An unincorporated charitable association’s is called a Constitution or Rules.