Both boards of directors and advisory boards assist an organization achieve new levels. But their main difference lies in their legal obligations. An advisory board is a great tool for nonprofits to connect with the community by offering their perspectives and suggestions.
An advisory board does not have the same legal responsibilities and fiduciary responsibilities as a regular board of directors, which means that they are not able to make financial decisions on behalf of an company. This is why it’s important to ensure that both the advisory board and board of directors are aware of the importance of an advisory board and the limits of its duties.
This is particularly crucial when try this web-site an organization refers to both groups as the “board.” By establishing written clarification about the role of an advisory board via a resolution of the board for instance – you can make sure that individuals on the advisory board don’t accidentally begin acting like a board of directors. This is a problem that’s not only for liability reasons but also because it can cause confusion and frustration to both the advisory board and the board of directors.
An advisory board of high quality can be a great resource for a non-profit organization, and it’s crucial that everyone involved is aware of the role they play. By ensuring there is a clear difference between an advisory board, and a regular Board, organizations can avoid confusion, avoid mistakes and retain the best talent.