How to run an effective advisory board meeting

Advisory boards offer growing companies a way to tap into diverse expert advice without the formal authority or fiduciary responsibility of a board of directors. Simply defined, an advisory board provides non-binding strategic advice to management while serving as a crucial stepping stone to formal governance.

For growing companies, professional advisory board management demonstrates governance maturity that attracts high-quality advisors and positions organizations for future investment opportunities. Yet despite their proven value, most middle-market companies haven’t established formal advisory boards, representing a significant untapped opportunity.

To maximize this opportunity, it's vital to strategically approach the planning and running of advisory board meetings.

Role of the advisory board

The role of the advisory board is to have experts share their insights and to fill knowledge gaps among corporate leadership. Advisory board members are often selected for their particular areas of expertise.

Unlike a board of directors, an advisory board does not serve a management function, nor do its members represent shareholders. They are there to provide advice and expert knowledge. Advisory board members typically receive lower compensation than their board-of-director counterparts.

Advisory boards also often "provide safe harbours for executives who may be able to test-drive options" before taking them to the board of directors, according to Ivey Business Journal.

However, despite the formalization of advice, advisory boards tend to be less formal and go with the flow of executives' needs. A CEO, for example, may feel more comfortable expressing a tentative or partly formed view before an advisory group whose purpose is to provide advice and feedback.

For growth-stage companies, advisory boards provide several strategic advantages:

• Knowledge gap filling: Access expertise that internal teams haven't developed yet.
• Network expansion: Tap into advisors' professional networks for partnerships, customers, and talent.
• Governance preparation: Practice formal meeting processes before establishing a formal board.
• Credibility building: Demonstrate professional management to investors and stakeholders.
• Strategic validation: Test major decisions with experienced professionals before implementation.

Role of an advisory board chairman

An advisory board chairman serves as the point of contact between the board of directors and the advisory committee. The advisory board chairman is responsible for running the board meeting as well as appointing subcommittees, if necessary.

The major duties of an advisory chairman include:

• Attending advisory board meetings
• Providing counsel
• Appointing subcommittees
• Monitoring discussions during the meetings
• Mitigating any conflicts that might occur during the meetings

The advisory board chairman may also sit on the board of directors. However, careful consideration should be paid as to when the chairman should attend executive sessions, and whether that participation helps the board of directors or has the potential to trigger problems or conflicts.

How to create a stellar advisory board

An advisory board ideally offers support beyond the expertise and knowledge that board members and company executives can offer. Selecting an advisory board is quite similar to selecting a board of directors, but with a few variations.

Best practices for creating a top-level advisory board include:

• Focus on the expertise the advisory board should have. What specific experience should advisers have in order for your organization to gain insight? Some advisory board members may have a perspective on a particular topic. For example, a Science Advisory Board (SAB) might include advisers from scientific organizations, both private and public.
• Recruit brutally honest individuals. You need advisers who aren't afraid to cast doubt and to contradict leadership. Offering only the advice leadership might want to hear means potentially ignoring best practices and facts on the ground, which will only work against a company.
• Keep the board size small. The more intimate your advisory board, the better you’ll be able to leverage their expertise and skills. A good rule of thumb: an advisory board should number about half the members of your corporate board.

Best practices for running an effective advisory meeting

Running advisory board meetings takes many cues from best practices for the larger board of directors. The key to getting the most out of the leaders on the board is similar to that of any corporate meeting.

1. Have a clear agenda

Make sure you're focused on what will be covered in the meeting as well as the pertinent information, such as location and time, length of meeting, and topics to be discussed.

Preparation is everything. Be sure to send out the agenda to the advisers in advance (a week or even a month prior) to set expectations.

2. Determine meeting frequency

Advisory boards typically meet two to six times per year, with quarterly meetings representing the most popular frequency. The cadence of the meetings will be determined by your advisers' availability and how often you want their advice. Regardless of the frequency of these meetings, it’s crucial to keep your board abreast of your organization’s activities regularly.

3. Consider how technology can help

Many mid-sized companies now rely on hybrid advisory board models that combine physical and virtual meetings. Consider the following:

• Is there a way to distribute your materials securely before the meeting?
• Will you be able to record the meeting or hold the meeting virtually?
• Is there a way for you to digitally inform the advisory board of any updates?

A board portal can offer ways to securely collaborate with your advisory board, even if they are dispersed around the globe.

4. Put advisory board charters in writing

Granted, advisory boards are more informal than company boards of directors. However, they should still be governed by written agreements. Consider working with legal counsel when creating an advisory board to help draft clear charters that define board responsibilities, meeting logistics, compensation structures, and confidentiality requirements. Non-disclosure agreements are particularly important since advisors will have access to sensitive strategic information and competitive data.

