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Building an Advisory Board
When Do You Need It and What Value
Does It Add?
MARK S. DAILEY
Partner, Newport, LLC
mark.dailey@newportllc.com
203.424.0433
Welcome &
Introduction
Fiduciary Boards vs Advisory Boards
Fiduciary Boards
• Duty of care to protect all shareholders
• Duty of loyalty
• Votes count!
• Committees: Audit, Nominating and Governance, Compensation, Risk
Advisory Boards
• Non-binding, votes don’t count!
• Can’t fire you, can’t force management action
• Possibly no committees
Privately-Held Businesses
Private Equity Owners
• Board is comprised of the major investors
Founder-led
• Board can range from informal to formal
2nd Generation-Owned
• Board could be family and founder offspring
3rd and Subsequent Generation-Owned
• Family members may be employees or non-employees
• Avoid family tree champions
Advisory Boards for Privately-Held Companies
A Spectrum of Possibilities
• Board of friends
• Current family advisors (legal, financial)
• Family council
• 2nd generation vs subsequent generations
• Family majority
• Non-family majority
• Board of Business Development contacts
Benefits of Advisory Boards
• Business Development
• Adjacent market experience
• Fill skill gaps in the executive team
• Geographic expansion
• Drive strategy and performance
• Strategic vs tactical frame of mind
• Objective insights
Best Practices of Advisory Boards
Treat your advisory board the same way a public company
treats its fiduciary board
• Set the meeting schedule 12-18 months in advance
• Set the agenda and stick to it
• Respect your boards’ opinions and time
• If you have multiple shareholders, keep minutes
• Respect your hat
Questions?
MARK S. DAILEY
Partner, Newport, LLC
mark.dailey@newportllc.com
203.424.0433
Thank You
F o r Wa t c h i n g & L i s t e n i n g
UPCOMING WEBINAR:
MODERN DECISION SUPPORT – WHAT GREAT FINANCIAL PLANNING AND
REPORTING LOOK LIKE
February 10, 2022 | 12:00 PM ET/9:00 AM PT
Featuring: Dominic DiBernardo, Partner

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C-Suite Snacks Webinar Series: Building an Advisory Board

  • 1. Building an Advisory Board When Do You Need It and What Value Does It Add?
  • 2. MARK S. DAILEY Partner, Newport, LLC mark.dailey@newportllc.com 203.424.0433 Welcome & Introduction
  • 3. Fiduciary Boards vs Advisory Boards Fiduciary Boards • Duty of care to protect all shareholders • Duty of loyalty • Votes count! • Committees: Audit, Nominating and Governance, Compensation, Risk Advisory Boards • Non-binding, votes don’t count! • Can’t fire you, can’t force management action • Possibly no committees
  • 4. Privately-Held Businesses Private Equity Owners • Board is comprised of the major investors Founder-led • Board can range from informal to formal 2nd Generation-Owned • Board could be family and founder offspring 3rd and Subsequent Generation-Owned • Family members may be employees or non-employees • Avoid family tree champions
  • 5. Advisory Boards for Privately-Held Companies A Spectrum of Possibilities • Board of friends • Current family advisors (legal, financial) • Family council • 2nd generation vs subsequent generations • Family majority • Non-family majority • Board of Business Development contacts
  • 6. Benefits of Advisory Boards • Business Development • Adjacent market experience • Fill skill gaps in the executive team • Geographic expansion • Drive strategy and performance • Strategic vs tactical frame of mind • Objective insights
  • 7. Best Practices of Advisory Boards Treat your advisory board the same way a public company treats its fiduciary board • Set the meeting schedule 12-18 months in advance • Set the agenda and stick to it • Respect your boards’ opinions and time • If you have multiple shareholders, keep minutes • Respect your hat
  • 8. Questions? MARK S. DAILEY Partner, Newport, LLC mark.dailey@newportllc.com 203.424.0433
  • 9. Thank You F o r Wa t c h i n g & L i s t e n i n g UPCOMING WEBINAR: MODERN DECISION SUPPORT – WHAT GREAT FINANCIAL PLANNING AND REPORTING LOOK LIKE February 10, 2022 | 12:00 PM ET/9:00 AM PT Featuring: Dominic DiBernardo, Partner