- Practicalities of election voting
- Board diversity
- Who decides what?
- What are the downsides of this model?
- How do we balance transparency with simplicity?
- Does anyone have too much power?
- Why have two boards?
- What is the Shakers Community set up to achieve?
- How did you price the membership fee?
- What if I want to invest more money?
- How do I become a Member and claim my Membership Share?
- What terms apply to Membership Shares
- Who can be a Member Shareholder?
- How is the club and its assets protected?
- How is the club structured?
- What is a Community Benefit Society?
Practicalities of election voting
Whilst each full (i.e. over 16) Shakers Community member will be allowed to vote once, you will be allowed to vote for multiple candidates up to a maximum of nine, which is the maximum board number.
You do not need to select nine options; you might only want to select one. Once you have voted, however, you cannot amend your vote as the system will lock you out of your unique login. As a result you are advised to read the personal statements here in advance of voting to allow you to make your choice.
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Our Election Policy does not set any minimum requirements in terms of board diversity; however, we acknowledge that as a community club this should be a concern to us. This is something for the new Shakers Community board to consider but we do have a recommendation which aims to ensure that different groups are represented and have direct access to the Shakers Community board, not simply on the basis of gender or ethnicity but also working to support our disabled fans and others who may need specific consideration.
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Who decides what?
One of the more difficult decisions the Shakers Community board will make ongoing is deciding what will be put to a member vote. It is impossible to provide a definitive list as to everything which will be voted on by members as circumstances will throw up different issues and options. There are a small number of items included in our Rules which must be voted on by members, including amendments to the rules or winding up the club. Some issues are emotionally important for fans and relatively easy to vote on. For example, we decided to put the choice of away kit colours to a member vote as we have had the time to do this. More importantly, we will put anything which will put the club at risk or determine its long-term future to a member vote. For example, taking on debt e.g. a bond raise as AFC Wimbledon have done recently, diluting equity to sell to private investors as some clubs have done, or the purchase of a ground.
We fully appreciate that fans will have different opinions on what should and shouldn’t be voted on. We have already stated that the first team manager, who will be one of the key appointments to be made by the Bury AFC board, will not be voted for by members. Retaining the support of the highly experienced Football Supporters’ Association will be important as we try to strike the right balance.
We have outlined the limits to the decision that the Bury AFC team can make, and the parameters of their decision-making will be defined further by the Shakers Community board. Members are being asked to elect the board members of the Shakers Community who will shape the governance structure of the club and, indeed, may decide to take a different view to the people who have run it in an interim capacity ahead of the first election. We want to stress that the work done to date is not sacrosanct and can be changed provided the correct process is followed. It is important that it evolves over time.
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What are the downsides of this model?
There is no guarantee that group decisions will always be correct, even if we do know they will be well intentioned. On the pitch success is dependent on a large dose of luck, and we will make mistakes along the way.
One problem with any organisation with multiple people involved is that it can be difficult to make a quick decision. Quick decisions will always be required to run the day-to-day operations of the club and indecision could be a weakness. This is one reason why we have decided to devolve responsibility for these decisions to the Bury AFC board with oversight from the Shakers Community board.
We do not have a wealthy benefactor pumping money into the club, but we don’t really need that for playing staff right now. The membership subscriptions and sponsorship packages already agreed to date will make us a significant club in non-league football. One misconception is that our model does not allow for any private ownership. The members can vote to dilute their shareholding down from 100% and this provides an opportunity in future to raise more capital if required. There will always be concerns that a fan-owned club will be overly conservative, non-commercial or unambitious, but we have seen no evidence of that so far. Ultimately, Bury AFC should reflect the aims and culture of the members who own it, as they have the power to influence the direction of travel.
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How do we balance transparency with simplicity?
We want to be transparent, but we do know that it’s also possible to blind people with too much detail. The detail will be available for those who want it, but we don’t expect all members to understand and interpret the nuances of the financial accounts of the club for example.
For this reason, we want to establish a series of board committees which will include an independent chair from outside the club who can provide expert input and commentary on a specific area. Neil Le Milliere, for example, is the independent chair of the Elections Committee overseeing the Shakers Community board elections as he has overseen many elections and is independent of Bury AFC. We hope this approach will give some comfort to those fans who do not want to get actively involved in the detail but would like some assurance that the club is being run in the right way. We will do the same with other areas such as financial reporting, and all results will be made available for inspection.
We have also consulted, and will continue to consult, with the Football Supporters’ Association, who have been incredibly supportive at every step. They are the expert body overseeing fan ownership. Everything we have described here has been developed in conjunction with them.
