HOW TO CREATE AN ADVISORY BOARD FOR YOUR BUSINESS

🎥 Watch the full video below to hear directly from Louise and Udo as they unpack what really matters when establishing a high-performing advisory board – covering purpose, structure, member selection and ethical governance.

WHEN TO establish an advisory board – HOW DO I KNOW IF IT’S THE RIGHT TIME?

Many organisations choose to create an advisory board during a make-or-break moment. It’s often when they are asking strategic questions like “What’s next?”, “How do we scale?”, or “Are we structured to meet future challenges?”

These trigger points can vary widely – from a founder reaching capacity, to a board wanting more specialised input without expanding the governance board, or an executive team preparing for market expansion or transformation.

According to Advisory Board Centre data, organisations commonly set up advisory boards when they reach between $1.5M and $100M in revenue, although the model is flexible and applicable across sectors and business sizes. The key factor is not size, but readiness to seek external insights and structured support without handing over decision-making authority.

As Udo Doring notes, more than 80% of organisations establishing an advisory board are doing it for the first time. That’s why clarity of purpose and a well-thought-out advisory board structure are so essential in the early stages.

BEST PRACTICE ADVISORY BOARDS

The advisory board sector is largely unregulated, which means approaches can vary significantly. To address this, the Advisory Board Centre developed the Advisory Board Best Practice Framework (ABF101) to guide both organisations and professionals in establishing ethical, fit-for-purpose advisory boards that drive measurable value.

The Framework is built around five key principles:

• Clarity of scope: Being specific about what the board is – and isn’t – there to do.
• Purpose-driven structure: Aligning the model to the organisation’s unique goals.
• Structured discipline: Building a cadence and process that supports momentum, not bureaucracy.
• Measurement of impact: Establishing ways to track outcomes and contribution.
• Fit-for-purpose people: Ensuring independence, alignment and capability in all roles.

Advisory boards that follow these principles benefit from stronger alignment, reduced risk, and better decision-making across the organisation.

WHERE TO START WHEN SETTING UP AN ADVISORY BOARD

The first and most important step in establishing an advisory board is defining its purpose. This goes beyond general ideas like “providing advice” or “guiding growth.” Organisations need to ask: What specific challenges or opportunities do we want to address? What outcomes do we hope to achieve in 12–24 months? And just as crucial, what is the advisory board not responsible for?

Once the purpose is defined, the next step is to determine the most suitable model. Advisory boards come in various forms: project-based boards, pop-up panels, peer advisory groups, or full strategic advisory boards that span the whole business. The model should reflect the type of conversations the organisation needs to have, whether broad and exploratory, or narrow and specialised.

From there, a well-drafted charter becomes the foundation document. The Charter should articulate the purpose, scope, meeting cadence, and structure of the advisory board. It should also outline roles – including the Chair, Internal Sponsor, and Secretariat – and establish ethical guidelines such as independence declarations and conflict of interest management.

As Louise Broekman emphasizes, the Charter is where expectations are managed and alignment is reinforced.

SELECTING THE RIGHT PEOPLE

Member selection is often the most visible part of the establishment process, but it should not be rushed. A common mistake is starting with who should be on the board, rather than what conversations need to be had. Udo Doring encourages organisations to focus on finding the right mix of thinking styles, perspectives, and relevant experience – not just big names or familiar connections.

Importantly, organisations should avoid approaching advisory board appointments like traditional hiring. After all, advisors are not employees. Their value lies in their independence, curiosity, and ability to challenge constructively. Organisations should listen for the types of questions potential advisors ask, and look for candidates who are well-prepared, thoughtful and focused on contribution over control.

Equally critical is the alignment between the Chair, Sponsor, and Secretariat – a relationship the Advisory Board Centre refers to as the “golden triangle.” This internal dynamic is essential to ensure the board is not only well-structured, but also well-supported and accountable.

ORIENTATION AND LONG-TERM IMPACT

Once the board is structured and members selected, holding an orientation session before the first official meeting is highly recommended. This ensures everyone understands the advisory board structure, purpose, and culture – and prevents confusion or misalignment from the outset.

Orientation helps set expectations and establishes a rhythm for meetings. It also allows advisors to build rapport and understand the organisation’s priorities before diving into strategic discussions. As Udo notes, without this step, boards often fall into the trap of trying to solve everything in the first session – leading to scattered thinking rather than strategic focus.

Ultimately, a high-impact advisory board is not just well-structured; it is designed to evolve with the organisation. As needs shift, the model, members, and even cadence may adapt. But the foundational work done in the establishment phase provides the scaffolding for that evolution.

Interested in learning more? Check out these resources:

• When does a business need an advisory board?
• How is an advisory board compensated?
• How does an advisory board differ from a board of directors?
• How should I structure my advisory board?

GET SUPPORT FROM THE ADVISORY+ TEAM

If you’re establishing an advisory board for the first time – or reassessing or reviewing an existing one – the Advisory Board Centre’s Advisory+ service can help you get it right. This global, independent service assists with scoping, model selection, charter development, and member identification, board recruitment, and board reviews all aligned to best practice. It’s already helped more than 2,000 organisations create advisory boards that deliver measurable value.

Whether you’re a founder looking for strategic insight, a governance board seeking external expertise, or a senior executive leading change, Advisory+ can provide the guidance and connections you need to establish an advisory board that works for your organisation.

Ready to enhance your business for the better? Learn more and reach out here.