Category: Only In Academies

Academy trusts may wish to change their articles of association to alter the number of trustees on the board, change the balance of trustee types, adopt new DfE model articles or make other alterations to their governance rules.

This page explains how articles of association can be changed and who needs to give their permission before the amended articles come into force.

(Maintained schools do not have articles of association but may wish to change their instrument of government.)

Must we update our articles whenever new model articles are published?

No. The DfE publish new model articles on a fairly regular basis but there is no requirement to adopt new articles whenever a new model is released.

The current model articles for mainstream academies were published in 2021 but many trusts have older articles in place.

However, the DfE say it is important for trusts to “review their articles regularly and to keep them up-to-date”.

“The model articles reflect elements of charity and company law and departmental governance policy.

“We update the model articles of association from time to time to reflect developments in these areas; it is important for trusts to review their articles regularly and to keep them up-to-date.”

Model Articles of Association (June 2021)

Over time your articles may start to conflict with the Academy Trust Handbook and best practice advise from the DfE. If that happens the trust may wish to adopt new articles.

For example, some trusts still have staff trustees in their articles despite the recommendation in the current Academy Trust Handbook that the CEO/principal is the only employee who should serve as a trustee.

How have the model articles changed over time?

I’ve listed below some requirements of the current mainstream model articles which may conflict with your own articles because the DfE recommendations have changed over the years.

The current mainstream model articles:

• say that the CEO/principal should be the only staff trustee
• set the quorum for members’ meetings at a majority of members (older articles set the quorum at just two members)
• allow virtual meetings of both members and trustees
• say that the majority of members must not also be trustees
• set a requirement for a members’ annual general meeting (this used to be optional)
• say documents can be signed electronically and references to documents “in writing” include electronic documents.

What if we want to adopt the new model articles but add our own amendments?

My understanding is that it’s difficult to get permission to make your own amendments to the model articles.

However, you could ask in advance whether the changes might be considered by contacting the Education and Skills Funding Agency (ESFA). (ESFA is just a department of the DfE.)

However, if the amendments you want to make contradict the current Academy Trust Handbook I imagine ESFA will not give permission.

Preparing To Change Your Articles of Association

Before you start the formal process to change the articles follow the steps below to prepare.

Trustees Discuss the Reasoning

Your trust board should discuss why new articles might be needed, the advantages and disadvantages of proposed changes and the impact this would have on governance.

If your trustees want to suggest changes to the DfE model articles they should produce a draft of their proposed changes to send to ESFA to see if they might be accepted.

Check Your Funding Agreement

Your trust’s funding agreement may contain wording that relates to changing the articles and whose permission you need before doing so. It’s likely that the funding agreement requires you to seek permission from ESFA.

Check If You Are Changing Your Objects

The “objects” are the charitable aims of your academy trust, found at the start of your articles. If you wish to change the trust’s objects you must seek approval from the Charity Commission, so it adds extra complexity.

In general I suspect you will not need to change the trust’s objects. They usually consist of a broad statement basically saying the trust provides education to children and hopefully you still want to do that!

Get Provisional Consent From Diocese (Church Academies Only)

If your academy trust runs any church academies you will need consent from the linked religious body named in the articles, eg: the diocese in a Church of England trust.

You should also check if your current articles of association contain article 10. If you have an article 10 this article requires you to seek permission from another party to change the articles of association, particularly in church academies.

Below is an example article 10, which says this academy trust needs written consent from the Secretary of State (which means ESFA on behalf of the Secretary of State for Education), the foundation members, the trustees and the diocese to amend their articles.

“No alteration or addition shall be made to or in the provisions of the memorandum and/or articles without the written consent of the Secretary of State and of the foundation members, the trustees and the diocesan board of education.”

Debenham High School Articles of Association (Article 10)

Get Provisional Consent From Members

For the articles to be changed your members need to pass a special resolution in favour as the final stage of the process.

A special resolution must be passed by a majority vote of at least 75%. Therefore it’s wise to to check if your members have any objections to the new articles before the formal process starts.

Procedure To Change An Academy Trust’s Articles of Association

Below is a suggested process to formally change your articles of association.

PLEASE NOTE: If you are in any doubt please seek advice from your trust’s lawyers as this is a legal process that must follow the Companies Act 2006.

1. Trustees Vote In Favour of New Articles

Send a draft of the new articles to all trustees along with the agenda for the meeting. The proposed change to the articles should be clearly listed as an agenda item.

