CIC Association

Serving Community Enterprise



Is anyone else frustrated by the fact that CICs with only 2 directors cannot apply for Lottery and Children in Need funding?


I would have thought that the asset lock would be assurance that the money will not be used unwisely.


Someone suggested that the Lottery is worried that 2 directors does not give a broad enough range of management experience, but in the commercial world a partnership can get finance.


However, the Lottery seems such a huge institution it might be hard to change their views.


Anyone else have views on this?

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Don't understand this post - as I know that the Heritage Lottery funding do accept applications from CIC's with two directors anyway!

There are stricter guidelines for the other lottery funds but may I suggest that in these situations you simply call on your committee members - if you have any, to act as treasurer eg, which might help with such.

I don't think it's that they don't trust CIC's with 2 directors, more that they want to see a wider management and this can be achieved by recruiting committee members to your organisation - rather than additional directors. Try it; it might just help.

Hi Terri,


Since posting this last year, I have discovered (partly thanks to previous replies) that you don't necessarily have to take on extra directors, but an unrelated commitee member signatory to the bank account will suffice in some cases. This is not the advice I was originally given on the Lottery helpline, who told me twice that we would need another director. Once I was aware of this, I came across other funders who initially said they needed 2 or 3 unrelated directors, but when questioned they just wanted an unrelated signatory which could be a committee member.

We've also found another way round this is to become part of a funding group, with one 'lottery friendly' organisation applying for funding to be distributed among groups (such as ourselves) delivering the service. Takes some enthusiastic organising, but can be very useful.

Hi Debbie,


This is really interesting as I'm starting out on the funding route at the moment and coming across exactly these dilemmas. Re. becoming part of a "funding group", would you say that this applies to say "partnership funding" with larger organisations/ establishments such as other social enterprises/ charities? Bearing in mind the current climate is pushing towards this kind of work and collaboration it would be wise for them to accept this but then gawd knows what they're thinking...


Did you get the info you posted above in writing??? Just wondering if there is something I could refer to when trying to do the same.


Also, can anybody suggest or give info about adding another unrelated committee member signatory to your CIC? How do you go about this?


Many Thanks!


My suggestion Debbie (although I haven't tested this) is to appoint a non executive director; someone who sits on your board to provide advice, but who does not get involved in the day to day running of the business. You could however, appoint them as a signatory for grant applications.


Best wishes


Yes, we are in a very similar situation in that we are three directors two of whom are married (to each other) so they are related, and BIG guidance says there must be three unrelated directors. Does seem over the top but not much we can do about it so we are now looking to recruit another director.

Yes, it is a situation where those who do not know better, think that having unrelated people is a safer bet.

Possibly for either overall experience brought to the company, which in theory will help the business, or, that it will reduce the risk of some kind of shenanigans.

However, the waste, incompetence, greed, tax evasion and huge directors bonuses in companies with UNRELATED Directors, tells a different story.

This seems to have changed quite recently, as Awards for All were quite happy to fund us in 2011 with 3 directors- two of which were related.

A recent application for another project was turned down as we needed three unrelated directors, we were told. 

A case of goalposts and rather a lot of movement... are they trying to hang onto money these days? I thought that they were desperate for applications?!

Just come across this problem has anyone an update? and how easy is it to add a non executive director to your team and is their any legal costs etc along the way ?

Hi Robert

They still require 3 directors. It is normally pretty easy to add a director, just look through your articles of association to refresh yourself on the procedure (normally in section 9)



Thanks R

Hi, I'm the original poster, and in the end we did take on a third director, as we wanted to apply for capital funding. We chose a longstanding volunteer / committee member who was happy to take a back seat in the day to day running. (and yes it was worth it - we got £50,000)

Thanks R



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