What is a “project charter” in capital project management?

A "project charter" in capital project management serves as a foundational document that defines the scope, objectives, and overall direction of a project. It is essential for setting the framework within which the project will be executed. This document outlines the goals to be achieved, the key deliverables, and the project’s boundaries, ensuring that everyone involved has a clear understanding of what the project aims to accomplish.

The project charter often includes details about the project's stakeholders, resources required, and high-level timelines, but its primary purpose is to provide a comprehensive overview that aligns the project team's efforts with the organization’s strategic objectives. By having a well-defined project charter, project managers can ensure all team members and stakeholders are on the same page regarding the project's intent and expectations.

This clarity is particularly crucial in capital projects, where significant investments are involved, and misalignment can lead to project delays, increased costs, and other complications.