In the world of business specifically, this is a very popular term. An advisory board as the name implies is a group of individuals who are appointed to provide guidance and advice to an organization, business, or non-profit entity.
The members of an advisory board are often experts and professionals in their field capable of providing valuable insights, advice, and support to the organization.
Every advisory board has a primary purpose which is to provide strategic guidance and support to a business or an organization's leadership – in simple terms, they help with effective board management.
These strategic guidelines may include advice on matters such as business strategy, financial management, marketing, and branding, or legal and regulatory issues.
Advisory boards of an organization or business can also help in identifying opportunities for growth and development. And provide support for fundraising and other initiatives.
Advisory Board vs Board of Directors:
Although both boards serve the same general purpose; pushing the organization to excel, both boards can equally represent the organization publicly. Their primary difference is in their legal responsibilities.
So while an advisory board has no governance responsibilities – members have no voting rights and cannot exercise financial responsibilities on the company's behalf.
Primary responsibilities/focus of an advisory board:
- Linking an organization to a new audience
- Empowering an organization's network by planning events
- Directing an organization's board leadership in certain issues
- Empowering the organization in the community.
Even though the advisory board members are a group of professionals and experts, membership is usually acquired through appointment by the company or organization's leadership.