Many businesses operate with a limited number of directors. In many cases there is only one. In many family businesses the family members have always worked in the business, and have limited exposure to experience in other businesses or industries. These directors often feel overly burdened by the responsibility of their position and concerned about the liabilities they incur as a director.
To support directors in a family business it is common to establish a business advisory committee. Such committees act as advisors to the director or board of directors, but do not replace them, and do not exercise the powers of directors.
We have extensive experience in the formation of such committees and in preparing their charters and other governance documents. In many cases we are members of these committees.
We can undertake a detailed analysis of the needs of the business and in consultation with the business owners and the existing director or directors, will provide guidance as to how such a committee would be established and provide the support needed to do so. It is common for us to examine the skillset of the existing directors and business management structure, and assist in identifying any weaknesses or lack of experience, and recommend the skills which could be recruited to a business advisory committee. We then assist in the sourcing of the appropriate members.
An advisory committee could be made up of members with the following skills:
- accounting and finance
- human resource management
- marketing and business development
- strategy and governance
- risk and insurance
- transitioning the business to the next generation
- preparing the business for sale
- conflict resolution and mediation
- existing employees already engaged in the management of the business