What is a Project Charter: Definition and Examples

A Project Charter is a document that, while describing the purpose of a project and its scope, it legally authorizes the beginning of the project.

Any business nowadays, before initiating a new project requires a signed project charter.

If you are an investor or a contributor in a project, you want to get a clear understanding of what this project will bring about. After all, it is important to know what resources it requires before you sign for it – and that’s exactly what a project charter provides.

It clarifies general specifications, the purpose of the project, the key stakeholders, and the possible outcomes.

Originally, project charters have existed for more than a thousand years in different forms. Some such examples would be colonial charters issued by kings, the Magna Carta in the 13th century etc. Nowadays, they are an integral part of the project management due to their importance as a legally binding document.

What does a Project Charter contain?

Depending on company culture and on the person ahead of writing the company charter, the points that comprise it can vary.  Typically, however, it’s composed of the following sections:

Why do we need a Project Charter?

Companies can be extremely chaotic. “Who’s in charge of what? Why is the project delayed? Why did the servers just catch fire?”

Accordingly, a project charter can ensure that your project doesn’t succumb to the chaos of miscommunication and missed deadlines.

This is especially true for smaller companies or startups, where there’s no clear managerial hierarchy. In such a case, you could have 3 or more employees working on similar tasks and duties.

Let’s say, for example, you’re a fledgling software development startup with 3 back-end developer employees.

When working on small-scale projects, your developers can easily work independently and ask for each-others help when needed. Things, however, get more complex when working on a bigger project.

Out of the 3 developers, one will be selected to lead the project. Unless they decide to take the initiative and write out a project charter, the development process might get a bit chaotic…

So what happens next?

After 1 month of working together, the role of the “team leader” starts fading away. The developers start making changes to the database or the application logic without consulting with the leader. Consequently, the team spends countless hours of discussing the best approach to take, how to optimize it, why it should be changed, etc…

The bottom line is: the whole team starts to get lost, each employee alters each others’ work due to the unclear specification of each individual’s reach. The developers start having their own thoughts regarding the end product. Thus, contributing to more conflicting ideas and ultimately changing the scope of the project. Finally, the team can’t deliver on time because they are not completely aware of the required deliverables and the respective deadlines.

What would have been different if there was a Project Charter?


A project charter is not simply a document stating facts and information about a project. It serves as the groundwork for effectively communicating with stakeholders and for efficiently routing work between actors that take part in the project.

Having a good and complete Project Charter is the very first step in managing a project.

Or, you could even take it a step further and adopt workflow management software. It comes with all the benefits of a project charter, the added benefit of being able to track everyone’s work, deadlines, to-dos, etc. online. So, why not book a demo with Tallyfy?

Feel like we missed something? Do you have any experience with a project charter ending up being a life-saver? Let us know in the comments below!

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