•     •   14 min read

Ultimate Guide to Project Charter: Definitions, Creation, and Examples

A project char­ter is a fun­da­men­tal doc­u­ment in project man­age­ment. It is the for­mal autho­riza­tion for the exis­tence of a project and the road map for its exe­cu­tion and con­trol. The char­ter serves as both a direc­tive and a con­tract. It facil­i­tates the project man­ager’s author­i­ty to allo­cate orga­ni­za­tion­al resources to project activities.

A Project Char­ter (PC) explains the direc­tion your orga­ni­za­tion is tak­ing and why,
what will change, and what risks will arise. 

Cre­at­ing a project char­ter is a fun­da­men­tal step that aligns with the best prac­tices out­lined by the Project Man­age­ment Insti­tute (PMI). For pro­fes­sion­als who are cer­ti­fied as a Project Man­age­ment Pro­fes­sion­al (PMP), the cre­ation of a project char­ter is an essen­tial skill set. This PMI cer­ti­fi­ca­tion ensures that project man­agers can apply glob­al project man­age­ment stan­dards, includ­ing the stan­dards for ini­ti­at­ing and sched­ul­ing projects. 

This doc­u­ment not only con­tains basic infor­ma­tion, but also reflects the over­all vision of the stake­hold­ers. The project char­ter is usu­al­ly cre­at­ed at the ear­li­est stage of the project, before the project team (PT) is formed. It is typ­i­cal­ly writ­ten in col­lab­o­ra­tion with oth­er project par­tic­i­pants and sub­mit­ted to stake­hold­ers for final review. The char­ter is signed by the spon­sors in most cases.

Defin­ing the Project Charter

What is a Project Char­ter in Project Management?

The project char­ter def­i­n­i­tion encom­pass­es a for­mal doc­u­ment that not only defines the scope, objec­tives, and par­tic­i­pants of a project but also serves as a foun­da­tion­al tool in the project man­age­ment process. This essen­tial doc­u­ment out­lines the pro­jec­t’s goals, key stake­hold­ers, bud­get, sched­ule, and over­all direc­tion, pro­vid­ing a crit­i­cal frame­work for guid­ing the pro­jec­t’s exe­cu­tion and management.

The char­ter autho­rizes the project man­ag­er to use orga­ni­za­tion­al resources to achieve the objec­tives and is typ­i­cal­ly approved at the begin­ning of the project life­cy­cle. It is bet­ter to fit all the infor­ma­tion into a max­i­mum of 1 – 2 pages.

For exam­ple, the project char­ter can look like a text doc­u­ment, a Google doc, or a pre­sen­ta­tion. You can also use a project man­age­ment sys­tem with the pos­si­bil­i­ty of spec­i­fi­ca­tion of the project char­ter in the description.

Project descrip­tion on the Work­sec­tion project dashboard

What does the PC clarify?

  • What kind of pro­fes­sion­al becomes a Project Man­ag­er (PM) and what are his/​her responsibilities?
  • The pur­pose of the project and its rela­tion­ship to busi­ness metrics
  • Who approves and funds the project
  • The com­po­si­tion of the project team, the require­ments and expec­ta­tions of the project, and the respon­si­bil­i­ties of each participant
  • Cri­te­ria for success

Project Char­ter vs. Project Plan

The project char­ter is cre­at­ed in the ear­ly stages of a project to broad­ly define the vision and scope of the project. It includes high-lev­el project details such as objec­tives, key stake­hold­ers, and the project man­ager’s lev­el of author­i­ty. Con­verse­ly, a project plan is devel­oped after the project char­ter and pro­vides detailed infor­ma­tion on how the project will be exe­cut­ed, mon­i­tored, and closed. The project plan includes detailed sched­ules, resource allo­ca­tions, risk man­age­ment plans, and com­mu­ni­ca­tion plans.

The project char­ter sets the strate­gic frame­work for a project and pro­vides a macro view of the nec­es­sary ele­ments for project ini­ti­a­tion. In con­trast, the project plan serves as a tac­ti­cal guide that man­ages the exe­cu­tion phase of the project, focus­ing on the oper­a­tional details and logis­tics of project management.

