Once you have decided on your legal structure and are ready to draft your constitution you may find it helpful to base it on one of the models that we have developed.
The material here should enable you to draft, adjust and finalise your constitution and form your voluntary organisation.
There will be some organisations which demand specialised provisions in their constitution and there are some circumstances where legal advice will be helpful. Note that there are only a limited number of solicitors in Scotland who deal regularly with the drafting of legal structures for charitable/voluntary sector bodies. The Law Society of Scotland has a list of legal firms with specialist charitable experience.
If you are a member of SCVO with an income of less than £500,000, then you can get legal advice and help with drafting your constitution from our Free Legal Advice Service.
Find the right model constitution
For each type of legal structure commonly found in the voluntary sector in Scotland we have provided a model constitution, plus detailed clause-by-clause notes and optional additional clauses.
While it may be tempting to simply take the model and fill in the blanks relating to your organisation, you may then find you end up with a document which does not work for you, since every organisation has its own priorities and approach.
If you are using our model constitutions to apply to OSCR for charitable status then you need to complete certain sections in full. OSCR have to know what are your charitable objectives and activities, the number of trustees you need for a quorum, whether there are any qualifications to be a member of your organisation, etc. We have highlighted (in yellow) the sections in each model that you must complete in order to gain charitable status so that you can ensure your constitution contains all the information that OSCR will be looking for when they consider whether your organisation can become a Scottish charity.
Think it through: it is important that everyone in the steering group should think carefully about the features in the constitution – so that it is a real reflection of what people want to achieve, in relation to the structure for the organisation.
A Scottish Charitable Incorporated Organisation is a legal structure developed especially for charities in Scotland. Find out how to write a constitution for a SCIO.
While a voluntary or unincorporated association is a simple legal form, it still requires a constitution. Find help and resources here to write a constitution for a voluntary association.
A company limited by guarantee can be used as a legal structure both for charities and for other not for profit organisations. Find out how to write a constitution for a company limited by guarantee.
To set up a trust you will need to prepare a trust deed. Our model trust deeds, notes and guidance can help you write a trust deed.
Other things to think about
Each of our models contain a lot of material. Before you start there are a number of common issues that you need to think about, whatever legal structure you choose.
The name of your organisation
Check with SCVO, OSCR, Companies House and also your local Third Sector Interface whether there is some other organisation which operates under a similar name. In terms of general legal principles, the other organisation could, in those circumstances, raise a court action against the new organisation on the grounds of ‘passing-off’, ie on the basis that the public were being misled.
If there is an organisation with a similar name, but you think that they are unlikely to object, then it’s best to get a letter from them to that effect, just in case a different view is taken in the future if new people come onto the board of that other body.
Under charity law, OSCR will refuse to register a charity if it considers that the name is:
- the same as or too similar to another charity
- likely to mislead the public as to the true nature of the organisation
- likely to give the impression that the organisation is connected to Scottish or UK government or local authorities, when in fact it is not
You should not use the word ‘Limited’ in the name of a voluntary association or trust – doing so, if the body does not have limited liability, is a criminal offence.
There are certain important considerations when choosing a suitable name for a voluntary sector company. For more information on this see Company limited by guarantee.
The objects of your organisation
The constitution should set out clearly the main objects of your organisation. If applying for charitable status, then your objects will have to incorporate terminology from the list of charitable purposes set out in section 7 of the Charities and Trustee Investment (Scotland) Act 2005. There will also be a need to show OSCR that the ‘public benefit test’ is satisfied. More detailed guidance on this is available from OSCR.
Whether or not charitable status is being pursued, the objects clause has two main aspects. It guides future boards in relation to the range of activities which the organisation should pursue, and it identifies for those dealing with the organisation what the organisation is set up to do. This could include people considering whether to join as members, and importantly, bodies which are considering if they will provide funding.
Look at the objects clauses of other bodies operating in a similar field if you need some guidance, but remember that it is very important that the wording which is used in your constitution does accurately reflect the aims and activities which your organisation will be pursuing in practice.
The composition of your management committee
The role of your management committee or board is to control and supervise the activities of your organisation. Your board will meet on a regular basis, most commonly once a month, to receive reports from individual trustees and/or members of staff, discuss important issues, plan for the future, and importantly, monitor the financial position of your organisation. Some careful thought should be given to the composition of the board.
The maximum number of board members should be set at a level which allows for an appropriate level of representation, but should not be set so high that effective decision-making becomes difficult.
Usually at any general meeting of a two-tier membership organisation (eg a SCIO, a voluntary association, or company limited by guarantee) any member can put themselves forward for election as a board member. Similarly existing board members must put themselves forward for re-election by the members, either annually or perhaps at intervals of three years. The idea here is that although the members cannot, for practical reasons, all contribute directly to decision making at board level, they should have input into the question of who should be taking such decisions.
There is often a separate category of board members who are not elected by the membership but are co-opted by the other members of the board on the basis that they have special expertise, or represent outside bodies. If the board decides that a co-option should be made then you should decide whether or not they should have a vote on the board, and include the appropriate provisions in your constitution.
In any two-tier structure, you should consider whether all members of the board retire from office each year, and are then eligible for re-election. This allows the maximum opportunity for new people to come onto the board. However, this does bring the risk of a loss of continuity. If that is a concern, then the constitution can be changed so that only a proportion of the board retire from office each year. The most common arrangement would be for this to be set at one-third of the board. If any board members were co-opted they would all retire each year.
Even if members are willing to re-elect someone as a board member, you may want to include a clause in the constitution that would debar a board member from serving for too long so as to ensure that “new blood” is introduced from time to time. This is covered in the additional clauses section of our models.
And finally, have you thought about…?
It is always possible to set out some of the more detailed provisions (so long as they are not in conflict with what is set out in the constitution itself) in the form of standing orders or policy statements eg detailed voting procedures and conflict-of-interest rules. It should be recognised, though, that setting out provisions in documents which are separate from the main constitution can make them less accessible.
The constitution can be changed at any time, providing the appropriate resolution is passed at a meeting of the members (though it should be noted that any change to a charitable body’s objects or purposes will require OSCR’s prior consent). So you could start off your voluntary organisation with a very simple form of constitution, and then build in further material (eg. provision for a membership subscription or more detailed categories in relation to the people serving on the management committee), at a later stage.
Should outside organisations vet your constitution?
In many cases, it will be a condition of funding for a project that the prospective funding body approves the terms of the constitution. It’s important that you establish at an early stage what sort of features would be acceptable or unacceptable to them, eg some funders require that the constitution states that where two signatures of board members are required they should be unrelated and not live at the same address. If your organisation is to be affiliated to a larger body then you should check what would be acceptable to them.
A seat on the board?
If there are outside organisations with which you will have close contact in carrying out your activities, again it would be sensible to bring them into the process at an appropriate point, and possibly reserve a seat on the board for people nominated by a key partner body.
The wider community
In practice, most steering groups consist of a relatively small number of people, and there is no legal requirement to involve the wider community. However, from a practical point of view, if an organisation is intended to represent a particular community it would be advisable to establish the legitimacy of the organisation and its board, by having some sort of wider consultation at an appropriate stage. Again many prospective funding bodies will require evidence of the need for a particular project, and details of wider consultations could provide valuable evidence to support a funding application.
Rather than work with our general models you may find that there is already a model constitution specific to your sector available from a regional or Scottish umbrella organisation, or relevant support agency, which you could adopt. Further help may also be available from your local Third Sector Interface.