This is the key question that every trustee should be able to answer because everything a trustee does should directly or indirectly further the objects of the charity, and trustees have a legal duty to ensure that all the assets of the charity are used only to achieve the charity’s objects.

A charity’s objects are the purposes for which the charity is established. In most governing documents, the objects are set out toward the beginning of the document. In older trust deeds, there will sometimes be a long introduction before the objects are set out. In those cases, the objects usually appear after the first use of the phrase “to be held in trust for…” or “on trust for…”

The main charitable object of every church should be the advancement of the Christian faith or some variation of that, e.g. the advancement of the faith in accordance with a particular set of doctrines or the practices of a specific denomination or the advancement of the faith within a geographical area. Many church charities will also have other objects such as the relief of poverty or the advancement of education, even though there is an argument that both of those can be pursued by charities that only have the advancement of the Christian faith as their object because the Christian faith itself promotes both of those things.

With churches established as unincorporated organisations, it’s not uncommon for the constitution or rules not to specify any charitable objects, but just deal with matters such as church membership requirements and how to appoint church leaders. However, that shouldn’t lead to the conclusion that the church doesn’t have charitable objects or that it isn’t a charity. Instead, the best analysis will usually be that the church has never written down its charitable objects and needs to take advice on how to write its objects for the first time and/or how to establish a new charity to take over as the main charity for the church.

With Church of England PCCs, it is generally accepted that the main charitable object of each PCC is “promoting in the parish the whole mission of the Church, pastoral, evangelistic, social and ecumenical,” which is set out in s.2(2)(a) of the 1956 Measure.

The objects of a church charity shouldn’t be confused with a mission or vision statement that a church might adopt. Mission and vision statements are important but informal aims that don’t impose legal requirements, whereas charitable objects are legally binding. Therefore, if a church has adopted a mission or vision statement, it’s important to ensure that the mission/vision statement is compatible with its charitable objects.

Another way of asking this question is, what powers does the charity have, e.g. does the charity have power to borrow money, employ staff or buy property? In some cases, the charity won’t have the power to do these things unless its governing document explicitly states that it does. In other cases, the charity may technically have the power to do these things, but it might still come across practical difficulties if the power isn’t written down. If your charity’s governing document doesn’t explicitly name a significant power, you should take advice on whether the charity actually has the power anyway and whether the governing document should be amended to make reference to it. Unless your charity is a CIO, you should assume that the power does not exist unless you have been advised that it does.

If you are used to running a limited company outside of a charity context, you might know the rule that a limited company can do anything an individual person can do even if it’s not mentioned in the company’s constitution (s.39 Companies Act 2006), but that rule doesn’t apply to charitable companies, so in most cases a charitable company won’t have the power to do something unless its constitution says that it does.

CIOs on the other hand, have the power to do anything “calculated to further its purposes” even if it’s not written down in the constitution (unless the constitution prohibits it) (s.216 Charities Act 2011). However, many banks will still refuse to lend to any charity unless its governing document has an explicit power of borrowing.

With PCCs, the 1956 Measure says that PCCs have all the powers that churchwardens and vestries had prior to 1921, which isn’t very enlightening. However, with borrowing, the case of Re St Peter Roydon [1969] 2 All ER 1233, confirmed that this includes the power to borrow money and the 1956 Measure also confirms explicitly that PCCs have power to acquire and dispose of property (which includes the power to mortgage property), though they will often also need the consent of the diocese.

Every charity has charity trustees even if they are not called trustees. Section 177 Charities Act 2011 says charity trustees are “the persons having the general control and management of the administration of a charity.” Charities are not free just to designate certain individuals as charity trustees; the charity trustees will be all the members of the group that controls the administration of the charity.

In limited companies, the charity trustees will be the board of directors (although in some charities the title of “director” is given to senior managers who are not actually company directors).

With CIOs the charity trustees will normally be called charity trustees explicitly.

With trusts, the trust deed will normally refer simply to trustees, and these will be the charity trustees.

With unincorporated associations the terminology can vary significantly. If the governing document refers to a church council, its members will usually be the charity trustees, but in cases where the only references are to elders and deacons, it isn’t always clear which of these groups constitutes the charity trustees. In some cases, it may even be that all the church members are charity trustees in churches where every decision is taken to a members’ meeting.

With PCCs, every member of the PCC is a charity trustee.

Every governing document should have clear rules setting out how individuals are appointed as charity trustees or, if the governing document doesn’t mention charity trustees, to the role that makes them a charity trustee and how they can be removed. What does your charity’s governing document say about this?

You should be able to answer all the following questions from the governing document:

1. Do trustees need to make decisions at meetings or can they use written resolutions?
2. Do video calls count as meetings?
3. How are meetings called?
4. How many trustees need to be at a meeting?
5. How many trustees need to approve a decision for it to be valid?

Limited companies, CIOs and unincorporated associations all have members as well as trustees (but with some companies and CIOs the members and trustees might be exactly the same people). With charitable trusts, you don’t have members of the charity itself, but the trust deed might require the trustees to obtain the approval of the members of the church (the church and the charity being technically distinct).

Where a charity has members, members’ approval is usually needed for decisions to amend the governing document or close down the charity and there are often other decisions that are reserved for members. In charities where the trustees and members are exactly the same group of people, trustees need to ensure that any decisions requiring the approval of members are made by them in their capacity as members and not just as trustees and that any meeting where they are seeking to make decisions in both capacities needs to satisfy the requirements for a trustees’ meeting and a members’ meeting for the decision to be valid.

For charities that are CIOs or limited companies, you can’t just rely on what your governing document says, because there are legal provisions requiring certain decisions to be approved by members, but a well-written governing document will accurately reflect those legal provisions.

Churches that are committed to involving church members in decision-making often unwittingly adopt constitutions that allow all decisions to be taken by the trustees (other than decisions to appoint church officers, amend the governing document, and close the church), but then in practice seek members’ approval where the governing document doesn’t require it. In these cases, the trustees should consider setting out in the governing document itself the type of decisions that will need approval by members.

Charity trustees cannot be employed by the charity of which they are a trustee unless this is specifically permitted by the charity’s governing document. (The only relevant exception to this is for PCCs – see s.7A of the 1956 Measure).

Churches commonly have pastors who are both employees and trustees of the church and so they need to make sure that their governing documents allow for this, otherwise salary payments are likely to be unlawful.

In terms of providing goods or services to the charity (other than under a contract of employment), charity trustees are permitted to do that even if the governing document doesn’t mention it, as long as the arrangement satisfies the conditions in s.185 Charities Act 2011.