Board charter template
A board charter is the document that describes how a board governs. It sets out the board's role and authority, who sits on it, the responsibilities it keeps to itself, the matters it delegates, the committees it relies on, how often and how it meets, and how it works with the chief executive and management. A charter does not replace the constitution or the law, but it gives directors and management a shared, practical understanding of the board's role and the line between governance and day-to-day management.
What the charter is for
The charter aligns the board around its purpose and clarifies who decides what. It reduces the risk of the board straying into management or, conversely, of important decisions being made without board oversight. It supports the induction of new directors, sets expectations for conduct and attendance, and provides a reference point when questions arise about authority or process. Reviewed regularly, it keeps governance practice current as the entity grows and circumstances change.
What to include
A board charter commonly covers:
- Purpose and authority of the board, including its relationship to the constitution and the law. - Role and key responsibilities, such as setting strategy, overseeing risk, approving budgets, and monitoring performance. - Matters reserved to the board, being decisions that cannot be delegated. - Composition, including size, the mix of skills sought, and the roles of chair and any deputy. - Role of the chair and the company secretary. - Delegations to management, including the authority of the chief executive and any financial limits. - Committees, listing each standing committee and referring to its terms of reference. - Meeting cadence and procedure, covering how often the board meets, quorum, notice, and the use of papers. - Decision making, including how resolutions are passed and how conflicts of interest are handled. - Director conduct and expectations, including preparation, attendance, and confidentiality. - Board performance and review, including how the board evaluates its own effectiveness. - Review of the charter itself, stating how often it is reviewed and who approves changes.
How to use it
Adopt the charter by board resolution and give a copy to every director, ideally as part of induction. Use it as the working reference for how the board runs its meetings and makes decisions, and align the committee terms of reference and the management delegations with it so the documents are consistent. Review the charter on a set cycle, for example annually, and after any significant change in the board's size, structure, or circumstances. Record each review and any amendments in the minutes.
Common mistakes
A charter that is copied from a template and never tailored to the entity tends to sit unused. Other common issues include leaving the matters reserved to the board undefined, so the boundary with management is unclear; failing to align the charter with the committee terms of reference and management delegations; and adopting a charter once and never reviewing it. Some boards also omit practical detail on quorum, conflicts, and decision making, which is precisely the detail directors need when a difficult situation arises.
How Quorum helps
Cohiva Quorum stores your board charter alongside the resolution that adopted it and the related committee terms of reference and delegations, so the governance framework stays consistent and easy to find. It supports scheduled reviews and records amendments against the board's decisions. Quorum helps you comply and supports your obligations; the entity and its officers remain responsible for compliance.
Part of the Cohiva platform
Cohiva Quorum is part of the Cohiva platform at https://www.cohiva.com. When an adopted charter or a director acknowledgement needs signing, you can route it through Cohiva Sign for e-signatures so the signed document flows back into the minute book.