What Is the Purpose of a Charter?

A charter represents a document that describes a project, its rationale, its goals and its participants. The purpose of a charter aims at aligning the expectations of all the contributors so that their energy focuses on the project’s priorities.

In a business setting, the charter represents the first important milestone in the sequence of best practices of project management, writes Cornell University in its tutorial on project management methodology. Often called term of reference, business case or business plan, the document explains why the company should launch a project and the benefits that the organization will gain.

The document outlines the scope, the expected outcomes, a high-level summary of the steps to take, the budget required, the timeline and the names of the persons lined up to execute the plan, specifies Businessballs.com.

The charter typically summarizes a plan resulting from negotiations with participants, company leadership and customers or beneficiaries. The charter becomes the platform to resolve contentions between timeline for delivery, investment needed to complete the project and expected level of performance, often referred as product specifications. Once approved, the charter sets the expectations and accountability for everyone involved states PMtutor.net. Approval of the charter typically launches the project and triggers funding.