The board of trustees must hold a vote in favour of the new articles of association at a quorate meeting, passed by the usual majority. The vote does not need to be unanimous or passed by a certain percentage of trustees.

2. Obtain Approval From Diocese or Charity Commission (If Needed)

If you are in a church trust and/or your article 10 said you needed approval from another party obtain their written approval for the proposed changes.

If you are changing the trust’s objects seek written approval from the Charity Commission.

3. Obtain Approval From ESFA

Send a copy of the new articles your trustees have approved to ESFA for their formal written approval.

4. Members Vote in Favour

If your board of trustees, ESFA and (if necessary) the diocese/other parties have all approved your new articles the final step is for your members to pass a special resolution in favour of changing the articles.

A special resolution means a majority vote of 75% or more in favour. This is a requirement of the Companies Act 2006.

“A company may amend its articles by special resolution.”

Companies Act 2006 (Section 21)

If you have just three members at the meeting this means you need all three members to vote in favour, because otherwise you only have 66% in favour or less (two out of three people or less).

This is why you should check early on that members are happy with the changes or you could be foiled by just one person!

The text of the proposed special resolution must be included in the agenda that’s sent out for the member’s meeting, together with the draft new articles. Below is some text for a special resolution you could print in the agenda.

Pursuant to the Companies Act 2006 the Members of the Company propose that the following Resolution is passed as a special Resolution. Upon acceptance of this Resolution by a 75% majority of the Company’s Members it will be passed.

SPECIAL RESOLUTION

“It is resolved that the draft articles of association attached to this Resolution be adopted as the articles of association of the Company in substitution for, and to the exclusion of, the existing articles of association.“

If your members pass the special resolution by 75% or more then the change has been agreed.

Congratulations! The new articles of association are officially in force.

5. Send New Articles and Special Resolution to Companies House and ESFA

The new articles of association and a copy of the special resolution must be sent to Companies House within 15 days of being approved by the members. This is a requirement of the Companies Act 2006.

“Where a company amends its articles it must send to the registrar a copy of the articles as amended not later than 15 days after the amendment takes effect.”

Companies Act 2006 (Section 26)

A copy of the new articles and special resolution should also be sent to ESFA.

6. Complete Forms CC02 and CC03 (If Needed)

If your old articles contained article 10 and you have now removed this article then you need to complete form CC02. It can be filed here.

If your article 10 said you needed consent from the DfE, diocese or other body to amend your articles you need to complete form CC03. It can be filed here.

An annual general meeting (AGM) is a meeting of academy trust members.

During an AGM the members formally receive the trust’s audited accounts and annual report, appoint or reappoint auditors and review the governance of the academy trust.

They can also appoint any member-appointed trustees and take other decisions that require the approval of members, such as changing the articles of association.

Members also receive updates from the Principal/CEO and trustees about how the trust has fared over the year and the plans for the upcoming years. Members address questions to the trustees and trust leaders to confirm that governance is strong.

This page only applies to academies. AGMs do not exist in maintained schools.

Do all academy trusts have to hold AGMs?

It depends what your articles of association say.

The current model articles for mainstream academy trusts say that trusts “shall hold” an AGM each financial year (1 September to 31 August). So trusts using these model articles must hold an AGM each year.

“The Academy Trust shall hold an Annual General Meeting each Academy Financial Year.”

Model Articles of Association (June 2021)

In earlier versions of the model articles the clause that required an AGM was marked as optional, so trusts could remove it.

“The academy trust must now hold an Annual General Meeting. In previous versions of the mainstream model [articles] this was an optional clause.”

Model Articles of Association (June 2021)

If the AGM clause does not appear in your articles your trust is not required to hold an AGM.

However, it is considered good practice to allow members to meet at least once per year, so the trust could still decide to hold an AGM for this purpose.

When are AGMs held?

AGMs are often held in December. The annual report and accounts must be sent to the Education and Skills Funding Agency (ESFA) by 31 December each year, so they will be ready to present to members shortly before this.

“The audited report and accounts must be submitted to ESFA by 31 December.”

Academy Trust Handbook

There is no set date on which you must hold an AGM, but be aware that the model articles only allow for a gap of 15 months between annual general meetings.

“Not more than fifteen months shall elapse between the date of one annual general meeting of the academy trust and that of the
next.”

Model Articles of Association (June 2021)

Also be aware that the appointment of auditors needs to be made within 28 days of the members receiving the annual accounts.

