A board of directors is a set of individuals who are responsible for the governance, control and direction of an organization. They are accountable for the legal obligations of a company and are held to a high level of accountability. If they fail to meet their fiduciary duties, they may be personally accountable.
A group of individuals who advise and guide the company is called an advisory board. The advice they give is more practical, and their focus tends to be on growth, development and strategy, rather than reporting and governance, managing risk and avoiding risk of downside.
Idealy, an organization should clearly define the role of its advisory board in all official documentation like https://theirboard.com/what-it-takes-to-be-an-effective-board-member/ meeting minutes, as well as in oral communications to avoid confusion. This will ensure that they do not accidentally cross over into the territory of a board of directors and could result in serious legal consequences in the event that they fail to fulfill their fiduciary obligations.
The distinction can get a bit ambiguous in real life, with organisations sometimes referring to their advisory boards as “the board.” It’s worth putting this in writing, both for the sake of clarity and to avoid accidental missteps. A formal written statement defining the purpose of an advisory board will help to minimise the risk of confusion for those involved. This is particularly useful when members of the advisory committee may be members of the board of directors or are new to an organisation.