Legal Structure – where to begin?

Blank Cheque currently exists as an Unincorporated Association.  This means that Laura Asare and I are just two people with a shared goal, acting together to deliver work.  We are not required to register with HMRC, Companies House or with the Charity Commission, we work as we see fit (and make sure to pay our individual taxes!)  The benefit of this is that we are only accountable to our participants, our partner(s) (most recently, Hibiscus Initiatives), our funders (Arts Council England), and ourselves.  The drawback is that without a constitution and a legal framework, we are excluded from most funding sources: grants from Trusts & Foundations, Public Funding, income from trading, commissions, and investment – and we can’t get a bank account.  (Up to now, Arts Council England have provided funds to me as an individual artist, not to Blank Cheque as an organisation).

My research project involves identifying the best legal framework for Blank Cheque and other companies like us, and it’s complicated to shift from one to another, so we’re not jumping into anything just yet.  I’d first like to explore what we wish the ideal framework could be – even if it doesn’t exist yet.  Here are some ideas:

• Low admin – we don’t want to be bogged down with onerous reporting and administration that requires time and resource we don’t have, and which draws us away from delivering our work and making the impact that we seek to achieve

• Ensuring our members and/or participants are intrinsic to design and delivery but also ensuring Laura and I are able to hold director roles and be paid for our work (moving away from the ‘side hustle’ model!)

• Income options – we want to have all income sources available to us so that we can choose the best way to sustain ourselves, which may change as years (and government policies) go on - this incudes funding and having the option to generate income through the services we provide (trading)

• A Board of Advisors rather than a Board of Trustees – a group of people we can reach out to regularly so that we are always taking a human-centred approach but who are not financially liable for Blank Cheque. 

• A framework that enables us to access tax benefits as a result of making positive social and environmental change through our work

As much as Laura and I are ambitious for Blank Cheque, we also don’t want to bite off more than we can chew, so we want a framework that suits our small size and level of operation.

Gov.uk offers the following options for those wishing to set up a social enterprise, which they define as ‘a business that helps people or communities’:

• Unincorporated Association - a type of charity, usually for voluntary community groups, does not need to register

• Business Partnership - partners share profits and losses

• Sole Trader – a self-employed individual

• C.I.C. – Community Interest Company (benefits the community vs private shareholders)

• C.I.O. – Charitable Incorporated Organisation (in the same family as a Registered Charity)

• Limited Company by shares (profit-making) or by guarantee (non-profit) – the company is legally separate from the people who run it

• Cooperative – the business is run by member-owners who each have a voice and a vote for all decisions

Each of these frameworks has their advantages and disadvantages, which is why learning about them in-depth is worthwhile (it’s too much for me to detail in this blog entry, but I will elaborate pros & cons in future!)

A key part of my research is to now learn what decisions other theatres of social change have made about their legal frameworks, what the framework does to support their work, and where it’s less helpful.  I’m in the early stages of developing a semi-structured interview protocol and look forward to speaking with some of my peers on the issue.  Meanwhile, I know there are a few things Blank Cheque can do to get ready for legal status:

• Be 100% clear on our mission, vision, and social objectives

• Write a constitution – a governing document about what we do, why, and how we operate

• Develop company policies – safeguarding, confidentiality, codes of conduct (to name a few)

• Undertake professional development and training – including trauma-informed, best practice, and sector knowledge

• Explore and identify the ethics of our work so we know what kind of partners we want to collaborate with, what bank we want to open with, and what kind of money we’ll accept (e.g. social impact investment?)

• Network with funders, policy-makers, community networks, artists, and women’s centres

• Continue making and sharing work

• Support our peers in the sector

For those out there with grass-roots social change companies, I hope this blog entry helps to start simplifying a daunting process - please do reach out if you want to put heads together.

PS: Just today I took part in a session with Social Enterprise UK who helpfully pointed me in the direction of more useful resources.  Do have a look – there are some variations on the frameworks I’ve listed above: 

Good Finance: Legal Structures for Social Enterprises

School for Social Entrepreneurs: Selecting a Legal Structure

Hello Social Enterprise!

Hello and welcome to Blank Cheque's website where you can get a sense of the work we do, why we do it, and who our participants are. 

I'm Bethany, one of the Co-founders, and through my and Laura’s work with marginalised and criminalised women, I have seen first-hand the impact that drama-based creative practice can have on building a sense of community, on feeling a sense of empowerment, on developing a voice, and ultimately on mental health & wellbeing.  The frustrating thing is that to bring these creative opportunities to our women, we need access to funding.  Securing it can be hugely onerous and time consuming, it can block our momentum, and it can make our work feel unstable.

But I feel like there’s a better way for theatre-makers who have a social change agenda to access the money they (we) need, and I plan on taking a deep-dive into literature, practice, and current knowledge and theories to find some answers.  This quest is what shapes my postgraduate research at Newcastle University (generously funded by the Northern Bridge Consortium), a five-year journey on which I hope you will join me via this blog.  The forthcoming entries will act as a vehicle for me to process my research, look at where gaps are, and begin to bring into focus some strategies for others like Blank Cheque.

Social Enterprise

There’s a term I like which has gained popularity over the past few years, thanks to organisations like Big Society Capital.  The term is Social Enterprise.  Social enterprises have been around for a while (since the 70’s in fact) but more recently, with funding models such as social impact investment, the term has become more familiar.  But what exactly is a social enterprise?  It’s not a formal legal structure in the UK; charities, non-profits, and profit-making companies can all be social enterprises.  It’s more of a concept and a label that helps to demonstrate the values and define the activities of your company or organisation.  To me, ‘Social Enterprise’ suggests working towards positive social change in innovative ways, using the basis of a circular economy – John Elkington named this ‘The Triple Bottom Line,’ or People, Planet, Profit.  In other words, the money that is generated by the company’s activity is used to support more social and environmental change.

Keep in mind this is a very basic description of the social enterprise concept, there are a myriad of shapes and sizes of social enterprises, and a million theories that inform how a social enterprise is developed.  The reason I bring it up in this first blog entry is because although we have no formal legal structure and are classified as an Unincorporated Association, Blank Cheque is a social enterprise.  Our drama-based work seeks to empower people, primarily women, to be positive and confident citizens with a strong sense of self-identity, and to help break down negative stereotypes while raising awareness about the issues criminalised and marginalised women face. 

My challenges, as a social entrepreneur, are to find out:

• what formal legal structure is suitable for Blank Cheque

• how to generate income through our arts-based activities

• how to build robust impact measurement within our organisational strategy

• and how human-centred design practices can inform Blank Cheque’s work to deliver the most social value it can

So that’s my starting point!  Like I said, I’ll use this space to try to make sense of concepts, to share discoveries, and to ultimately explore the potential of arts-based social enterprises to be financially independent architects of a more inclusive, more aware, and more supportive society.  Please feel free to leave comments and interrogate these entries, a good debate is always an opportunity for learning.