Comparison
What is an advisory board?
An advisory board is a body that advises the management of a family or mid-sized business and, depending on the articles, also oversees it. It usually meets a few times a year. In many businesses it is set up voluntarily.
Service
What it does.
Outside experience, a regular mirror for the owner, often contacts too. In many family businesses it accompanies the succession and mediates between shareholders.
Cost
What they cost.
According to a Kienbaum study, ordinary members of advisory and supervisory boards received just under €25,000 a year on average, chairs almost twice that. The range runs from under €5,000 to over €60,000; a good quarter of members are below €10,000.
Kienbaum, advisory board and supervisory board study 2022.
Fit
When they are the right choice.
- The owner wants a lasting mirror.
- A succession is coming up, or several shareholders have to agree.
- The business is large enough to need advice and oversight separate from management.
Limits
Where their limit lies.
An advisory board advises a few times a year. It doesn’t judge a single measure between meetings, and it doesn’t lead a build. And it is only as good as the questions put to it.
Decision
What has to be decided first.
What is the advisory board meant for: advice, oversight, succession, mediation? If that isn’t decided beforehand, you fill a body with good people who have no brief. If a handover is coming up: Succession. If it is about who decides what today: Organisational consulting.
Lawyers and tax advisers settle the articles, liability and pay in detail.
Comparison
| Role | Delivers | Right when | Limits |
|---|---|---|---|
| Advisory board | Advice and, depending on the articles, oversight in fixed meetings | the owner wants a lasting mirror, often before the succession | It advises a few times a year. It doesn’t judge a single measure in between. |
| Decision Architect | a judgement before the measure, in writing, and then he leads the build | plans contradict each other or money is being lost and nobody knows where | He doesn’t build himself and doesn’t decide for you. |
An advisory board accompanies a business over years. A Decision Architect judges the decision that is due now.
Questions
Is an advisory board mandatory?
Not for most mid-sized limited companies (GmbH). Whether and when a supervisory board is required is a question for your lawyer.
How often does an advisory board meet?
Usually a few times a year. How often is set in the articles.
More comparisons: What does a management consultant cost? · What does a management consultant do? · What does an interim manager do? · What does a business coach do?