Want a world-class board of advisers? Be careful what you wish for, unless …

“You say you want the truth … but you can’t handle the truth.” Paraphrasing this famous line from the 1992 military courtroom movie, “A Few Good Men,” sums up the perils of forming a board of advisers.

If there were an instruction manual of how to utilize a board, it would come with a black box warning: “Beware! Proceed only if you want the truth. Failure to provide full disclosure, listen and learn could prove detrimental to success.”

There are all types of boards. Most common is the traditional public company board that requires members to have a fiduciary obligation not to the CEO or nominating committee, but instead to the real owners of the business: shareholders. For privately held enterprises, there are more flexible advisory boards that are not governed by regulations and are assembled to assist management in navigating the road to success.

Gone are the days of the “good old boys’ networks” who served on each other’s boards and perfunctorily accepted whatever management said as gospel. In this new era of full transparency, there’s just no room for these types of boardroom love-fests.

The biggest challenge today for all types of boards, as well as management teams in both public and private organizations, is to understand and respect each other’s role and how each fits into the mosaic of the organization. In its simplest form the job of management is to run day-to-day activities. The responsibility of outside directors is to guide management on a big-picture basis and stay out of the weeds of the how-tos of completing tasks. Problems arise when either side crosses their respective line.

For many years I was CEO of a publicly held Fortune 500 company. During difficult times I would have a reoccurring nightmare that I served on my own board as an independent, outspoken director. Invariably every time I dreamt of board meetings gone bad, spurred by my hard-to-answer questions, I woke up trembling in a cold sweat.

Now I have moved to the other side and serve and have served on a number of quality boards. What I’ve learned is that management and directors should not be in an adversarial relationship, but instead work in partnership to achieve optimum success without fear of retribution for surfacing sensitive subjects. Relics of the past include board members I call “nodders,” who politely shook their head “yes” to everything, sometimes even before being asked.

If your company already has a board, learn to use it effectively by keeping members informed about the good, the bad and the ugly before they hear it outside the boardroom. This makes them a part of the solution, not the problem. As for directors, they best serve management by not being beholden to them, telling them only what they want to hear, but rather by guiding, nurturing and nudging the team.

If you’re a public company, you’d better already know these rules of engagement between management and a board. If you’re a private entity, and are considering adding an independent advisory group, do so only if you can handle the truth.

Visit Michael Feuer’s new website www.TipsFromTheTop.info to learn more about his columns, watch videos and purchase his books “The Benevolent Dictator” and “Tips From The Top.”