So you’ve worked away for years, done the hard yards, and become a respected professional in your field, when someone approaches you and asks you to sit on their nonprofit’s board. So you prepare, research, find out all the correct governance procedures you need to take and become familiar with everything the law requires the company to do.
Then you get into your first meeting and find - nobody’s talking about regulations, or governance, or nonprofit law. It’s all about the company’s direction, strategy, and solutions to problems you didn’t know existed. You mistook this advisory board for a governing board.
Let’s explore the differences so nobody else makes the same mistake.
One of the biggest sources of confusion when talking about these two groups is that they are both just referred to as “The Board”. “Oh, The Board needs that budget by next Wednesday”, “The Board’s looking for a new secretary”, “Can you take minutes at the next Board meeting?”, etc.
This can lead members of advisory boards to make assumptions about what they’re allowed or required to do, both in meetings and when interacting with stakeholders. This can lead to problems with liability, confidentiality, and other surprisingly serious issues. When discussing your organisation’s governing bodies, always be sure to clarify exactly what kind of board you’re talking about.
A governing board is exactly what you think of when you think about a Board of Directors. A group of people, led by a Chairperson or similar, who ensure the organisation they work for is complying with all legal and regulatory requirements set by the government. They also typically set the organisation’s broader strategy, direction, and mission. A nonprofit is required by law to have a governing board, and it’s that governing board’s job to ensure the company is serving it’s community to the best of it’s abilities.
So what is an advisory board, then? An advisory board will typically be set up by a company on a case-by-case basis to advise the governing board (and other decision-makers) on how to proceed with certain projects or problems that the organisation is dealing with.
They are specifically there to help the owner grow the business and take it to the next level. Because of this, they are often temporary, and staffed with experts in relevant fields. They aren’t bound by the same regulatory bodies as a governing board, and as such are freer to be agile and creative in their problem solving - but this also means that they have no direct decision-making authority.
A nonprofit might put together an advisory board to help navigate the world of fundraising, or to impartially assess the nonprofit’s impact and advise on ways to improve.
Governing and advisory boards will, to an outside observer, often look the same: a team of experts having regular meetings to discuss a company’s future. However, while a governing board is bogged down in the bureaucracy that comes with executive powers, an advisory board has the time and resources to analyse the best ways to take the organisation to the next level, and ultimately create a stronger community.