“It is normal to deal with the reappointment of auditors at an annual general meeting (AGM) and the term of office will typically run from one AGM to the next.

“The general points to note under the Companies Act 2006 are as follows: appointment of the auditor will ordinarily be within 28 days of the academy trust providing its annual accounts to its members (section 485(2) of the Act).

“For academy trusts, this would usually be at an AGM.”

Choosing An External Auditor For An Academy Trust

Who can call an AGM?

The AGM is called by the trustees, not the members.

“The Annual General Meeting shall be held at such time and place as the trustees shall appoint.”

Model Articles of Association (June 2021)

How much notice must be given for an AGM?

The model articles say that at least 14 clear day’s notice must be given to call an AGM, unless at least 90% of members agree to hold it at shorter notice.

“General meetings shall be called by at least fourteen clear days’ notice but may be called by shorter notice if it is so agreed by a majority in number of members having a right to attend and vote and together representing not less than 90% of the total voting
rights at that meeting.”

Model Articles of Association (June 2021)

“Clear days” means that you don’t count the day the notice was sent. So if the notice was sent at 3pm on Monday 1 December then a gap of 14 clear days means you can hold the AGM on Tuesday 16 December.

The notice (which usually doubles as the agenda) must:

• state the time and place of the meeting
• contain a description of the business that will be carried out
• specify that this is an AGM
• tell members they are allowed to appoint a proxy to attend and vote in their place.

“The notice shall specify the time and place of the meeting and the general nature of the business to be transacted and, in the case of an annual general meeting, shall specify the meeting as such.

“The notice shall also state that the member is entitled to
appoint a proxy. The notice shall be given to all the members, to the trustees and auditors.”

Model Articles of Association (June 2021)

What should be on the agenda for an AGM?

“Members may want to use an AGM to review the trust’s annual audited accounts and broader issues of trust governance with the board.

“AGMs help ensure that members are kept informed about the actions and decisions of the board, supporting the accountability of the trustees, give a formal opportunity for members to exercise their legal duties and powers in overseeing trust governance, for example, routine appointments to the board and can be used to review the trust’s audited accounts and broader issues of trust governance with the board.”

DfE Academy Trust Governance Guide

A example agenda for an AGM is shown below. It contains the “notice” of the meeting at the top of the agenda. My templates and letters page provides an editable Word version of a complete AGM agenda.

If members will be asked to agree any special resolutions the text of every special resolution must also be included in the notice.

Special resolutions require 75% of members to agree and are used for decisions such as appointing members, changing the articles of association and any other decision in your articles that requires a special resolution.

(Bear in mind that if you have a special resolution coming up and you only have three members, the 75% requirement means that your three members must be unanimously in favour for the special resolution to pass.)

Notice of Annual General Meeting (AGM) for Malory Towers Academy Trust

Notice is hereby given that the annual general meeting of Malory Towers Academy Trust, company registration number 99999999 will be held on [time and date] at Malory Towers Academy, Blyton Road, London.

The following business will be transacted.

AGM Agenda

1. Welcome
2. Apologies for Absence
3. Confirm Meeting is Quorate
4. Declaration of Interests
5. Election of Chair of AGM
6. Minutes from Previous AGM
7. Report from Chief Executive Officer
8. Receive Annual Report and Accounts
9. Appointment or Reappointment of Auditors
10. Appointments or Resignations of Trustees (if needed)
11. Appointments or Resignations of Members (if needed)
12. Consider Proposed Changes to Articles of Association (if needed)
13. Any other business

Do members approve the accounts?

No. The board of trustees approve the accounts and they are signed by the chair of trustees to indicate the trustees’ approval.

Members just “receive” the accounts. They are being told the information and invited to ask questions, not make a decision.

The accounts should have been scrutinised by the trust’s finance committee in detail and then given final approval by the full board of trustees.

Who can attend the AGM?

The members, trustees and auditors must all be invited to attend.

“The notice shall specify the time and place of the meeting and the general nature of the business to be transacted and, in the case of an Annual General Meeting, shall specify the meeting as such.”

“The notice shall be given to all the Members, to the Trustees and
auditors.”

Model Articles of Association (June 2021)

The principal/CEO and the finance director usually attend as well. The clerk attends to take minutes and give procedural advice.

There is no requirement to invite local governors in a multi-academy trust, parents, other stakeholders such as trust employees or people from the local community. However, your trust could decide to invite other stakeholders if they wish.