Sample advisory board meeting agenda

While each advisory board will have its own needs, the following structure provides a framework that maximizes strategic value while respecting advisors' time:

1. Meeting opening (5-10 minutes)

• Welcome and introductions for any new members
• Review of meeting objectives and agenda
• Confirmation of previous meeting action items

2. Company update (15-20 minutes)

• CEO briefing on key developments since the last meeting
• Financial performance highlights
• Market conditions and competitive landscape

3. Strategic discussion topics (45-60 minutes)

• Specific challenges or opportunities requiring advisor input
• Major strategic decisions seeking board guidance
• Industry trends and their implications
• Risk assessment and mitigation strategies

4. Advisory input & recommendations (20-30 minutes)

• Open discussion and advisor feedback
• Specific recommendations from board members
• Resource introductions or networking opportunities

5. Action items & next steps (10-15 minutes)

• Summary of key decisions and recommendations
• Assignment of follow-up actions
• Scheduling of next meeting
• Brief meeting evaluation

Send detailed briefing materials at least one week in advance, including specific questions you want advisors to consider. This ensures the meeting focuses on strategic discussion rather than information sharing.

Current challenges to advisory boards

Whether your organization is for-profit or nonprofit, several obstacles and challenges may impact your advisory board, and thus, the efficacy of your advisory board meetings.

Common advisory board challenges include:

• The advisory board is disengaged and rarely meets: Often due to poor preparation or lack of a clear value proposition.
• Meetings lack a call to action and a clear process: There’s no systematic preparation or follow-ups.
• Advisers don't offer any advice: Usually because they're not properly briefed, or meetings focus on updates rather than seeking input.
• Lack of communication with the advisory board: Irregular communication between meetings leads to disconnected advisors.
• Advisory board lacks focus: Without clear strategic objectives and structured discussions.

Solutions for common challenges

To overcome some of these obstacles, consider the following best practices:

• Meet at the start of each year to review the advisory board's plan: Establish clear objectives and expectations for the advisory relationship.
• Create a monthly update report to inform your advisory board: Keep advisors engaged between meetings with regular, structured communication.
• Ask for particular advice and feedback from your advisers: Come prepared with specific questions rather than general updates.
• Consider increasing compensation or bestowing some equity in the company: Align advisor incentives with company success.
• Keep the meetings short and focused: Respect advisors' time by maintaining disciplined meeting management.
• Implement professional governance infrastructure: Use systematic preparation, secure communication platforms, and comprehensive follow-up to demonstrate governance maturity and maximize advisor effectiveness.

Professional governance infrastructure for advisory boards

Growing companies often underestimate the infrastructure needed to run effective advisory boards. While advisory boards are less formal than boards of directors, professional management significantly impacts advisor engagement, meeting effectiveness, and the strategic value your company derives from their expertise.

Here are some key capabilities that enhance advisory board effectiveness:

1. Professional meeting preparation: Automated agenda creation, comprehensive briefing materials, and systematic pre-meeting communication that demonstrates respect for advisors' time and expertise. This level of preparation attracts higher-quality advisors who expect professional governance standards.

2. Secure document management: Professional platforms for distributing sensitive strategic information, financial data, and competitive analysis that advisory boards need to provide valuable insights. Security and professionalism signal governance maturity to advisors with board experience.

3. Strategic discussion facilitation: Intelligent preparation tools that generate relevant discussion topics, identify key decision points, and ensure meetings focus on strategic advice rather than operational updates. This maximizes the value derived from advisory board expertise.

4. Systematic follow-up and action tracking: Comprehensive documentation of advice received, decisions made, and action items assigned, with automated follow-up systems that ensure advisory board recommendations are implemented effectively.

Companies with professional advisory board infrastructure demonstrate operational maturity that attracts high-quality advisors, creates more effective strategic discussions, and builds governance foundations that support future funding and growth opportunities.

How Diligent enhances advisory board management

Advisory boards serve as excellent preparation for formal board governance while providing immediate strategic value. Companies that approach advisory board management professionally build governance foundations that support future growth, attract higher-quality advisors, and demonstrate operational maturity to investors and stakeholders.

The investment in systematic advisory board management pays dividends through better strategic advice, expanded networks, and enhanced marketplace credibility.

Ready to enhance your advisory board management? Request a Diligent demo to see how implementing a professional governance infrastructure can enhance your advisory board effectiveness and support your growth objectives.