The rela­tion­ship between the project char­ter and the project plan is syn­er­gis­tic, as the clar­i­ty and direc­tion pro­vid­ed by the char­ter direct­ly influ­ences the detailed plan­ning and ulti­mate suc­cess of the project. The char­ter pro­vides ini­tial align­ment with the orga­ni­za­tion’s strate­gic goals, while the plan oper­a­tional­izes those goals into action­able steps, sched­ules, and resource plans. 

Pur­pose of a Project Charter

Three crit­i­cal risks under­line the impor­tance of hav­ing a well-draft­ed project char­ter, which can make or break the suc­cess of a project:

  1. Lack of Author­i­ty and Resources: With­out a project char­ter, the project man­ag­er may face sig­nif­i­cant hur­dles in exert­ing author­i­ty and secur­ing nec­es­sary resources. The char­ter serves as an offi­cial doc­u­ment that gains stake­hold­er approval, essen­tial­ly grant­i­ng the project man­age­ment the man­date to oper­ate with­in defined para­me­ters. This approval is cru­cial as it sup­ports the project man­ag­er in acquir­ing the nec­es­sary resources and author­i­ty with­out hav­ing to con­stant­ly nego­ti­ate or jus­ti­fy each deci­sion, thus pre­vent­ing delays and disruptions.
  2. Unclear Project Expec­ta­tions: A project with­out a char­ter risks hav­ing neb­u­lous goals, lead­ing to scope creep — a sit­u­a­tion where the pro­jec­t’s goals expand beyond the orig­i­nal plans with­out prop­er con­trol. A char­ter out­lines the project’s objec­tives and deliv­er­ables clear­ly, set­ting a defined path and expec­ta­tions from the out­set. This clar­i­ty helps in main­tain­ing focus and align­ing the project team’s efforts with the pre­de­fined out­comes, there­by reduc­ing the like­li­hood of project sprawl and mis­aligned deliverables.
  3. Mis­align­ment with Orga­ni­za­tion­al Goals: Projects ini­ti­at­ed with­out a char­ter may inad­ver­tent­ly stray from or con­tra­dict the broad­er orga­ni­za­tion­al goals. A well-con­struct­ed char­ter links the project to the organization’s strate­gic objec­tives, explain­ing how the project con­tributes to the over­all busi­ness strat­e­gy. This align­ment is cru­cial for secur­ing ongo­ing sup­port from upper man­age­ment and ensur­ing that the project con­tributes pos­i­tive­ly to the company’s long-term success.

Key Com­po­nents of a Project Charter

📍Project Objec­tives and Constraints

A project char­ter out­lines the pri­ma­ry objec­tives of the project, spec­i­fy­ing the desired out­comes that align with broad­er orga­ni­za­tion­al goals. It also details the con­straints or lim­i­ta­tions with­in which the project must oper­ate, such as bud­get lim­its, time con­straints, resource avail­abil­i­ty, and spe­cif­ic scope bound­aries. The artic­u­la­tion of both goals and con­straints in the char­ter is crit­i­cal. This dual focus guides every phase of the project life­cy­cle, from plan­ning through exe­cu­tion, ensur­ing that the project stays on track while effi­cient­ly man­ag­ing resources and stake­hold­er expectations. 

Set­ting clear objec­tives pro­vides the project team with a mea­sur­able stan­dard against which to mea­sure progress and suc­cess, while con­straints help ensure that the project does not over­reach and remains focused on essen­tial deliv­er­ables. Togeth­er, these ele­ments frame a strate­gic approach that is crit­i­cal to align­ing the project with the over­all strate­gic direc­tion of the orga­ni­za­tion, facil­i­tat­ing effec­tive deci­sion-mak­ing and project man­age­ment practices.

