The importance of charitable status and a Royal Charter

Jon PrichardDear colleagues,

There has been some discussion on social media around the threat posed to IChemE’s charitable status and Royal Charter by the no-confidence motion that will be considered at the Extraordinary General Meeting (EGM), which will be held in London on 11 January 2018. I therefore thought it would be helpful for me to post this note to provide further clarification. The first thing to highlight is that all EGM documentation, including the supporting statements, was passed and cleared by IChemE’s lawyers before it was approved by our governing Council.

It should also be noted that under the Charities Act, responsibility to assess and mitigate the risks faced by the Institution lies solely with the trustees. The trustees (Council) have done this and have concluded that, if passed, the wording of Motion 2 introduces an immediate risk to our charitable status. This is because member benefit must be clearly stated as incidental to public benefit (Charity Commission Guidance Document CC3 Nov 16, Section 6.1). Members interests should align with the delivery of public benefit, but must not determine it.

Some of the proposers of Motion 2 have questioned the benefits of retaining our charitable status from the outset. The UK Government’s view is that if the activity you undertake looks to be charitable, then you must register as a charity.

Additionally, the wording in point three of Motion 2’s supporting statement (relating to an ongoing disciplinary matter) introduces a risk to our Royal Charter, and has no place in an EGM motion. It is reasonable for Council to conclude that this statement was only included to disrupt the disciplinary process, particularly as this has been inferred by some of the signatories on social media, prior to the calling of an EGM. It should also be noted that the mover and his supporting signatories have not subsequently provided any other justification for including this statement.

IChemE is obliged to regulate the chemical engineering profession. If we do not, then we will be sanctioned by the Engineering Council, and ultimately the Privy Council. If, as a result of Motion 2 being passed, the disciplinary process was disrupted, then the Institution would have to self-report a failure to regulate to the Engineering Council and the Privy Council. [Note: The Engineering Council acts as an official advisor to the Privy Council on matters relating to the engineering profession].

Those bodies would then be likely to sanction IChemE. This could include the suspension of our licence to award Chartered Engineer status. IChemE would then be required to take specific action to restore this licence. If we failed to carry out the requested actions (and thereby carry out our regulatory function and act in the public interest), then we would be placing our right to hold a Royal Charter in jeopardy. This is not an immediate threat, but one that would arise if the disciplinary process was disrupted.

The Institution’s Disciplinary Regulations - which are being fully complied with - are wholly consistent with those used by professional bodies across the world. Once Council has appointed a Disciplinary Panel, then it has no further influence on the conduct of proceedings, which are rightly independent.

It is also worth noting the differences between the requirements of the Royal Charter and those of maintaining charitable status. These are summarised as:

  • Acting in the public interest is a key requirement for holding a Royal Charter. The Charter empowers us to act as a regulator for the chemical engineering profession.
  • Delivering public benefit is a legal requirement to maintain charitable status. We do this as an educational charity by providing professional development and related qualifications for chemical engineers.

 

The receipt of the no-confidence motion came as something of a surprise to Council. No constructive attempts had been made by the mover or his supporters to raise concerns via the normal channels. No communications were received by myself, or the President, nor were any meeting requests made. Few, if any, questions to the Institution’s Annual Report and Accounts have been raised at our Annual General Meetings in recent years.

Council acknowledged the need for modernisation of IChemE’s governance and business planning in 2016. Our new strategy and governance review, which will be discussed at the 2018 Annual General Meeting, are key components of that modernisation process. Support for Motion 1 provides a meaningful and constructive opportunity for members to endorse this direction of travel and confirm their support for IChemE’s volunteer leadership.


  1. Extraordinary General Meeting, 11 January 2018 – Implications of Motion 2

 

My IChemE

IChemE is a registered charity in England & Wales (214379), and a charity registered in Scotland (SC 039661).