A New Constitutional Structure for the ASSC
Introduction
Since its inception over 30 years ago, the ASSC has been an ‘unincorporated association’ governed by its Constitution and an Executive Committee of its Members. In recent years, as we have grown and become more professional, this unincorporated status has started to become out of date and, at times, problematic. Therefore, we have been looking at how we move to become a ‘legal entity’ without losing the core ethos and guiding principles that underpin all that is the ASSC.
This would mean a change to the Constitution and the status of Members, and the Executive Committee has looked at several options. After careful research and consideration the Committee has decided to recommend a consortium co-operative limited by guarantee.
A Co-operative
The Co-operative movement has a long and proud history. The new ASSC co-operative company would be limited by guarantee, and operate as a members’ co-operative with the founding directors drawn from the existing executive committee.
Governing Documents
In this arrangement, the Constitution of the ASSC would be incorporated into a Members’ Operating Agreement and the Memorandum & Articles of the new company.
Members’ Operating Agreement
The Members’ Operating Agreement incorporates the key principles of the ASSC Charter. The Executive Committee has taken the opportunity to update some of the wording. It is this document that we would like all existing ASSC members to read, consider and comment on before the November AGM. Members are welcome to suggest further changes or amendments before the Agreement is ratified at the ASSC November AGM.
Memorandum & Article of Association
With the help of a consultant from the Co-operative Development Scotland/Scottish Enterprise, we have developed the Memorandum and Articles for the new company. These incorporate the ASSC constitution into a standard set of legal clauses which comply with the relevant company legislation.
The Memorandum and Articles will be lodged with Companies House to create the consortium co-operative company limited by guarantee. These can be altered at a future date, requiring a vote at a general meeting and formal notification to Companies House.
Proposal to ASSC 2016 AGM
The Committee believes this move is overdue and urgent, and will therefore propose a Resolution at the AGM in November 2016 to move to this new constitutional arrangement. The proposal would be to adopt an Operational Agreement, having consulted with the Members in advance, and to move to the new limited company and membership arrangements at the time of membership renewals on 1 February 2017.
In keeping with our history, and our potential future co-operative status, we sincerely want Members to support this move, and to raise concerns and suggest amendments to the draft Operating Agreement before it is formally proposed at the AGM. We aim to be open and clear in our communications, and do all we can to explain the proposals.
The Memorandum and Articles and the draft Members’ Operating Agreement are available to download from the ASSC website Members’ Area, and we invite all members to read and consider the documents, and feed back comments to the Committee.
Following consultation with the Members, and agreement at the November AGM, we propose to move to the new organisational membership arrangements at the time of membership renewals on 1 February 2017. On that date all existing members will be invited to join the new co-operative company and payment of the subscription will be taken as acceptance of the members’ agreement and membership of the new company. Every member will then have limited liability of £1 in the unlikely event of the company going bankrupt.
Opportunity for Change
In the course of drafting the new documents, the Committee took the opportunity to bring our Constitution up to date, and to make sensible changes for the future. The Operating Agreement and Articles are therefore not a simple verbatim copy of our current Constitution.
However, we know that most members would rather disinfect their dustbins or scrub the grease from a thousand ovens than read such documents in detail! The notes below are intended as a quick guide to the changes which have been incorporated into the new governing documents.
Members’ Operating Agreement
The following paragraphs are to be noted in particular:
3 – It is taken as understood that supporting and promoting quality standards may include a range of activities which it is not appropriate to require explicitly as an obligation of the organisation. These will change from time to time and may include running some form of QA scheme, providing training, handling complaints against members by visitors.
21 – The principle of ‘integrity’ has been added.
24 – To be a member it is a commitment to quality that matters, not membership of any specific scheme.
25 – Access to EmbraceScotland and other promotion and marketing opportunities provided by the ASSC would still require formal and active participation in an approved scheme.
The section in the Charter relating to the Green Tourism Business Scheme has not been carried through to the Agreement.
Download Member’s Operating Agreement:
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Remember – the Members Operating Agreement is not fixed in stone. The document can be altered at a future date and allows us to be flexible and respond to any future changes in the self-catering tourism sector.
Memorandum & Articles of Association
A company limited by guarantee limits the liability of members to a guarantee to contribute a maximum of £1 towards the assets of the company in the event of it being wound up. A members’ co-operative is run by, and for the benefit of, its members.
The development of a set of Memorandum and Articles for the new company was largely a technical exercise of incorporating the existing Constitution. The full text is available in the Members’ Area of the website.
The main differences between the Articles and the current Constitution are:
- There is no longer an Objective to create a profit or to develop overseas business.
- The ASSC would continue to have the ethos of a not-for-profit organisation. If surpluses are generated, they are first and foremost to be used to continue and develop the organisation. However, there is provision for payments for charitable purposes, and to members if approved at an AGM.
- Specialist ‘property managers’ have been added to those allowed into Agency membership.
- Admission to Membership is subject to also signing the Members’ Agreement.
- As it is no longer practical for the Committee/Board to vet every membership application, this is allowed to be delegated to ‘suitably qualified person appointed by the directors’.
- The requirement for an AGM is retained, but not that it be between specific dates.
- The quorum for General Meetings has been changed from 15 members to 5% of the membership.
- The provision for members to appoint a proxy to act on their behalf at meetings and the limit on the number of proxies that any one member may hold.
- A Board of Directors will replace the Executive Committee. This section lays out exactly how these Directors are elected and governed, including:
- There shall be a maximum of 15 and a minimum of 5
- The third of the Directors who have served longest shall retire each year at the AGM, but will be eligible to be re-elected immediately.
- The Directors shall elect a Chair from among them, as opposed to the current situation where the AGM elects the Chair.
- This rule allows for Directors to be paid for being a Director, which is simply not mentioned in the current Constitution.
- On winding up, it is not assumed that assets will be distributed amongst Members, but this is permissible if an ordinary resolution decrees.
Download the Memorandum and Articles:
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