⏲️Project Timeline

The project time­line is an essen­tial com­po­nent of the project char­ter. It details the start and end dates of the project and maps out key mile­stones and dead­lines. The inclu­sion of a time­line in the project char­ter helps in set­ting a clear sched­ule that all project par­tic­i­pants can fol­low. It serves as a tool for mon­i­tor­ing progress and ensures that the project remains on track to meet its defined objec­tives with­in the allo­cat­ed time. Effec­tive time­lines are not just sched­ules; they are strate­gic tools that help man­age resources, adjust pri­or­i­ties, and mit­i­gate poten­tial delays or risks.

🙋Key Stakeholders

Iden­ti­fy­ing key stake­hold­ers in the project char­ter is cru­cial for project suc­cess. Stake­hold­ers typ­i­cal­ly include any­one impact­ed by the project or those who have influ­ence over the project out­come. This group might include project spon­sors, team mem­bers, cus­tomers, end-users, or exter­nal sup­pli­ers. The char­ter should explic­it­ly define the roles, respon­si­bil­i­ties, and expec­ta­tions of each stake­hold­er to fos­ter trans­paren­cy and accountability. 

Under­stand­ing who the stake­hold­ers are and their respec­tive stakes in the project is essen­tial for devel­op­ing tai­lored com­mu­ni­ca­tion and project man­age­ment strate­gies that sup­port col­lab­o­ra­tive and effec­tive project exe­cu­tion. Pre­cise­ly iden­ti­fy­ing these stake­hold­ers ensures that all nec­es­sary inputs are con­sid­ered and that the project address­es all rel­e­vant inter­ests and require­ments, which is crit­i­cal for achiev­ing the desired out­comes and ensur­ing project align­ment with broad­er busi­ness objectives.

⚠️Iden­ti­fied Risks

The project char­ter must antic­i­pate and out­line poten­tial risks that could impact the pro­jec­t’s tra­jec­to­ry from its out­set. These risks might include bud­getary con­straints, time­line delays, tech­no­log­i­cal fail­ures, resource avail­abil­i­ty, or exter­nal fac­tors such as reg­u­la­to­ry changes. Doc­u­ment­ing these risks is cru­cial as it pre­pares the project team to han­dle chal­lenges proac­tive­ly. Effec­tive risk iden­ti­fi­ca­tion helps in devel­op­ing mit­i­ga­tion strate­gies that can be imple­ment­ed should these risks mate­ri­al­ize, ensur­ing that the project remains on track towards its objectives.

✅Project Benefits

The project char­ter should clear­ly artic­u­late the ben­e­fits expect­ed from com­plet­ing the project. These ben­e­fits often align with strate­gic busi­ness goals and can include increased effi­cien­cy, cost sav­ings, enhanced cus­tomer sat­is­fac­tion, or com­pet­i­tive advan­tages. High­light­ing these ben­e­fits is essen­tial not only for jus­ti­fy­ing the pro­jec­t’s ini­ti­a­tion but also for main­tain­ing stake­hold­er engage­ment and sup­port through­out the project life­cy­cle. It pro­vides a clear vision of what the orga­ni­za­tion aims to achieve, serv­ing as a con­tin­u­al ref­er­ence point for the pro­jec­t’s val­ue proposition.

🧮Bud­get Overview

The bud­get sum­ma­ry in a project char­ter is crit­i­cal to estab­lish­ing the finan­cial frame­work for a project. This sec­tion not only pro­vides a detailed esti­mate of the funds need­ed to cov­er all expect­ed costs-such as labor, mate­ri­als, tech­nol­o­gy, and con­tin­gen­cies-but also antic­i­pates poten­tial finan­cial over­runs and includes plans for such instances. 

In defin­ing these finan­cial para­me­ters, the project char­ter helps stake­hold­ers under­stand the eco­nom­ic fea­si­bil­i­ty and resources required, facil­i­tat­ing bet­ter invest­ment deci­sions and finan­cial over­sight. This com­pre­hen­sive finan­cial out­line ensures that all project par­tic­i­pants are aware of the cost impli­ca­tions and finan­cial respon­si­bil­i­ties, which is crit­i­cal to main­tain­ing trans­paren­cy and pre­vent­ing bud­get over­runs, there­by ensur­ing the finan­cial via­bil­i­ty of the project.

