Some people find the subject of "legal structures" rather off-putting, but it is an essential element in creating and sustaining a successful organisation. An organisation's choice of structure will influence a number of important factors: the personal liabilities of board or committee members, fundraising, the capacity to trade and to borrow money, and governance arrangements (i.e. how decisions are taken within the organisation).

An organisation will usually take particular interest in its legal structure when it is first setting up, and then when it finds itself in changing circumstances, perhaps as a result of growth, new funding patterns, merger or otherwise.

When seeking to identify the most appropriate legal structure for an organisation, we are essentially trying to answer two questions:

What are the key characteristics this organisation wishes to have? For example:
•  Core purpose and values
•  Membership - i.e. exactly who is to own the organisation?
•  Accountability and internal democracy
•  Decision-making and governance
•  What it may do with income, assets and profits

Quite apart from anything else, discussing these fundamental issues is a useful and constructve exercise for any group of people, whether in a start-up situation or well-established.

What is the most appropriate form of legal status for this organisation? Most in our sector will choose between:
•  Company limited by guarantee
•  Community Interest Company (limited by shares or by guarantee)
•  Charitable company
•  Industrial & Provident Society (community benefit society or co-operative)
•  Unincorporated association
•  Simple trust

Each has its advantages and disadvantages, and one option is likely to be the most suitable for a given situation.

Once we have identified the answers to the above two questions, my job is to put all these various characteristics and provisions together into a single document that will lay down the basic rules for the organisation - the constitution, or governing document, and then make sure this document is properly adopted and, if necessary, filed with one or more regulatory bodies.

CHOOSING A LEGAL STRUCTURE
The process of selecting the most appropriate legal structure will vary to some extent, depending on the nature and size of the organisation and where it is starting from. I have a range of tools and techniques to help with this process, so please do not hesitate to get in touch - whether you know just what you want or are completely new to the subject.

Feedback from clients over many years indicates that I can make this whole process painless and possibly even rather interesting!