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January 20, 2022
Leverage the Power of Advisory Boards for Your Nonprofit
By Susan C. Hammond, CPA, MST

Susan C. Hammond
Susan Hammond
An advisory board can be an important adjunct to a nonprofit’s fiduciary board ”“ by expanding the scope of expertise that your organization can access, increasing your connections in the community, and bringing in new people who will advocate for your mission.

You can use an advisory board to learn more about individuals who are potential candidates for your fiduciary board or to strengthen ties with donors or potential donors. Also, fiduciary board members who have “termed-out” can continue to serve by moving to the advisory board. Finally, some people are barred by employers from sitting on fiduciary boards yet still have valuable expertise to provide and a desire to serve; an advisory board is a perfect solution for such people.

Here’s another important point: Although advisory boards are primarily used to advise a nonprofit’s leader, they aren’t just for the “top of the house.” Department managers and staff can also benefit from bringing in a group of outside experts.

Almost any nonprofit can benefit from having an advisory board but typical situations in which such a board can be helpful include:
  1. The executive director or department manager is afraid she will “miss” something or needs people to support her where she is weak. An advisory board comprised of people with expertise that the executive director or manager lacks will benefit both the individual and the organization.

  2. The executive director or department manager is young and the position is a stretch. Instead of hiring a coach, form an advisory board of senior people who have served in positions similar to the one held by the person who is to be advised. This benefits the individual and the organization while providing valuable multiple perspectives.

  3. Decisions made by the executive director and/or a department manager are being second-guessed by other senior managers and staff. An advisory board can help the executive director and/or department manager develop a better process for decision-making.

  4. The nonprofit needs to expand its facilities. An advisory board with facility managers, engineers, architects, and perhaps an accountant can provide the necessary expertise for planning the expansion.

  5. The nonprofit was started as a family charity and its fiduciary board continues to be made up primarily of family members. An advisory board can bring in the voices of the constituencies the nonprofit serves.
Meshing with the Fiduciary Board

Some nonprofits call their advisory boards committees or councils to avoid confusion between this group and the fiduciary board. Whatever you choose to call your group of advisors, it is important to set up systems so good communication is maintained between this group and the fiduciary board.

For example, hold periodic joint meetings between the two groups. This can be particularly helpful if one purpose of having an advisory board is to vet potential members for the fiduciary board; such joint sessions will give everyone a chance to get to know one another better.

You may also want to appoint a member of your fiduciary board to act as a liaison to the advisory board, being responsible for communicating with the advisory board and bringing news of their recommendations back to the fiduciary. In some cases, it may even be appropriate to have a fiduciary board member actually serve on the advisory board.

How to Get Started

If you think your nonprofit might benefit from an advisory board, the first step to take is to determine what purpose the board will serve. For example, if you want to use the board to draw in well-known people who can attract donations, that is a legitimate purpose, but it needs to be defined before you start putting together a list of potential members.

If your chief aim for the advisory board is to fill in gaps in expertise, your starting point should be establishing an up-to-date vision for your organization. The next step is to do a candid analysis of the organization’s strengths, weaknesses, opportunities and threats, known as a SWOT analysis. Reviewing your SWOT analysis in combination with the vision of where you want to take your nonprofit will help point out where gaps exist in skills, talents, and contacts to realize the vision. Recruit advisors who can fill the gaps you identify.

From the Expert Advice archives. Originally published in 2011.

Susan C. Hammond, an expert on advisory boards and nonprofit board governance, is author of the
Advisory Board Kit, A Comprehensive Guide to Establishing an Advisory Board.
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