Do we have to advertise the AGM?

No. As there is no requirement to invite anyone to the AGM who is not a member, trustee or auditor there is no requirement to advertise the AGM to anyone who is not a member, trustee or auditor.

If the trust wishes to invite other stakeholders such as parents they will of course have to advertise the AGM to those stakeholders.

Who can vote at an AGM?

Only members can vote at an AGM, because it is a members’ meeting.

Any trustees who attend cannot vote, nor can anyone else who attends like a local governor in a multi-academy trust.

What is the quorum for an AGM?

This will also depend on your own articles.

The current model articles say that the quorum is a majority of members. For example, two out of three members or three out of five.

Note that members voting by proxy count towards the quorum.

“No business shall be transacted at any meeting unless a quorum is present. A quorum is a majority of members present in person or by proxy and entitled to vote upon the business to be transacted.”

Model Articles of Association (June 2021)

However, older versions of the articles said that the quorum was just two members.

“It is now a requirement that a majority of members are present at an annual general meeting and a general meeting. In previous versions of the mainstream model articles, only two members were required to make up a quorum.”

Model Articles of Association (June 2021)

Any trustees or local governors who attend do not form part of the quorum.

How do members vote by proxy?

Members can appoint a proxy in writing using a signed document that they return to the registered company office of your trust. The form of words to use is in your articles, check articles 40 and 41. There are two ways that a proxy can behave.

A member can appoint a proxy and give them the freedom to vote however they wish. The member would have to trust their proxy’s judgement.

Alternatively a member can appoint a proxy and instruct them how to vote on each decision.

Who can act as a proxy?

The model articles allow anyone to act as a proxy, so it could be a trustee or local governor for example who was planning to attend the meeting anyway.

Who chairs the AGM?

The current model articles say that the members elect one of the members to chair the meeting. They do this via an “ordinary resolution”, which just means a majority vote in favour.

“The members present and entitled to vote at the meeting shall elect by ordinary resolution one of their number to be the chair and such election shall be binding on all members and trustees present at the meeting.”

Model Articles of Association (June 2021)

Make sure you check your own articles though, as some older versions of the articles stated that the chair of trustees must be the chair of members’ meetings.

In academies the members and trustees make decisions by passing resolutions. A resolution is a vote in favour or against a proposal.

This page explains written resolutions. It also provides example written resolutions for both members and trustees.

The ability of members to pass written resolutions comes from the Companies Act 2006. The ability of trustees to pass written resolutions comes from the articles of association for each academy trust.

The advice on this page is based on the current model articles of association, but please check your own articles as they may differ.

The usual rules about conflict of interest apply to all resolutions. If a member or trustee has a conflict of interest they cannot vote.

What is a written resolution?

A written resolution is a decision that is taken outside of a meeting. Instead of voting during a meeting by a show of hands or verbal agreement the members or trustees are sent a document that explains the proposal and asks them to sign if they agree with it.

For example, the members might wish to appoint a new member via written resolution. Written resolutions are particularly useful for members’ decisions because members rarely hold meetings.

If a member wishes to appoint the new member they sign the document and send it back to the clerk. If a member doesn’t want to appoint the new member they don’t need to do anything, because the lack of a reply is taken to mean that they disagree with the resolution.

What are the different types of written resolution?

Members have two different types of written resolution, ordinary or special. Your articles tell you whether a decision should be passed via ordinary or special resolution.

Written ordinary resolutions are passed if 51% of members vote in favour.

Written special resolutions are passed if 75% of members vote in favour.

Trustees have one type of written resolution, written board resolutions. Written board resolutions are passed if 100% of the trustees eligible to vote are in favour.

Example Written Resolutions

Below you can download some examples of written resolutions for both members and trustees.

This is a members’ written ordinary resolution to appoint a new trustee.

Download members’ written ordinary resolution (.docx file)

This is a members’ written special resolution to change the articles of association.

Download members’ written special resolution (.docx file)

This is a trustees’ written resolution to appoint a local governor to a local governing body.

Download trustees’ written resolution (.docx file)

How do members pass written ordinary resolutions?

Members’ written ordinary resolutions are passed if 51% of the members who are entitled to vote agree. This is known as a simple majority. As long as more members vote in favour than against, the resolution has passed.

So if you have three members in total, all of whom are entitled to vote, a written ordinary resolution needs two out of three members voting in favour (66%). If you have five members then three out of five need to vote in favour (60%).

