The Director's & Officer's Guide to Advisory Boards

By Robert K. Mueller | Go to book overview
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4
ROLE OF AN ADVISORY BOARD OR COUNCIL
Unlike a statutory board, an advisory group can avoid some unwanted powers and responsibilities. The advisory board can function without a legal right to depose management and without legal responsibility to external publics. There are various reasons for using advisory boards:
1. A gap-filling function when the owners or owner-representatives lack time or expertise to cope with the difficulties of governing or managing an organization in a dynamic environment;
2. A resource to the top management and the statutory board. The advisors supplement the expertise of the internal staff. They avoid the consequences of group-think, concinnity, and lack of objectivity when the advocates of a decision are involved in its justification or are beneficiaries of the action;
3. Providing special peer-acceptable insight in the gray area of entrepreneurship, innovation, and professional business administration;
4. As an adjunct to the corporation's intelligence-gathering system for purposes of activity or societal scans on an international or specific functional or strategic area of interest (technology, economics, marketing);
5. To identify and evaluate alternative courses of action not foreseen by the management or the main board;
6. To assist the CEO in resolving or reconciling serious internal differences of opinion by an objective outside judgment; 1 and
7. To provide introductions to potential customers, suppliers, or clients; develop business, government, and trade relations; keep abreast of political,

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