The Case for Directors: If you can spare the time and the expense of the reporting requirements that accompany a statutory board of directors, then you might consider establishing a directorate, says Northwestern's Ward. "When it's a legal commitment, the directors feel a deeper, broader sense of responsibility to the company, to all the stakeholders, and the well-being of the company and the institution -- to the continuity of the enterprise," he says. "Especially when there's an emergency."
The Case for Advisers: Still, Ward concedes that you'll get 80 percent to 90 percent of the benefit of a directorate from informal advisers, and most of the longtime small-business counselors Inc. interviewed recommended against chartering a board of directors. Even a company with a corporate structure that requires a formal board of directors might still want an advisory board, says Hansen. "On a board of advisers, I can give my best advice and not be constrained by the possibility that it's going to come back and bite me. It does change people's perspectives."
At www.inc.com/keyword/buildaboard, you will find many articles on the creation, care, and feeding of boards. "Friendly Persuasion" suggests strategies for swaying reluctant board candidates. "Four Tips for Working With Board Search Firms" lists boardroom consultants. "Weeding Out Weak Board Members" offers tips for evaluating boards and their members and dismissing them gently when it's time for a change. Several of the articles are drawn from Boardroom Insider (boardroominsider.com), an online newsletter.