Changing your governing document

Governing documents need to be periodically reviewed with professional help both to ensure they are still suitable for the organisation and to ensure that they are legally up to date.

For example, the procedures for electing or appointing trustees might feel unwieldy; or the objects of the charity might no longer reflect the new environment in which the charity operates. Alternatively the law affecting the charity may change. For example, the Companies Act changed the rules on management of conflicts of duties, necessitating updating.

If trustees wish to amend the charity’s governing document, they must follow the procedures set out in the governing document and follow legal requirements:

• Governing documents of trusts and unincorporated charities usually include a power to amend the governing document. This must be followed. If there is no power of amendment, unincorporated associations must obtain the unanimous consent or acquiescence of all members to change or the trustees must apply to the Charity Commission for a scheme (this is easier for very small charities). 
• Trustees of trusts can apply to the Commission.
• Companies Limited by Guarantee have a statutory power of amendment in the Companies Act, so there may not be an amendment clause in a company’s governing document
  Some changes require prior written approval from the Charity Commission – in particular, for any change to the objects clause or any
• provisions that give benefits to trustees or change the distribution of assets on wind-up
• Membership charities usually need to gain approval for any proposed change to the governing document from members at a general meeting
• The Charity Commission, Companies House (for charitable companies), and for IPSs the FSA must be informed of any change to the governing document. The Companies Act has recently introduced new requirements in this respect.

Amending a governing document can be a complex matter. Further guidance is available from the Charity Commission.