“An ordinary resolution of the members (or of a class of members) of a company means a resolution that is passed by a simple majority.

“A written resolution is passed by a simple majority if it is passed by members representing a simple majority of the total voting rights of eligible members.”

Companies Act 2006 (Section 282)

How do members pass written special resolutions?

Members’ written special resolutions are passed if 75% of members entitled to vote are in favour.

So if you have three members you actually need all three to vote in favour to pass a written special resolution (100%). If only two vote in favour you only reach 66% agreement, which of course is less than 75%.

If you have five members then you need four out of five members voting in favour (80%).

“A special resolution of the members (or of a class of members) of a company means a resolution passed by a majority of not less than 75%.

“A written resolution is passed by a majority of not less than 75% if it is passed by members representing not less than 75% of the total voting rights of eligible members.”

Companies Act 2006 (Section 283)

When are members forbidden from using written resolutions?

There are two situations where members cannot make a decision using a written resolution. Instead they must call a members’ meeting.

Members cannot use written resolutions to remove a trustee before the end of their term of office or remove an auditor before the end of their term of office.

“The following may not be passed as a written resolution—

(a) a resolution under section 168 removing a director before the expiration of his period of office;

(b) a resolution under section 510 removing an auditor before the expiration of his term of office.”

Companies Act 2006 (Section 288)

How do trustees pass written resolutions?

The current model articles allow trustees to pass written resolutions outside of meetings. These are often called board written resolutions.

The model articles say written board resolutions must be “signed by all trustees” who are entitled to vote on trust board decisions.

Therefore, trustees’ written resolutions pass if 100% of trustees entitled to vote are in favour. They must be unanimous, in other words.

If it is a committee decision then the written resolution must be signed by all the trustees on that committee who are entitled to vote.

Because trustee written resolutions must be unanimous they are not massively useful. It may be easier to hold a virtual trust board meeting instead, where decisions only need a simple majority to pass.

“A resolution in writing, which includes a resolution in electronic form, signed by all the trustees entitled to receive notice of and vote at a meeting of trustees or of a committee of trustees, shall be valid and effective as if it had been passed at a meeting of trustees or (as the case may be) a committee of trustees duly convened and held.

“Such a resolution may consist of several documents in the same form, each signed or authenticated by one or more of the trustees.”

Model Articles of Association (June 2021)

Do members or trustees have to sign the same copy of the resolution?

No. The model articles say that resolutions of both members and trustees can be formed of more than one copy of the same document. (For members the wording is “several instruments in the like form” and for trustees it is “several documents in the same form”, but these two phrases mean the same thing.)

There’s no need to circulate just one document to collect all signatures on the same sheet of paper.

Can written resolutions be emailed and signed electronically?

Yes, if you have adopted the June 2021 model articles, as they specifically allow resolutions in “electronic form” for both members and trustees. They also specifically allow electronic signatures. This means a resolution is valid even if completely digital, for example an email attachment signed with a digital signature.

If you have older articles please check the wording to see whether electronic resolutions and signatures are allowed.

If your articles do not specifically allow for electronic resolutions or signatures you could email the resolution document and ask members/trustees to print it, sign it and post it back or drop it off at the academy.

“A resolution in writing, which includes a resolution in electronic form, agreed by such number of members as required if it had been proposed at a general meeting shall be as effectual as if it had been passed at a general meeting duly convened and held provided that a copy of the proposed resolution has been sent to every member.

“A resolution in writing, which includes a resolution in electronic form, signed by all the trustees entitled to receive notice of and vote at a meeting of trustees or of a committee of trustees, shall be valid and effective as if it had been passed at a meeting of trustees or (as the case may be) a committee of trustees duly convened and held.

“References to a document being ‘signed’ includes those signed electronically.“

Model Articles of Association (June 2021)

This page explains the difference between members, trustees, directors and governors in academies.

It also explains what local governors are in multi-academy trusts.

The Structure of Academy Governance

First we need to look at the structure of academy governance.

Single academy trusts (SATs) only contain one academy. In a single academy trust the members sit at the top of the structure. Below the members are the trustees.

So from top down, the structure of a SAT looks like this: members > trustees.

Multi-academy trusts (MATs) contain two or more academies. In multi-academy trusts the members sit at the top of the structure. Below the members are the trustees. And below the trustees, in the majority of MATs but not all, are local governors based at each individual academy.