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Does anyone have too much power?
Bury fans will always worry about a repeat of the problems of the recent past. To prevent this we are not relying on ‘due diligence’ processes which can always fail, there are structural differences in how Bury AFC is constituted and run which are designed to stop any one individual from making decisions which are not in the long-term interests of the club.
The Bury AFC club chair, for example, does not have the same authority as a traditional chair who is typically also the owner of the club and free to make any decision they wish. At other fan-owned clubs the role is sometimes described as General Manager or in a business context the Managing Director, which perhaps conveys the difference better. The Bury AFC chair will be responsible for assembling and managing the team of people responsible for the day-to-day operation of the club, including the manager, but the Shakers Community board will have the ultimate say in this matter through its ability to veto any appointments. The Bury AFC chair must agree the annual budget with the Shakers Community board, and cannot take on debt, move ground or take any of the decisions which would put the club in jeopardy.
Remember also that the Shakers Community is a not-for-profit Community Benefit Society, authorised by the Financial Conduct Authority, and has adopted a specific rule called an ‘asset lock’. This means that none of the club’s assets can be taken without a member vote. If we wanted to sell some shares or property, we would need to agree it via a member vote. They can’t legally be transferred without this. There is no profit motive for anyone to do harm to the club.
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Why have two boards?
At the simplest level we have two boards because we have two companies. The first is the football club, Bury Football Club (2019) Ltd, trading as Bury AFC. The second is Shakers Community Society Ltd which is the holding company which owns Bury AFC. We explain why we have two companies in this FAQ but essentially it is to give us scope to raise funds in different ways, which we might need if, for example, we want to purchase Gigg Lane and also because the EFL rules do not allow for membership of a Community Benefit Society, which is how Shakers Community Society Ltd is structured. These might not be issues in the future and we may be able to simplify our current model.
We split the functions of the two boards so that the Shakers Community board is responsible for the governance of the club and its long-term strategy and safety, as it ultimately owns and controls the football club. The Shakers Community board will sign off on the football club’s budget and approve any key appointments within the club.
The board of the football club itself will be comprised of people who have more day-to-day, operational roles within the club. It became clear from discussions with other clubs that these roles and the people in them will change considerably over time. The advice we received was to retain as much flexibility as possible to cater for this. For this reason, we felt it was impractical to have the roles within the football club voted on by members as they will change and it was better for the Shakers Community board to have oversight of any key appointments. We have already adopted a team approach to jobs where possible. So whilst we are required to have certain roles which come with set job titles for FA purposes, there are several people working alongside the people in those roles. For example, in addition to the club secretary, we have other volunteers participating in FA courses on player registration, safeguarding and discipline, as well as training on the FA online systems.
The Bury AFC board will always include at least one Non-Executive Director from the Shakers Community board who will observe those board meetings on behalf of members.
We need to ensure that we have a proper succession plan in place for all roles so that the club continues as seamlessly as possible. Running the club with volunteers makes this especially important, as we want to share the burden as fairly as possible. We currently anticipate bringing in a small number of salaried people for specific roles as required e.g. first team manager, grounds staff etc. but the extent of this depends on the budget available and where and when the need for these roles arise.
There will be elements of the model which we will want to change over time. The whole club was set up in just a few weeks to allow us to submit our first FA application in December 2019. To change it, however, requires a member vote.
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What is the Shakers Community set up to achieve?
The Shakers Community owns the football club, but the Society has responsibilities which go way beyond events on the pitch. These are summarised in the text below, which is a direct copy of the purpose and objects of the Society formally set out in its Rules.
The Society’s purpose is to be the vehicle through which a healthy, balanced and constructive relationship between the Club, Bury AFC, and its supporters and the communities it serves is encouraged and developed.
The business of the Society is to be conducted for the benefit of the community served by the Club and not for the profit of its members.
The Society’s objects are to benefit the community by:
- being the democratic and representative voice of the supporters of the Club and strengthening the bonds between the Club and the communities which it serves;
- achieving the greatest possible supporter and community influence in the running and ownership of the Club;
- promoting responsible and constructive community engagement by present and future members of the communities served by the Club and encouraging the Club to do the same;
- operating democratically, fairly, sustainably, transparently and with financial responsibility and encouraging the Club to do the same;
- being a positive, inclusive and representative organisation, open and accessible to all supporters of the Club regardless of their age, income, ethnicity, gender, disability, sexuality or religious or moral belief.
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How did you price the membership fee?
