Boards of directors and advisory boards aid in helping an organization to reach new heights. However, their main difference lies in their legal responsibilities. An advisory board can be a useful instrument for nonprofits to connect with the community by offering their ideas and perspectives.
A advisory board is not subject to the legal obligations or fiduciary responsibilities of a regular board, therefore they are unable to make financial decisions for an organization. This is the reason it’s crucial to ensure that both the advisory board as well as the board of directors are aware of the significance of the advisory board, as try this web-site well as the boundaries of its responsibilities.
This is especially important if an organization commonly refers to both groups as the « board. » By writing down a clear explanation of the role of an advisory board by way of a board resolution for instance – you can make sure that individuals on the advisory board don’t accidentally start acting as a board directors. This is a concern not only for liability reasons but also because it could cause confusion and frustration to both the advisory board as well as the board of directors.
An advisory board that is well-established is a great resource for non-profits, and it’s essential that everyone involved understands what their role is. By making sure that there is a clear distinction between an advisory board, and a regular Board to avoid confusion, avoid blunders and retain the best talent.