Craft­ing a Project Charter

Step-by-Step Guide to Cre­at­ing a Project Charter

Step 1 Under­stand key project goals and objectives

Start by clear­ly defin­ing what the project aims to achieve. Engage with key stake­hold­ers to gath­er insights and expec­ta­tions. List 3 – 5 small­er goals to be accom­plished as the project pro­gress­es. Make sure they are spe­cif­ic, mea­sur­able, achiev­able, rel­e­vant, and time-bound. In oth­er words, they are SMART.

Ana­lyze how the project may affect the orga­ni­za­tion’s busi­ness performance.

Step 2 Define project organization

Out­line the struc­ture of the project team and iden­ti­fy roles and respon­si­bil­i­ties. This includes spec­i­fy­ing who the project man­ag­er is, defin­ing the roles of team mem­bers, and estab­lish­ing the hier­ar­chy and com­mu­ni­ca­tion chan­nels with­in the team. Clar­i­fy­ing this ear­ly helps pre­vent con­fu­sion and sets the frame­work for account­abil­i­ty and author­i­ty with­in the project.


Work­sec­tion pro­vides you with a clear struc­ture of who is involved in a project, allow­ing you to eas­i­ly orga­nize work­ing with­in a team as well as with clients and freelancers.

Step 3 Cre­ate an imple­men­ta­tion plan

Devel­op a detailed plan that out­lines how the project objec­tives will be achieved. This should include the phas­es of the project, key activ­i­ties, mile­stones, and dead­lines. The imple­men­ta­tion plan should also detail the resources required for each stage of the project, includ­ing time, bud­get, and human resources.

Step 4 List poten­tial prob­lem areas

Per­form a risk assess­ment to iden­ti­fy poten­tial prob­lems such as resource allo­ca­tion, delayed sched­ules, or exter­nal depen­den­cies. Out­line mit­i­ga­tion strate­gies for these risks. This proac­tive approach not only pre­pares the team to han­dle dif­fi­cul­ties. It also demon­strates thor­ough plan­ning and foresight.

Post-Cre­ation Steps

The next steps in mov­ing a project from plan­ning to exe­cu­tion are crit­i­cal after the project char­ter is cre­at­ed. These steps after the cre­ation of the project char­ter ensure that the project is for­mal­ly approved and that the scope of the project is clear­ly defined and agreed upon by all stakeholders.

Step 1 Autho­rize the project

The first step after the cre­ation of the project char­ter is to obtain for­mal approval for the project. This is typ­i­cal­ly the review and approval of the project char­ter by key stake­hold­ers such as project spon­sors, senior man­age­ment, or the project board. 

Approval serves as an offi­cial green light that the project is aligned with strate­gic goals and has the nec­es­sary back­ing in terms of resources and exec­u­tive sup­port. It also autho­rizes the project man­age­ment to allo­cate resources and make nec­es­sary project-relat­ed decisions.

Step 2 Devel­op a scope statement

The devel­op­ment of a detailed scope state­ment is crit­i­cal once the project is approved. This doc­u­ment pro­vides a more detailed descrip­tion of the pro­jec­t’s deliv­er­ables, bound­aries, and accep­tance cri­te­ria, build­ing on the ini­tial scope out­lined in the project charter. 

To pre­vent scope creep, the scope state­ment should clear­ly state what is includ­ed and what is exclud­ed from the project. It also pro­vides a clear ref­er­ence that stake­hold­ers can agree on and helps define the cri­te­ria for what con­sti­tutes project success.