So in a minority of MATs, the structure has two tiers: members > trustees.

And in the majority of MATs the structure looks like this, with three tiers: members > trustees > local governors.

Let’s start at the top of the structure and explain the role of members.

Members

Members are sometimes called the “guardians” of the academy trust. They set up the trust by signing the memorandum of association and after that have a limited but important role in checking that governance is working well.

Members may be required to attend just one meeting per year, the annual general meeting (AGM), although more members’ meetings may be held depending on the trust.

The main role of members is to hold the trustees to account and oversee their work. They have a look at the accounts, ask trustees questions and make sure there are no serious problems they need to address.

Members have the power to:

• appoint some trustees
• remove all trustees
• appoint or remove other members
• direct academy trustees to do things, which means formally order trustees to address a problem like a safeguarding concern
• change the articles of association
• change the name of the trust
• appoint or remove auditors
• receive and review (but not sign off) the annual audited accounts.

Members have an eyes on, hands off role, which means they keep an eye on the work of trustees but are nowhere near as involved in governance as trustees. They do not usually visit their academies or attend trustee meetings.

Trusts generally have a small number of members, often three or five. The minimum number of members for any trust is three, but the DfE’s preference is for trusts to have at least five members.

Members must not be employed by your academy trust.

(Academy members should not be confused with associate members in maintained schools – they are totally different roles.)

Trustees

(Note: I’m going to refer to trustees here because that is the name used in documents like the Academy Trust Handbook, but in your own trust they may be called either trustees, directors or governors. I’ll explain why later.)

Next up are the trustees. The board of trustees is where most of the power lies in an academy trust. Trustees have three core functions:

1. ensuring the academy trust has a clear ethos, vision and strategic direction
2. holding senior leaders to account for the educational performance of the academies
3. overseeing the budget and ensuring value for money.

The board of trustees meets far more regularly than members and is the main decision-making body for the trust.

It is the trustees who:

• hire the Principal or CEO
• sign off the annual accounts
• check the trust is following its funding agreement
• have responsibility for safeguarding children
• have legal responsibility for health and safety, equality and other legal duties
• approve the statutory and non-statutory policies (unless they have been delegated down to staff or committees)
• visit academies to monitor how policies are put into practice and talk to staff and children
• establish or abolish committees, including local governing bodies.

The number of trustees depends on the number allowed by your trust’s articles of association. The powers that trustees choose to delegate will be explained in your trust’s scheme of delegation.

Can a member also be a trustee?

Yes, a person can be both a member and a trustee at the same trust.

However, the DfE’s preference is for most members not to be trustees, to make sure there is significant separation between the tiers of governance.

Members hold trustees to account and they obviously can’t do that effectively if the members and trustees are mostly the same people.

“The majority of members should not also be trustees.”

Academy Trust Handbook

Local Governors

Local governors only exist in multi-academy trusts, not single academy trusts. They sit on local governing bodies (LGBs), which are committees of the board of trustees. Usually each academy in a MAT will have its own LGB, based on site at that academy.

Local governors only have the powers that the trustees have delegated to them. These powers can vary considerably. In some trusts the LGB may not have any powers to take decisions, only to discuss issues and make recommendations. These LGBs are known as advisory bodies.

Local governing bodies may also be known as local governing committees, local academy committees, academy advisory councils or academy councils.

Can a trustee also be a local governor?

Yes, although again it is considered best practice for a majority of trustees not to be local governors in order to separate the tiers of governance. This is just a best practice recommendation though, not a requirement of the Academy Trust Handbook.

Trustees Versus Directors Versus Governors

If you look at the articles of association for your academy trust you may see a section about trustees or you may see a section about directors or governors.

Trustee, director and governor are three different names for the exact same role. They all refer to the people who sit on the main decision-making board directly below the members.

Malory Towers Academy Trust might call them trustees, Hogwarts Academy Trust might call them directors and St Trinian’s Academy Trust might call them governors, but they are all doing the same thing.

Why are trustees called directors or governors at some academies?

Some academies, particularly church academies, couldn’t say their trust board was made up of “trustees” because they already had trustees. Their existing trustees sat on the board of the trust that owned their academy’s land.

So secular academies could have a board of trustees, but some church academies needed a board of directors in order to avoid confusing the two different boards.

Directors was a suitable name because academies are charitable companies and so the people on the trust board are company directors.

