Project Charter

Project Charter refers to a statement of objectives in a project. This statement also sets out detailed project goals, roles, and responsibilities, and identifies the main stakeholders, and the level of authority of a project manager. It acts as a guideline for future projects as well as an important material in the organization's knowledge management system. The project charter is a short document that would consist of a new offering request or a request for a proposal. This document is a part of the project management process, which is required by the Initiative for Policy Dialogue (IPD) and Customer Relationship Management (CRM).[1]

A Project Charter is a formal, typically short document that describes your project in its entirety — including what the objectives are, how it will be carried out, and who the stakeholders are. It is a critical document in project management that authorizes the existence of a project and provides the project manager with the authority to use organizational resources for project activities.

Purpose and Role

The purpose of a project charter is to establish the existence of a project and to delegate authority to the project manager. It gives a clear understanding of the project, aligns the project with strategic objectives, and serves as a reference of authority for the future of the project.

The project charter plays a critical role as it is used as a reference for all future project decisions. It outlines the project objectives, identifies the stakeholders, and defines the authority of the project manager. It acts as a contract between the project sponsor, key stakeholders, and the project team.


The project charter generally contains the following information:

  1. Project Title and Description: This part typically includes the project name, a brief description of the project, and its purpose.
  2. Project Manager Assigned and Authority Level: The name, and possibly the job title, of the project manager along with the level of their authority.
  3. Business Case: Why the project is being done. This section provides reasons and justifications for the project.
  4. Stakeholders: The individuals or organizations who are involved in the project or whose interests may be affected as a result of project execution or project completion.
  5. Project Goals and Objectives: Defines what is to be achieved and the outcomes that are expected from undertaking the project.
  6. Project Scope: The work that needs to be accomplished to deliver a product, service, or result with the specified features and functions.
  7. Resources Assigned: This part includes a list of resources that will be assigned to the project.
  8. Risks and Issues: Early identification of major risks and issues that may have an impact on the project.


The project charter is important as it provides an understanding and agreement on the project’s objectives and scope, the stakeholders involved, and the project manager’s authority level. It also acts as a reference document throughout the project lifecycle.


The concept of a project charter as a guiding document for project managers was introduced with modern project management methodologies. In particular, the Project Management Institute's (PMI) guide to the Project Management Body of Knowledge (PMBOK) specifies the creation of a project charter as a key part of the project initiating process.


  1. Provides a clear direction and purpose for all project team members.
  2. Helps to prevent scope creep by clearly defining the project’s boundaries.
  3. Helps align the project with the strategic objectives of the organization.
  4. It gives the project manager the authority to proceed and commit resources to the project.


  1. If not adequately prepared, the project charter may be too vague or not encompass the entire scope of the project, leading to confusion.
  2. Sometimes, project charters are not taken seriously or are ignored, reducing their effectiveness.


For example, a company that wants to implement a new software system may create a project charter that includes the rationale for the change (the business case), the budget and resources available, the project's timeline, the project manager's name and authority level, and the main stakeholders involved in the project.

See Also

  • Project Management: The project charter is a key document in project management.
  • Stakeholders: These are the people involved in or affected by the project, as identified in the project charter.
  • Project Scope: This refers to the detailed set of deliverables or features of a project. The project scope is defined in the project charter.
  • Project Sponsor: This is typically a senior executive in the organization with the authority to assign resources and enforce decisions regarding the project. The project sponsor usually signs off on the project charter.
  • Business Case: This is the justification for the project, typically based on the estimated cost of development and implementation against the risks and the anticipated business benefits and savings to be gained. The business case is outlined in the project charter.
  • Team Charter
  • Project Dependencies
  • Project Life Cycle
  • Project Portfolio Management (PPM)
  • Project Portfolio Rationalization


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