www.theirboard.com/whats-the-difference-between-the-board-of-directors-and-an-advisory-board/
A board of directors is a set of individuals responsible for management, control and direction of an organization. They are accountable for the legal obligations of a business and are held to a strict standard of accountability. This means that if they fail to fulfill their fiduciary obligation and are found to be in breach, they could be personally accountable.
A group of individuals who advise and guide the company is called an advisory board. The advice they provide is more practical, and their focus is on growth, development and strategy, not reporting and governance, reducing risk and avoiding risk of downside.
Ideally, a company should clearly define the purpose of its advisory board in all official documents like meeting minutes, as well as in communications via verbal to avoid confusion. This will ensure that they don’t accidentally cross over into the territory of being a board of directors, which can have serious legal implications for members if they’re not meeting their fiduciary duties.
In the real world, this distinction can be blurred, and companies may refer to their advisory board as “the Board.” It is worthwhile creating a formal statement to avoid confusion and accidental mistakes. A formal written document that outlines the purpose of an advisory committee can reduce confusion among those involved. This is particularly helpful when members of the board have previously been part of the board or are new to the company.