There are a whole host of legal and practical issues to consider when a charity rebrands. Somewhere near the top of this list should be – does it need to change its legal name? Or is it sufficient just to adopt a new ‘working name’?

Mathew Healey outlines the pros and cons of each approach.

Why change your name?

It’s not unusual for a charity to rebrand.  This could happen for a number of reasons: a merger with another charity; aiming to reflect a change of purposes; simply looking to refresh how it is perceived by the outside world.

A key question is often: do we change the legal name of the charity; or are there advantages to simply adopting the new name as a working/operational name, whilst retaining the ‘old’ name for legal purposes?

Note that this blog doesn’t deal with issues around name selection and clearance as such.  However this is a key (possibly the key) legal consideration when it comes to rebranding.  You should also consider registering the new name as a trade mark – your Chartered Trade Mark Attorney should be able to help with both these points.

Practical steps

Inevitably, changing your legal name gives rise to administrative burden – and may also need buy-in from your membership. The exact process will depend on your legal form and the terms of your governing document.  For a charitable company the name change must usually be approved by a special resolution of your members – a 75% majority vote. For charities with a large membership, this is more likely to go smoothly if you have given your members due warning, and, where appropriate, involved them in the process.

Once the necessary resolution has been passed, you need to record this change at Companies House.  This is usually a simple process but bear in mind that, if someone else already has a company with the exact (or very nearly exact) same name as yours, you will not be allowed to register the change.  This will apply even if the existing company does something different from you (or indeed nothing at all): this is something we’d expect to pick up as part of the clearance process.

Last, bear in mind that it may be apposite to take a proposed rebrand to your membership even if you propose to retain the charity’s registered name ‘as is’.  There are all kinds of things to be considered here and there is no ‘one size fits all’ analysis.

Informing the Charity Commission

Once the registered name has been changed before Companies House, you will need to tell the Charity Commission about the change so that it can update the public record.  Again this is usually a formality but again, as touched on above, the Commission could refuse to record a name if it is too close to another’s.  The Commission is only interested in other charities though bear in mind that it has a broader conception of what makes two names too alike than Companies House.

Even if you choose not to change your registered name, it would still be advisable to record your new operating name as a ‘working name’ with the Commission. The main practical effect is that the working name shows up on a search of the Commission’s records – it is, in essence, something done for transparency’s sake, so that potential donors, service-users and anyone else can easily verify the Charity’s details.

The Commission applies similar criteria for entry of a working name on the Register of Charities as for a ‘main’ name – so if there are problems with a proposed main name, retaining the existing legal name and registering a working name may not be a solution.  There does not appear to be a specific compulsion on charities to tell the Commission about a change of operating name, but we think it is strongly advisable from a governance perspective.

Other administrative steps

If you change your legal name, there are various other administrative steps that you will need to consider.  It’s impossible to list all these here but the sort of things you’d need to think about include:

  • updating bank accounts with your new name (while, if your bank will allow it, retaining an account in the previous name to allow for paying in of cheques etc. made out in that name);
    • recording the change of name against various legal registers, such as the land registry and intellectual property registers; and
    • informing partners and others with whom you have a legal relationship and, if necessary, updating contracts.

However there are administrative considerations if you do not change too: for example, it is a legal requirement for websites, publications and letterheads to continue to bear the charity’s registered name, even if only in a footer. 

How might this affect legacies?

There should usually be no difficulty with a charity receiving a legacy made in favour of a former registered name.  Practical issues can arise if, for example, an executor fails to identify a charity from its former registered name. Former names are listed at both the Charity Commission and Companies House, which should reduce the risk of this happening.

One further note of caution: there is a set of standard ‘boilerplate clauses’ published by the Society of Trust and Estate Practitioners, which are often used by professionals drafting wills.  In their unaltered form, these feature a provision that ‘If any charity… changes its name… before the time that a gift to the charity takes effect …. the gift shall instead be paid to such charity as the [executors] decide having regard to the objects that were intended to benefit’.

This wording raises at least the possibility that, in some instances, a change of name may allow executors to direct a legacy elsewhere. We expect that this provision only applies where a charity’s legal name is changed (so it is, arguably, a factor in favour or retaining one’s registered name in the event of a rebrand).  We’re also hopeful that, in most cases, executors will not seek to interfere with the testator’s wishes and will simply pass the legacy to the renamed charity; but there are no guarantees, and the possibility of a very large legacy being re-directed is a real one.

Changed your mind yet?

Rebranding is a big decision for any charity, with all kinds of implications: this piece can only scratch the surface, and of course focuses on just one part of the picture (whether the charity’s registered name should be changed).  If you need assistance don’t hesitate to contact to get in touch with one of our in-house trade marks team at [email protected]