Enhanc­ing Your Project Charter

Tips for Effec­tive Project Charters

Cre­at­ing an effi­cient and con­cise project char­ter is cru­cial for set­ting the stage for a suc­cess­ful project. Here are some prac­ti­cal tips to enhance the qual­i­ty and effec­tive­ness of your project charters:

💡Insights from your team

Include feed­back and insights from team mem­bers who will be direct­ly involved in the project. Ear­ly engage­ment with your team can pro­vide valu­able per­spec­tives that improve the rel­e­vance and fea­si­bil­i­ty of the char­ter. It ensures that the char­ter reflects a com­pre­hen­sive under­stand­ing of the pro­jec­t’s require­ments and chal­lenges from those who will be exe­cut­ing it.

🖊️Keep­ing it concise

A con­cise project char­ter is more effec­tive and eas­i­er to use. Focus on includ­ing only essen­tial infor­ma­tion such as project objec­tives, key stake­hold­ers, key risks, and scope. There should be no over­load­ing of the doc­u­ment with too much detail, which can be reserved for the project plan. Use clear and direct lan­guage to help stake­hold­ers quick­ly under­stand what the project aims to accom­plish and how to participate.

📋Cre­at­ing a template

Devel­op a stan­dard­ized tem­plate for your project char­ters to stream­line the cre­ation process for future projects. A tem­plate ensures con­sis­ten­cy in how infor­ma­tion is pre­sent­ed and makes it eas­i­er for stake­hold­ers to find rel­e­vant details. Include sec­tions that cov­er all crit­i­cal aspects of a project char­ter, and cus­tomize the tem­plate as nec­es­sary based on lessons learned from past projects.

💻Tools and Soft­ware for Project Charter

Using the right tools and soft­ware is crit­i­cal to improv­ing the cre­ation and man­age­ment of project char­ters. Work­sec­tion is an exam­ple of a project man­age­ment soft­ware with fea­tures tai­lored to the devel­op­ment and main­te­nance of project charters. 

This plat­form facil­i­tates col­lab­o­ra­tive project cre­ation, sim­pli­fies updates, and inte­grates with oth­er project man­age­ment tools. It stream­lines process­es by allow­ing team mem­bers to work togeth­er on doc­u­ments in a seam­less man­ner, ensur­ing con­sis­ten­cy and accu­ra­cy through­out the entire doc­u­men­ta­tion of the project. In addi­tion, Work­sec­tion pro­motes trans­paren­cy and effec­tive com­mu­ni­ca­tion by cen­tral­iz­ing all project-relat­ed doc­u­ments in a sin­gle, acces­si­ble loca­tion, so that each team mem­ber has instant access to all project documents. 

This is crit­i­cal for main­tain­ing align­ment and facil­i­tat­ing time­ly deci­sion-mak­ing with­in project teams, ensur­ing that each team mem­ber has instant access to the lat­est updates and information.

Project Char­ter Tem­plates and Exam­ples in Worksection

You can add a project char­ter in Work­sec­tion using the Project Descrip­tion fea­ture. For that pur­pose, go into the project settings:


The next step is to fill in the required infor­ma­tion and save the data. You can also attach a Project Char­ter file direct­ly to the Descrip­tion to make sure the team can access the infor­ma­tion needed. 

Project char­ter template

Here’s a basic tem­plate with infor­ma­tion what does project char­ter include. You can cus­tomize accord­ing to your pro­jec­t’s spe­cif­ic needs:

  1. Project Title: Pro­vide a con­cise title that reflects the nature of the project.
  2. Project Spon­sor: Name and depart­ment of the per­son who is spon­sor­ing the project.
  3. Project Man­ag­er: Name and con­tact infor­ma­tion of the indi­vid­ual respon­si­ble for man­ag­ing the project.
  4. Objec­tives: Clear­ly defined goals that the project aims to achieve.
  5. Scope: Out­line what is includ­ed and exclud­ed in the project. Spec­i­fy the bound­aries to clar­i­fy where the project begins and ends.
  6. Key Stake­hold­ers: List the main indi­vid­u­als or groups inter­est­ed in the out­come of the project and their roles.
  7. Mile­stones: Major mile­stones and their expect­ed com­ple­tion dates.
  8. Resources: Sum­ma­ry of the bud­get and oth­er resources allo­cat­ed to the project.
  9. Ben­e­fits: Describe the antic­i­pat­ed ben­e­fits of com­plet­ing the project.
  10. Sign-off: Sig­na­tures of the project spon­sor, project man­age­ment, and key stakeholders.
  11. Appen­dices: Any addi­tion­al infor­ma­tion nec­es­sary for under­stand­ing the project, such as detailed bud­get break­downs or tech­ni­cal specifications.

