You Need A Board
When most small business owners hear the word board, their first thought is of large corporations, charities, or heavily funded startups. A board can feel like a luxury or something for later, once revenue has hit a certain threshold or investors demand it.
But that mindset overlooks one of the most powerful levers for growth. For small businesses, and especially those run by underrepresented CEOs, building a board early can be transformative. A board is not just about compliance. It is about governance, accountability, and access. It is about shifting a business from surviving to scaling.
I have mentored countless businesses or was asked for business advisory when scaling, and I would often ask about the board, but was met mostly by “Nah, not yet” or “How much will it cost?”
And yet most of the most successful growing organisations I have worked with are around executive and leadership development. All have a board.
Success leaves clues.
In this article, I want to explore why this is important by looking at it through the lens of three areas:
Why do you need a board?
How to build your boards, from advisory to executive
How to measure whether your board is effective
1. Why Do You Need a Board?
On the day to day, small business CEOs are often pulled into firefighting—customer issues, cash flow, staffing - instead of steering the ship strategically. It’s easy to stay stuck in the weeds. A board forces time and space for higher-order thinking. There is more than enough evidence out there that shows boards that engage more deeply in strategy are linked to stronger long-term performance. For a small business, that strategic pause can mean the difference between plateauing and unlocking new markets.
Boards provide accountability and guardrails. Without oversight, decision-making can become insular. For underrepresented CEOs, this is doubly challenging. External funders and stakeholders often apply greater scrutiny, while internal teams may be hesitant to challenge the leader. A board provides an accountability framework that strengthens trust with employees, investors, and partners. The Harvard Business Review has argued that robust governance increases resilience in smaller firms by ensuring leaders are not left isolated at the top.
Let us address networks and access. Board members don’t just bring wisdom, they also access to doors. A well-chosen board connects CEOs to capital, clients, talent, and partnerships. For CEOs facing systemic barriers or just limited access, this kind of resource can be game-changing. Small Business Britain notes that underrepresented founders are significantly less likely to access growth finance, and boards can help close that gap.
2. How to Build Your Boards: From Advisory to Executive
Advisory boards are often the best first step. They carry no legal responsibilities but provide perspective, sounding boards, and networks. Early advisory boards can be made up of mentors, experienced peers, or sector experts. The structure is flexible: quarterly meetings, defined roles, and clear terms of reference. The key is clarity of expectation.
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The next step from such a board is to develop an executive board. An executive board (sometimes called a fiduciary board) has formal governance responsibilities—overseeing compliance, financial integrity, and long-term direction. They are accountable to regulators and, in some cases, shareholders. For many small businesses, this transition happens as you grow, investment increases, risk grows, or the business seeks institutional credibility.
So what should you look for?
When building either type of board, consider the following.
Skills balance. A director with finance, strategy, HR, marketing, legal, and sector expertise.
Diversity of thought. Look for talent with experience and perspectives that reflect your markets and stakeholders.
Values alignment. Ensure the people have the same values that build trust.
Capacity to challenge and support: The best boards will do both. Without apology.
Board members should be valued. In smaller businesses, this doesn’t always mean six-figure stipends. Options include equity, honorariums, per-meeting fees, or access to services. The principle is respect: if the business expects serious input, there should be fair recognition.
You don’t have to break the bank, some non-executive or executive directors are happy to accept a small stipend or share of equity. You have to think about what the return on having that expertise is worth to you and your company
3. Measuring the Effectiveness of the Board
A board is only as valuable as the impact it delivers. CEOs should regularly ask about
Strategic Value: Is the board helping us anticipate trends and shape direction, or are meetings bogged down in operations?
Accountability: Are we measuring performance against agreed goals and being challenged where needed?
Access and Networks: Have board members introduced us to opportunities we wouldn’t have had otherwise?
Diversity and Inclusion: Does the board reflect the communities we serve and bring in multiple perspectives?
Engagement: Are board members active, prepared, and contributing—or simply lending their names?
We use The BRAVE Board Diagnostic to help founders, but other frameworks like the UK Institute of Directors’ Board Effectiveness Guidance or Spencer Stuart’s annual Board Index can offer practical benchmarks, even for small businesses.
For small businesses—especially those run by underrepresented CEOs—building a board is not an afterthought. It is a discipline that embeds governance, accountability, and access into the DNA of the company. Done right, a board becomes less about ticking boxes and more about creating a culture of strategic thinking, shared responsibility, and long-term growth.
The earlier you start, the stronger your business will be when the stakes get higher.
