Registering a charity: Getting it right – drafting charitable purposes

As explained in a previous article, a ‘purpose’ is what an organisation is set up to achieve. To be a charity, an organisation’s purpose or purposes must be exclusively charitable, falling within one of the thirteen descriptions of purposes in the Charities Act 2011, and be for the public benefit.

An organisation’s purpose is set out in the objects clause of its governing document and the ‘objects’ should clearly state the charitable purpose. All charity governing documents must contain an objects clause, regardless of its structure.

The Commission has published guidance on how to write charitable purposes and we strongly recommend that applicants consult this when drafting their organisation’s purposes. We also recommend that applicants consult our example charitable objects as you may find ‘ready-made’ charitable purposes that are an accurate fit for your organisation or be able to adapt these to meet your individual requirements.

There are several benefits to drafting objects that are exclusively charitable and that provide a clear and accurate description of the organisation’s aims. For example:

• allowing the Commission to make a much quicker registration decision
• helping the public to understand what your organisation does and how it does it when consulting the public register. This could assist with support and donations.
• assisting the trustees in understanding the limits and scope of what the charity can do. Trustees must make decisions and run the charity in a way that is consistent with its purposes and they cannot, under any circumstances, act outside of its purposes. Clear and accurate charitable purposes make this task easier.

A clear charitable purpose can be broken down into four key sections:

• what outcomes your charity is set up to achieve
• how it will achieve these outcomes
• who will benefit from these outcomes
• where the benefit will extend to

‘What’ refers to the purpose – for example, the advancement of education, the relief of poverty, the promotion of equality and diversity, or the conservation protection and improvement of the natural environment.

‘How’ relates to the way in which a purpose will be achieved – for example, the provision of GCSE textbooks, the provision of a foodbank, conducting research on issues relating to equality and diversity, or the conservation of a particular species of animal.

‘Who’ covers the people who will benefit from the purpose being achieved – for example, students studying GCSEs, individuals and families who are in financial difficulties, or the general public.

‘Where’ should define the area in which the benefits will extend – for example, a particular school, an area of a city or town, or any part of the world.

Not every purpose will necessarily require all four elements but, using this formula and the examples referenced above, here are some charitable purposes:

‘To advance the education (what) of students in Birmingham schools (who and where) by the provision of GCSE history textbooks (how).’

‘The relief of poverty (what) in Aston and the surrounding areas (where) by the provision of emergency food, essential toiletries and household items distributed via a foodbank (how) to individuals and families in need (who).’

‘The promotion of equality and diversity (what) in the United Kingdom (where) for the benefit of the public (who) by conducting or commissioning research on equality and diversity issues and publishing the results to the public (how).’

‘For the benefit of the public (who), the advancement of the conservation (what) of species of wildlife which are in danger of extinction, in particular the Amur Leopard, by making grants to support conservation programmes established for their protection (how) in their native territories in Russia and China (where).’

• Be precise and clear – use plain and simple language and avoid vague or ambiguous terms
• If no beneficiaries are specified, it is assumed that the purpose is intended to benefit the public in general
• If your objects are unclear, the Commission can look at the relevant information provided in the application form to establish what the purposes may be. This is why we recommend providing full and detailed responses to the questions in the application form.
• The framing of the objects is a matter for the trustees. The Commission may suggest objects for the trustees’ consideration when handling your application but the responsibility for deciding whether the objects are accurate and reflective of the organisation’s scope is ultimately for the trustees to decide and confirm.
• Purposes of organisations that are registered charities cannot necessarily be taken as precedent. The Commission assesses each application on its own merits.
• General charitable purposes (i.e. ‘to further such exclusively charitable purposes according to the laws of England and Wales’) will need to be explained. These purposes are common in grant-making charities where the scope of grant making is wide but, if the organisation has a specific purpose, this should be stated.
• When assessing a purpose, we consider the scope of the purpose – that means not only what has been and is being done but also what could be done under the purpose. If objects include purposes that are not charitable, then the organisation is not a charity and cannot be registered.
• If your purpose contains a term that is technical or may not be easily or widely understood by the general public (like ‘global catastrophic risk’ or ‘critical management studies’) or has more than one meaning (like ‘sustainable development’), then a summary or definition of that term will be helpful

Next time, we’ll look at personal benefit in more detail, including financial and non-financial benefits, benefits to trustees, members, funders and commercial organisations.