Outside Advisory Board It is important to have a formal structure in which owners and shareholders can communicate and work on their common interest for the business. The ownership area is the wealth capital of the business and requires many structures to protect that wealth while ensuring future ownership is delegated equitably and fairly. Bringing in a fresh viewpoint from outside the family has proven very valuable for many family businesses. It has kept discussions focused and objective. This person can be one of your trusted advisors, a trusted friend, or a fellow entrepreneur.

Not only will this structure enable Ownership issues to be dealt with separately from Management and Family issues, it also allows for ongoing communication between the owners and those who manage the business as the Ownership Board Members appoint or elect the Board or Directors or Management Board members.

The purpose of an Ownership or Advisory board is to ensure that the shareholders focus on the direction of the business for the long-term (60 months). This plan should include an Estate or Wealth plan that allows for some choice and is fair and equitable for the inheritors.

There are a large number of financial, tax and legal tactics that are important to this area of the business. It is crucial that your accountant, lawyer and financial advisors work together in developing strategies for the ownership area of the business and implement the right strategies to move your family in the direction you want to go.

Benefits of Establishing Ownership/Outside Advisory Board

• Implementing formal processes for this area of the business will ensure that the appropriate people communicate their ideas and work together for the common interest.

• You will create a more unified ownership group who are guided by a mentor or a trusted advisor - people who can help you look at your business as something to work ON, not just work IN.

• By implementing an ownership or advisory board, your shareholders have the opportunity to look to the future and together move the business to where you want it to go. You can look at the long-term goals of the business and communicate these goals to the people who manage the day-to-day operations.

• Additionally, the objective of this group is to ensure that all shareholders are treated fairly and equitably and that each has the ability to exit the ownership should they wish to do so.

For more information, contact us today.