Exam­ple of a project char­ter in Worksection

This is how you can cre­ate project char­ter using the tem­plate in Worksection:

FAQs about Project Charters

1️⃣Who should draft the project charter?

The project char­ter is ide­al­ly writ­ten by the project leader with input from the project par­tic­i­pants, incor­po­rat­ing all vital project char­ter ele­ments. This col­lab­o­ra­tive approach ensures that the char­ter cov­ers both the strate­gic vision of the orga­ni­za­tion and the prac­ti­cal aspects of project exe­cu­tion com­pre­hen­sive­ly. Senior project man­age­ment or the project spon­sor’s involve­ment is cru­cial in giv­ing the char­ter the nec­es­sary author­i­ty and ensur­ing it aligns with broad­er busi­ness objec­tives, mak­ing these ele­ments essen­tial to the suc­cess and orga­ni­za­tion­al align­ment of the project.

2️⃣Can the project char­ter be edit­ed through­out the project lifecycle?

Yes, the project char­ter may be sub­ject to updates dur­ing the project life cycle, although such changes should gen­er­al­ly be min­i­mal. Sig­nif­i­cant changes in scope, resources, or objec­tives may require revi­sions. To main­tain clar­i­ty and con­sen­sus on the pro­jec­t’s direc­tion, any changes should be made with the agree­ment of key stake­hold­ers and for­mal­ly documented.

3️⃣Best prac­tices for pre­sent­ing the project char­ter to the team

Pre­sent­ing the Project Char­ter effec­tive­ly means clear­ly com­mu­ni­cat­ing its key com­po­nents to ensure that all team mem­bers under­stand the scope of the project, what it’s try­ing to accom­plish, and their indi­vid­ual roles with­in the project. Best prac­tices include:
  • Hold a kick­off meet­ing: Give team mem­bers the oppor­tu­ni­ty to ask ques­tions and clar­i­fy their under­stand­ing by review­ing the char­ter in detail at this meeting.
  • Use visu­al aids: More com­plex aspects of the char­ter, such as time­lines and depen­den­cies, can be illus­trat­ed with charts, graphs, and slides.
  • Dis­trib­ute copies: Make sure that every mem­ber of the team has access to the char­ter, prefer­ably in a for­mat that they can refer to through­out the project.
  • High­light key points: High­light crit­i­cal ele­ments such as mile­stones, key deliv­er­ables, and the esca­la­tion path for issues.
  • Encour­age feed­back: Allow team mem­bers to pro­vide input on the char­ter, which can help iden­ti­fy poten­tial prob­lems ear­ly and engage the team in the pro­jec­t’s success.
These steps can sig­nif­i­cant­ly improve team engage­ment and project out­comes by fos­ter­ing a trans­par­ent and inclu­sive approach to project plan­ning and execution.

Con­clu­sion

A Project Char­ter is a doc­u­ment that lists the key objec­tives of the project, defines who’s involved, and estab­lish­es cri­te­ria for suc­cess. By estab­lish­ing author­i­ty and cer­ti­fy­ing the avail­abil­i­ty of nec­es­sary resources, the char­ter is impor­tant to the project man­ag­er and team.

New oppor­tu­ni­ties and poten­tial risks, method­ol­o­gy, bud­get, and sched­ule are dis­closed in this doc­u­ment. The char­ter must demon­strate the pro­jec­t’s ben­e­fits to the organization.

With­out an up-to-date char­ter, the project man­ag­er and team mem­bers risk an ongo­ing bat­tle for influ­ence and fund­ing. Not hav­ing one can also cause the project to get bogged down.

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