PMBOK 7 calls the charter the "authorization document" — without one, the project doesn't officially exist. Without official existence, you can't draw on the budget, and you can't escalate when something blocks you.
What's in it
- Project name + sponsor — who owns the budget, who's the named PM.
- Business case — why this work is funded vs. the next ten things.
- Objectives + success criteria — measurable. "Reduce handoff errors by 40%" not "improve handoff process."
- Scope (in / out) — equally important: the explicit out-of-scope list pre-empts scope creep.
- High-level milestones + budget — order of magnitude, not detailed.
- Stakeholders + their authority — who can say yes, who can say no.
- Assumptions + constraints + risks — known unknowns documented up front.
↳ in the wild
The charter is most powerful three months in, when someone says "wait, I thought we were also going to handle X." You point at the explicit out-of-scope list and the conversation ends in 30 seconds instead of three weeks.
Sign-off matters
The sponsor signs (or emails approval of) the charter. That signature is what gives the PM authority to spend the budget, pull in resources, and make scope calls. No signed charter, no authority — and no recourse when things go sideways.