We want to be as inclusive as possible but at the same time have to balance this against the need to raise more significant funds over the long term to achieve our ambition to climb up the football league pyramid and eventually return to the EFL.
We looked at various membership offers which other clubs have in place. Some made shares available at a considerably higher price than we set, but as a one off purchase. Some are much lower. What was clear was that the prices they set were driven by the circumstances they were confronted with and the specifics of their fan base. FC United of Manchester were able to attract huge numbers of shareholders globally by offering a share at a very low price, but they were tapping into a huge market as the Manchester United fan base was so large. Other clubs with low membership fees have supplemented this with regular ad hoc share offers which has gradually diluted the shareholding of the fans over time. We looked at the way in which Scottish clubs like Hearts used a monthly fee of £10 per month which was useful to spread the cost and make it easier to pay. Small clubs like Lewes also provided some inspiration as good examples of clubs which aren’t well known but provide a genuine community function for their monthly fee and are regarded as extremely inclusive.
We also looked at the average income per household in Bury versus other towns and cities to gauge what was affordable.
We decided on £5 per month or £60 per annum as a compromise between what we thought was the upper end of what we could charge (£10 per month or £120 per annum) and what we have seen as the lowest charge (around £15 per annum). Our membership fee works out at 16p per day.
Ultimately, the more revenue we can bring in the quicker we can build the club up and the more successful it will be.
It is important to note, however, that whilst the revenue generated by membership income can be used to pay for players and football club staff when necessary, this is not the primary purpose for these funds. They will typically be used for:
- Providing a financial buffer which will ensure staff and suppliers are paid in times of financial difficulty (see the Coronavirus situation for an example of how that can happen even to a well run club)
- Investing in longer term projects such as ground acquisition, training facilities and the establishment of a youth academy
- Developing stronger ties with the community to grow the future Bury AFC fan base
We are bound by strict rules within our constitution about what we can use this money for and the funds can never be misused by anY individual.
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What if I want to invest more money?
Annual Membership is designed to collect small amounts of money. Each share purchased through this is non-redeemable i.e. you don’t get any money back once cancelled, and it pays no interest or dividend. This is our Membership Share Offer, and the minimum amount required to purchase it is the annual membership fee.
Each individual can contribute as much as they like into the Shakers Community Membership Share Offer, but it only purchases one vote, and as Membership Shares are non-redeemable the money does not accrue interest and cannot be transferred, inherited or returned.
Other Share Offers
We will look into other share offers which may be redeemable (although no additional voting rights will be granted) and could include a modest amount of interest e.g. up to 2% above base rate. This might also qualify for SEIS or EIS tax relief for higher rate tax payers. This is not available at present and would only be considered for raising more significant amounts of capital. It would allow anyone prepared to invest for a number of years with no right to withdraw in the early years, to earn a small amount of interest and eventually get their money returned. This should never be considered a normal ‘investment’ as it is high risk and the money might never be returned but may appeal to some individuals looking to donate larger sums with the possibility of a small return.
Should we decide to offer redeemable shares at some point, we are under an obligation to maintain sufficient funds to repay any redemptions. Also any individual is only allowed to purchase up to £100, 000 in redeemable shares.
Any investor wanting to invest more than £100, 000 in redeemable shares is invited to talk to the board of the Shakers Community about investing directly in shares in the football club itself, rather than the Shakers Community which owns it, but any dilution of shares would need to be voted on by all voting Members.
If you want to invest a significant lump sum into the club beyond a simple donation into the Shakers Community, please contact us at email@example.com as feedback helps us shape any future share offer.
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How do I become a Member and claim my Membership Share?
You can purchase your membership here. The first £1 of you fee paid goes to the purchase of your Membership Share, the rest is for your Annual Membership.
Membership works on an annual basis, although you also have the option to pay on a monthly basis provided you agree to maintain this for at least a 12 month period. Once you pay your fee you become a Member and will be entitled to vote, subject to the provisions we include in our Terms and Conditions and in the Rules.
Under 16s are unable to vote and we have also included a provision to permit the board to allow only those who have been a member for six months to vote to stop any attempts to subvert the voting process. The board have the discretion to decide whether the latter provision shall apply to any vote but are unlikely to use it unless they observe unusual patterns of membership registrations.
At this stage we are taking personal memberships only, not corporate, but could change that if there is demand.
The annual fee is reviewed annually but you will be advised in advance if it changes.
If you do not renew your annual membership you will cease to be a Member and your share and vote will be cancelled. You will not receive any monetary return when your share is cancelled. Rule 22 sets out other circumstances where membership may be terminated.
