Constitution
Definition: The Constitution is a civil contract among participants in the organization. It spells out their rights and responsibilities, establishes the initial decision-making and governance bodies and provides a framework for self-organizing growth and evolution of the organization to occur.
Constitution - In Context: Once the Organizational Concept is reasonably clear, the organizational structure and functioning are expressed in a written Constitution (by-laws) or other binding agreement appropriate to the organizational form. Charter agreements can also be developed for initial participants in the new organization, if necessary.
Work during this phase results in a set of documents that refine and incorporate, with precision, the substance of the previous steps. They will embody Purpose, Principles and Concept; specify rights, responsibilities and relationships of all participants; and establish the organization as a legal entity in an appropriate jurisdiction. Involvement of expert legal counsel is required.
Developing a Constitution - a carefully articulated agreement that will be legally binding - usually involves refining prior work on Principles, Participants and Organizational Concept. Initial decisions about certain aspects of the Organizational Concept, in particular, are likely to receive intensive scrutiny and to be tested against all other decisions that have been made. The Organizational Concept is often simplified and made more coherent during this phase.
The Constitution is the legal foundation for the organization. Once adopted, it is the framework guiding trustees, management, staff and participants in pursuit of the Purpose, and enables self-organization and evolution of the organization.
See the Constitution for the Chaordic Commons, Inc. The box below includes a more generic sample Table of Contents for a Constitution to provide an overview of the topics addressed.
Processes and Approaches
Writing a Constitution will require the involvement of legal counsel. We recommend that legal counsel be engaged no later than the Organizational Concept phase, and that counsel participate in at least the last meeting concerning Organizational Concept in order for counsel to be better prepared for work on the Constitution. In some cases, it is advisable to retain counsel earlier for advice on specific legal issues (if, for example, antitrust issues arise in the course of an inter-organizational initiative.)
We strongly recommend working with lawyers familiar with chaordic concepts and experienced in writing Constitutions and other legal documents based on them. Most lawyers, by training and experience, are accustomed to thinking and working solely in the context of hierarchical, command and control organizations, and they often have difficulty understanding concepts of chaordic organization and preparing organizational documents based on those concepts.
We also recommend working intensively with a much smaller group drawn from the design team during this phase. The full design team - or those leading the strategic change initiative - can designate a group of 2-4 individuals to be responsible for the careful, detailed work of reviewing drafts of the Constitution and resolving any issues that arise.
Sometimes existing Constitutions, including the Constitution we have written for the Chaordic Commons, can serve as a template for a group's first draft. The kinds of topics to be addressed in a Constitution are illustrated in the box on below.
When the Constitution drafting team meets, having received a draft Constitution for review ahead of time, we explore with them such general questions as:
- Does the Constitution accurately embody the work done by the design team on Purpose, Principles, Participants and Organizational Concept?
- Does the Concept as it is expressed in the Constitution accurately embody the Principles, especially with respect to such issues as the right of self-organization, the distribution of power, and decision-making?
- Can the Organizational Concept be streamlined, to resolve inconsistencies, unnecessary complications or flaws?
- Has the organization been given sufficient powers to make, implement and enforce decisions involving the needs of the system, to balance participants' right of self-organization?
In our experience, writing a Constitution always provides opportunities to refine the organizational concept - if the task is approached with attention to detail and a commitment to embodying the Principles as fully as possible. At least two and often more drafts are required to identify and work through all the issues that are likely to arise.
Sample Table of Contents
for Constitution
Article I
|
Purpose and Principles
|
Article II
|
Classes and Categories of Members
|
Article III
|
Eligibility for Membership
|
Article IV
|
Applications for Membership
|
Article V
|
Admission of Members
|
Article VI
|
Termination of Membership
|
Article VII
|
Sizes and Compositions of Council
|
Article VIII
|
Primary Functions of Council
|
Article IX
|
Appointment and Election of Council
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Article X
|
Powers and Responsibilities of Council
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Article XI
|
Rights and Responsibilities of Members
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Article XII
|
Officers and Staff
|
Article XIII
|
Decisions and Voting Requirements
|
| Article XIV |
Miscellaneous (For example, annual and special meeting dates, record dates and notices; allowable means of communication and voting, including proxies; nature of fiduciary duties of trustees on Councils; etc.) |
In addition to the general issues just mentioned, a variety of more specific questions will require very careful thought during this phase. Some will have been addressed, at least in part, in prior conversations; others will not have been. They include such questions as:
- What common properties will the organization and its participants hold? How will intellectual property be treated?
- Who has the right to admit or terminate participants? What specific rights and responsibilities do participants have? Who is responsible for oversight of participants' activities, and on what grounds can participation be terminated?
- What are the specific rights and responsibilities of the board of directors (or trustees)? What protections are in place against the inappropriate centralization of power and authority?
- What aspects of the organization or its Constitution should be relatively easy to change? What should be difficult to change? Who has the right to make such changes, and what level of agreement should it take to do so? For example, what percentage of votes (by directors or members) are required to modify Purpose or Principles; change the classes or categories of participation; alter the composition of the board of directors; amend other Constitutional provisions; etc.?
- In what state should the organization be incorporated, to allow the concept to be most fully realized? This is a key decision, because state corporate laws differ, and the laws of some states are more favorable to chaordic organization that others. The decision concerning an appropriate jurisdiction should be made in conjunction with legal counsel with expertise in chaordic organization.
Prepare to undertake two or three revisions of a draft Constitution. Each draft should narrow the number of issues requiring careful thought and creative solutions, but new issues may arise along the way.
Process Notes
When work on a Constitution begins, the chaordic design process is nearing its conclusion. At this point, some participants will be eager to begin implementing the Organizational Concept, undertaking innovative activities to realize Purpose in accord with Principles. Occasionally there will be questions about whether a Constitution is really necessary, or about how much time and attention to give this phase of the process.
We believe it is essential that the design work be embodied in a legally binding agreement - and that it be done with legal counsel familiar with chaordic concepts.
Unless a sound and binding legal framework is established to reinforce the creative work done in conceiving a new organization, participants tend - despite their best intentions - to revert to more habitual forms of organizational behavior. In addition, unless established as a legal entity, the organization will be unable to engage in such basic acts as contracting, owning trade or service marks, acquiring other properties, making decisions, and innumerable other activities necessary to function effectively in pursuit of the Purpose.
Without experienced legal counsel, the work done in the earlier phases of the process will not be accurately represented in the Constitution. If you encounter constraints on some of the organizational innovations you might like to implement, lawyers experienced with chaordic organization are likely to be more helpful in finding creative solutions and ways to expand the perceived limits of current legal thought and practice.
Fundamentally, the Constitution provides a vehicle for self-organization, self-governance and a framework for cooperative action. It puts Purpose and Principles at the foundations of the organization and clearly articulates the work on Organizational Concept. It establishes the framework that allows the organization to evolve. Taking the time and incurring the expense to do it right will help minimize the likelihood of difficulties, including potential legal liabilities, as the Organizational Concept is implemented and the organization evolves.
What You Need
For Work On Constitution
- A small group of 2-4 individuals knowledgeable about the work to date who have been given responsibility seeing it embodied in the Constitution.
- Expert legal counsel familiar with chaordic concepts and experienced in writing legal documents based on them.
- Sharp analytical thinking skills.
- Sensitivity to nuances of the relationship between Principles and Organizational Concept as they are formally embodied in a legal framework for the organization.
- Commitment to ensuring that the Constitution fully embodies work done by the design team on Purpose, Principles, Participants, and Organizational Concept.
© 2001, Chaordic Commons, All rights reserved
