Citylife / Business Link / George Ruddock
Instantly recommends CLG. Doesn't think CICs are that good in our situation:
- CICs were created to make it possible for social enterprises to attract investment
- Uniquely for a CIC, a not-for-profit has a way of rewarding investors (35% can go back to investors)
- We don't think this is useful for us, as we're not really trying to attract investors
Grant bodies do NOT typically give to CICs in his experience, a lot of them require charitable status.
CLG is 'tried and tested' for this sector
Note that for this sector, 40 - 60k salary for CEO is standard range. Much more would be anomalous.
New charity commission laws require £5000 in a bank account to set up as charity
- it will clearly be necessary to be a CLG first, then open bank account, then file as charity
STRONGLY recommends having an advisory 'committee not a board - don't list advisors in articles of association - they are advisors.
Trustees of a charity aren't allowed to be paid. That's fine for us for now. If a director does deserve payment they can step down from trustees.
Trustees can also not be paid for work they do for the Charity. There are some points to be clarified with charity commission about this!
Time frames: Community-experts (£130 to set up CLG) are familiar with process. Could do ourselves for £20, but not as likely to be accepted as charity
--- Strongly recommended separating out the society from the company! Suggested executive committee should be societal and directors part of CLG, with overlap.
--- CLG is, itself, an asset locked body.
Phone numbers - charity comission: 08453000218 (0151 703 1797) Companies house 03031234500
Would be fine to be JUST a CLG, many social enterprises are. CLGs with charitable status can trade.
He called charity commission. Restrictions added by charitable status
- protect assets in wind-up - assets more carefully protected.
REMAINING QUESTIONS over trustee, director overlap.
Note that a CLG w. charitable status has two sets of laws to worry about - charity law and company law
--> talk to some lawyers (meeting arranged with Taylor Vinters now)
Directors - recommended initially just those actually running the organisation - perhaps a couple more. Easy to add and remove once set up, harder to set up with lots of directors.
Trustees aren't required until the charity set up.