It’s vital that academy trusts are appropriately governed, and one of the most basic, and crucial aspects of good governance is to have appropriate articles of association. There are a number of reasons for an academy trust to update its articles. For example, it may be that a multi-academy trust is expanding, or the current articles of a single academy trust are out of date and no longer reflect best practice in accordance with the Department for Education’s (DfE) guidance.
Whatever the reason for updating the articles, the academy trust needs to ensure that appropriate steps are followed in doing so.
Key considerations when updating your articles of association
When reviewing the articles of association, the trustees should ask certain questions to understand whether the articles remain appropriate. Some of the matters which should be considered include:
- Is the academy trust meeting its objectives, or working outside the scope of its objects or powers?
- Are the articles inhibiting the way the trustees govern the academy trust?
- Is the academy trust’s governance framework compliant with DfE guidance?
A range of people will be interested in the suggested amendments to the articles, and the academy trust should tailor messages for each stakeholder group. A simple FAQ format can be helpful in articulating why the changes are required and the intended benefits.
Changes to the articles will require the approval of the academy trust’s members. The DfE will also be involved in approving the changes, and will have veto power over of any of the proposals. The academy trust should therefore engage the DfE at the earliest opportunity to ensure they are happy with the proposals.
Once the resolution has been passed, notification should be provided to the DfE and the new articles of association must be sent to Companies House. You should also ensure that a copy of the revised articles are published on the academy trust’s website.
When considering governance of your academy trust, as well as reviewing the articles of association, an external governance review should be conducted. This is a key tool for identifying issues and ensuring that you are compliant with the DfE’s legal requirements. A governance review is also likely to flag processes to be praised and built upon.
When updating your articles, you should check whether the articles give the members power to amend. If so, what is the extent of those powers? Are the members suitably independent from the trustees?
The DfE expects academy trusts to review their articles regularly, and amend them as necessary, to ensure that the governance framework of the academy trust allows the trustees to respond to the opportunities and challenges facing the organisation, and to ensure that oversight and accountability is robust and effective.
When revising your academy trust’s articles of association, you should ensure they are well drafted to adequately anticipate future potential changes and incorporate clauses to accommodate and meet those developments. It’s good practice to review the articles and other key governance documents regularly. Our Education team are well versed in supporting academy trusts to review and update their articles, and ensure that they properly incorporate the DfE’s requirements.