This doesn’t explain why some academies use the name “governors” instead of trustees or directors though. To be honest I’m not sure why they do. If anyone does know please get in touch!

Academy trusts must ensure they do not have too many local authority associated persons (LAAPs) among their trustees and members.

The limit on LAAPs is set at 19.9% of trustees and 19.9% of members. There are also additional limits on voting rights which I will explain later.

This page explains who qualifies as an LA-associated person, how many LAAPs each academy trust is allowed to have among its members and trustees and what happens if that limit is exceeded.

This article only applies to academies because LAAPs do not exist in maintained schools.

Rules From Articles Of Association

The rules on LA-associated persons are found in the final section of the current model articles of association.

The section is called Avoiding Influenced Company Status. An “influenced company” is one where the LA holds significant power or control and academy trusts are not-for-profit companies.

Check the last few pages of your own articles to find the relevant part. There are three basic rules:

1. no more than 19.9% of trustees can be LAAPs
2. no more than 19.9% of members can be LAAPs
3. LAAPs cannot hold more than 19.9% of voting rights at any meeting of trustees or members.

So LA-associated persons must never make up one-fifth or more of your trustees or one-fifth or more of your members.

The articles also say that LAAPs who are trustees or members must hold less than 20% of the voting rights at any meeting. In practice, as long as you limit the number of trustees/members to less than 20% of the total people in post you should not have to worry about the voting rights limit.

Technically it would be possible to hold a members’ meeting where, for example, only five out of seven members attend and one of the attendees is a LAAP, giving them voting rights of 20%, but that seems fairly unlikely.

It would be even less likely in a meeting of trustees because you will usually have significantly more trustees than members in place.

Who qualifies as an LA-associated person?

A trustee or member is an LA-associated person if any of the following apply:

• they are currently a councillor
• they have been a councillor in the last four years
• they are currently employed by the LA
• they are both an employee and either a director, manager, secretary or similar officer of a company controlled by the LA.

To see where that definition comes from we first need to check the model articles of association. At the start of the articles is a section called “Interpretation” which contains definitions for terms used in the articles. Below is the definition given for a LAAP.

“‘Local Authority Associated Person’ means any person associated (within the meaning given in section 69(5) of the Local Government and Housing Act 1989) with any local authority by which the academy trust is influenced.”

Model Articles of Association (June 2021)

So next we need to check section 69(5) of the Local Government and Housing Act 1989 which tell us when someone qualifies as a LAAP.

Section 69(5) explains that someone is a LAAP if they:

• are a member of the local authority (a “member” means a councillor)
• have been a member within the last four years
• are an officer of the authority (an “officer” means an employee)
• are both an employee and either a director, manager, secretary or other similar employee of a company which is under the control of the authority.

“For the purposes of this section, a person is at any time associated with a local authority if—

(a) he is at that time a member of the authority;

(b) he is at that time an officer of the authority;

(c) he is at that time both an employee and either a director, manager, secretary or other similar officer of a company which is under the control of the authority; or

(d) at any time within the preceding four years he has been associated with the authority by virtue of paragraph (a) above.”

Local Government and Housing Act 1989 (Section 69)

Can local governors be LA-associated?

No. Only members and trustees can be LAAPs. If someone is a local governor in a multi-academy trust they cannot qualify as a LAAP. They also cannot qualify as a LAAP if they sit on any other academy committee but are not a trustee.

It may seem odd that the DfE places no limits on local governor LAAPs in their model articles, as you could in theory have a local governing body stuffed to the brim with LAAPs but a 19.9% limit at trustee and member level.

However, I assume the reasoning is that the trustees and members hold the real power in each trust. The local governors only hold powers that have been delegated down to them.

What counts as a local authority?

The definition of a local authority is found in section 67 of the Local Government and Housing Act 1989. It is a very wide definition so check the Act to see the full list, but it includes:

• county councils
• county borough councils
• district councils
• London borough councils
• parish councils
• community councils
• fire and rescue authorities
• policy authorities.

What if someone is associated with an LA that is not close to the academy?

They still qualify as an LA-associated person, whether or not the LA they are associated with is geographically close to the academy trust. The definition of a LAAP in the model articles refers to any person associated with any local authority by which the trust is influenced.

For example, if a trustee at an academy in London is also employed by Devon county council they are still considered a LAAP.

Do LA-associated persons need permission from the LA to join the board?

The current model articles say that any trustee joining the board needs permission from the LA they are linked to. They do not say that someone who is joining your trust as a member needs permission from the LA. (Check your own articles to confirm this.)

