8 Attributes to Look For
Every family business reaches a point where the people already around the table aren’t enough.
Family leaders trust each other. Executives know the business inside and out. But neither group is built to challenge blind spots, or bring in the outside experience the business needs for its next stage of growth.
That’s what an advisory board is for.
Done right, it gives you access to expertise your business doesn’t have in-house, a sounding board that will tell you what you need to hear instead of what you want to hear, and a group of people invested enough to help you think through the hard decisions before they become crises.
Done wrong, it’s just a group of people that meet a few times a year and add little value.
The difference almost always comes down to who you put in the room.
Before you get to individual names, it helps to think about candidates across three dimensions:
- Business Expertise: strategy, operations, finance
- Leadership and governance expertise: CEO coaching, governance, succession
- Ownership and family expertise: wealth management, estate planning, shareholder relations, and family continuity
The right mix of these will shift as your business and your family move through different stages of growth and ownership.
Whoever you’re evaluating, here are the eight questions worth asking before you invite them to the table.
1. What strategic challenges can this person help us solve over the next five years?
Look for experience that matches where your company is headed in the next 3-5 years, not just where it’s been.
As the business evolves, the competencies represented on your board need to evolve with it.
Revisit the mix periodically to make sure it still matches your strategic priorities and where you are in your life cycle.
2. Will this person tell me what I need to hear, not what I want to hear?
The best board members bring high integrity, sound judgment, and confidentiality, along with the courage to challenge management constructively.
They also have to maintain trust with owners and leadership at the same time.
That combination is rare, and it’s worth screening for directly.
3. What expertise is missing today, and what expertise will we need in the next chapter of the business?
A good advisory board adds capabilities your leadership team doesn’t already have.
Collectively, that means expertise across business strategy, leadership, finance, operations, governance, mergers and acquisitions, talent development, wealth management, estate planning, and family business succession.
That mix should shift as your company and your ownership group move through different stages.
4. Can this person earn the trust of our family and ownership group, not just management?
Board members need to understand the dynamics that come with a family-owned business, and they need to build genuine relationships with family members, shareholders, and the next generation.
Part of the job is facilitating hard conversations about ownership, governance, succession, and family harmony, all while staying objective.
5. Can they challenge ideas without damaging relationships?
Look for people who are emotionally intelligent, curious, and humble, and who work well alongside management and the other advisors in the room.
The goal is healthy debate, not tension.
The best board members know how to push back on an idea while still keeping everyone’s respect intact.
6. Will they invest their time and energy, or simply lend us their name?
A title on a board isn’t worth much without the work behind it.
Look for people who will prepare, show up, stay engaged between meetings when it matters, and actively support your company through introductions, coaching, and counsel.
7. Can this person open doors that management cannot?
The right board members bring relationships you don’t already have: with customers, talent, capital providers, strategic partners, industry leaders, or acquisition opportunities.
Those relationships can create long-term value for your business.
8. If our CEO were suddenly unable to lead tomorrow, could this person help stabilize the business until a long-term solution is in place?
This one often gets overlooked.
A strong board member has the experience, credibility, and willingness to step in as an interim executive, executive advisor, or crisis leader if the CEO or another key executive becomes unexpectedly unavailable.
That kind of contingency planning can protect enterprise value at exactly the moment you need it most.
An advisory board is only as good as the people sitting on it.
If you’re building your first board, choosing new members, or wondering whether the board you already have still fits where your business is headed, we can help.
Our team works with family businesses to set up advisory boards, identify and vet the right members, and in some cases, serve as board members ourselves.
Reach out today to set up a conversation with one of our experienced family business advisors →
Additional Reading
Why Your Family Business Needs an Advisory Board
Lays out what an advisory board actually does for a family business and how it differs from a governing board.
Advisory Boards: Essential Questions Family Business Owners Should Ask
How to get an advisory board off the ground. The right questions to ask about purpose, composition, compensation, confidentiality.
Does Your Family Business Need a Board of Directors?
Rob’s recap of a Private Directors Association panel distinguishing a fiduciary board of directors from an advisory board, useful if you’re deciding which structure you actually need.
Family Business Governance: What’s the Difference Between Board, Shareholder, and Family Council Meetings?
Breaks down how board meetings fit alongside shareholder and family council meetings.
What is Family Business Governance? Busting Common Myths
Addresses the fear that formal governance (including a board) will “corporatize” a family business. (Spoiler: it won’t!)
Healthy Conflict vs. Unhealthy Conflict in Family Business
Rob on the difference between conflict that strengthens a company and conflict that damages it.
The Emotional Work of Family Business Succession Planning
Includes Rob’s own story of a board that had to install one of its own members as interim CEO after a leadership failure, a real example of Question 8 in action.