Neither voting rights nor shares can be inherited or transferred to someone else although we can provide proxy voting rights for anyone unable to vote.
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What terms apply to Membership Shares
The full details can be found in the Rules, below is a brief summary.
The first £1 of your membership fee is used to purchase your voting share in Shakers Community Society Limited. It may not be sold or transferred. The remainder is used to pay your ongoing membership fee.
Once your membership ends, through cancellation or non payment of membership fees, your share is simply cancelled and not refunded.
Annual fees will be be renewed on the same date of the following calendar year and membership will last for those 12 months.
If you pay monthly you are obliged to pay your membership fee for the first 12 months as a minimum then may cancel it with 1 months notice. You may not vote once you have cancelled, even if you have made a payment for the current or next month.
Membership fees will not be refunded except in exceptional circumstances and at the absolute discretion of the board of Shakers Community Society Limited.
By becoming a member you agree to the Society Rules and any other rules or policies that may be issued.
You also agree to abide by the Bury AFC Code of Conduct.
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Who can be a Member Shareholder?
In theory anyone can be a Shakers Community member, and own a Membership Share, provided they pay the relevant membership fee. However, we do specify in our rules (Rule 10) that members should be fans of Bury, or at least local football and have the interests of our community at heart. We want members to be engaged with Bury AFC and use their voting rights. Anyone wishing to help but not wanting to get involved in this way can support us by simply donating money instead.
Please note that anyone under 16 cannot vote under Society rules, although we have created a special Under 16 membership fee.
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How is the club and its assets protected?
We have a set of rules which are required under our FCA authorisation and provide the core structure for the way the Community Benefit Society operates for the benefit of the club and its Members. You can read those rules here. We are also developing secondary rules and policies which will provide more practical detail on specific areas.
These rules include an ‘asset lock’ which means that no individual can ever take the money or assets (including shares in the club or ground if we owned one) away from it. If the CBS was ever wound up the money would have to go to another CBS or similar organisation such as a charity. This should give greater confidence to Members, donors and investors when contributing money, and will put off predatory financial speculators.
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How is the club structured?
The governance of the club is a fundamental part of its identity. Nobody wants to repeat the mistakes of the past. We want to ensure that fans control the direction of the club. At the same time we need to provide some flexibility to allow future generations to make decisions, and to create a platform for us to return to the Football League. There is a need for us to be pragmatic – we have to ensure that the administration of the club doesn’t take over what happens on the pitch, and we have to be vigilant to ensure we do not allow a repeat of the situation Bury fans endured in the recent years. We also considered how larger investment amounts can be raised and received in future, to fund a ground purchase in particular.
We decided to use two companies in the club structure. Firstly, the club itself, Bury Football Club (2019) Limited which trades as Bury AFC, and is a straightforward limited company registered at Companies House.
The shares in this limited company are 100% owned by the second entity, Shakers Community Society Limited. This is a Community Benefit Society, a form of mutual society, which is authorised by the Financial Conduct Authority and appears on the mutual register with society number 8350. This is where fan shares are held, as the society model allows us to administer lots of small shareholdings far more efficiently than the limited company, and with greater protections for all concerned.
Two other important considerations were involved in the decision to use these two separate entities:
- The EFL Rules currently do not allow a Community Benefit Society (CBS) to be a football club in the Football League. It has to be a limited company. A CBS owning a limited company is fine.
- It would have to be agreed by member vote, but we may wish to dilute down the CBS ownership stake in the club at some point in future, by selling shares in the club itself to someone willing to contribute significant capital. This structure would allow us to do that.
We took advice from other clubs who have been through this process already, and we are fully supported by the Football Supporters’ Association (FSA). The same model has been used by other clubs such as Wrexham, FC United of Manchester, and Portsmouth. We also sought independent professional advice to ensure that we were not missing a trick. We have kept an audit trail to record the detail of each decision made, and why we made it, along the way.
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What is a Community Benefit Society?
The underlying structure of our fan ownership model is a Community Benefit Society (CBS). This is a form of mutual society, as we do not qualify as a charity. There are, however, some similar tax advantages granted to a CBS as it is a not for profit organisation. We explored other models, such as a Community Interest Company, but a CBS offered the best combination of features, efficiency and cost. It is also a company limited by shares so, as with any limited company, it provides protection for its shareholders. The CBS is authorised by the Financial Conduct Authority (FCA) And is registered on the FCA’s mutual society register with society number 8350.
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