“No person who is a local authority associated person is eligible to be appointed or elected to the office of trustee unless their appointment or election to such office is authorised by the local authority to which they are associated.”

Model Articles of Association (June 2021)

Can elected trustees count as LAAPs?

Yes. The rules on LAAPs apply equally to both appointed and elected trustees, so a parent trustee elected by the parent body could be a LAAP, as could a staff trustee elected by members of staff.

Do school employees count as LAAPS?

If they are employed by a maintained school then yes, they count as a LAAP. If they are employed by an academy trust then no, they are not a LAAP.

Example Calculations

Remember that 19.9% is the maximum number of LA-associated persons allowed among your members and the same limit is placed on your trustees. Here are the calculations of how many LA-associated persons an academy trust can have.

Member Calculations

A trust with five members or fewer cannot have any LAAP members, because you would immediately breach the 19.9% limit. Just one LAAP member would make up 20% (or more) of members by themselves.

A trust with six to 10 members could have only one LAAP member, who would form between 16.6% to 10% of the total members.

Trustee Calculations

A trust with five trustees or fewer cannot have any LAAP trustees (but in reality all academy trusts will have more trustees than this).

A trust with six to 10 trustees could have only one LAAP trustee, who would form between 16.6% to 10% of the total trustees.

A trust with 11 to 15 trustees could have only two LAAP trustees (18% to 13%).

A trust with 16 to 20 trustees could have only three LAAP trustees (18.75% to 15%).

What happens if a member or trustee becomes a LAAP during their term of office?

The model articles say that if a member or trustee becomes a LAAP during their term of office, for example they get a job working for the council, they are “deemed to have immediately resigned”.

In other words, they immediately stop being a member or trustee and have no choice in the matter. Notice that in this clause it doesn’t matter whether your new LA-associated person takes you over the 19.9% limit or not; they are deemed to have resigned either way.

“If at the time of either their becoming a member of the academy trust or their first appointment or election to office as a trustee any member or trustee was not a local authority associated person but later becomes so during their membership or tenure as a trustee they shall be deemed to have immediately resigned their membership and/or resigned from their office as a trustee as the case may be.”

Model Articles of Association (June 2021)

If we have an LA trustee are they a LAAP?

Only if they meet the definition of a LAAP described above, for example they are employed by the LA. They are not an LA-associated person just because they are an LA trustee.

Current model articles of association don’t contain the role of LA trustee, but some academy trusts will have LA trustee vacancies in their articles, particularly if their articles have not been updated in many years.

These LA trustees may be either nominated or appointed by the LA but beyond that they do not have any links with the LA or vote on behalf of the LA. Once they are on the board they function in the same way as any other trustee.

What happens if we have too many LAAPs in post?

The articles of association have been written so that it is not possible to accidentally appoint or elect too many LAAPs. The wording says that the extra trustees or members who are LAAPs are “deemed to have resigned immediately before” their appointment or election.

In effect, therefore, the extra LAAPs never joined your academy trust at all, so it’s not possible to accidentally breach the limit.

“If at any time the number of trustees or members who are also local authority associated persons would (but for articles 139 to 142 inclusive) represent 20% or more of the total number of trustees or members (as the case may be) then a sufficient number of the trustees or members (as the case may be) who are local authority associated persons shall be deemed to have resigned as trustees or members immediately before the occurrence of such an event.”

Model Articles of Association (June 2021)

The model articles also explain what would happen in the unlikely event that two LAAPs have recently been elected or appointed but only one needs to resign to keep the academy trust under the 19.9% limit – the person who has joined the trust most recently must leave.

“Trustees or members (as the case may be) who are local authority associated persons shall be deemed to have resigned in order of their appointment or election date the most recently appointed or elected resigning first.”

Model Articles of Association (June 2021)

Why is it important to limit the numbers of LA-associated people?

If an academy trust has too many LA-associated people it becomes an influenced company. The law places a number of restrictions and burdens on influenced companies that influenced academy trusts would have to fulfil.

Part II of The Local Authorities (Companies) Order 1995 explains what influenced companies must do. I won’t list all the requirements here, but to give you a flavour an LA-influenced academy trust would have to:

• write that it is an LA-influenced company on documents like its letters
• remove a trustee if they were disqualified from being a member of an LA
• provide information requested by the Audit Commission
• provide information requested by local councillors.