Both boards of directors and advisory boards aid in helping an organization achieve new levels. However, their main difference is in their legal obligations. An advisory board is a great way for nonprofits to interact with the community by offering their perspective and ideas.
An advisory board doesn’t have the same legal responsibilities and fiduciary duties as a regular board of directors, which means they are not able make financial decisions on behalf of an organisation. It is important that both the advisory and directors of the board are aware of the role and responsibilities of the advisory board.
It is important to clarify the functions of an advisory panel by means of writing a board resolution. This will stop people on the advisory board from acting as directors. This can be a challenge, not only because of legal issues, but also because it can create confusion and anger between the advisory board members and the board.
An advisory board that is well-established can be a valuable resource for a non-profit organization, and it’s vital that everyone involved is aware of what their role is. By ensuring that there is a clear difference between an advisory board and a regular Board Organizations can avoid confusion, avoid blunders and retain top talent.
