The law requires a corporation to have a board of directors to protect the interests of the corporation and shareholders. However, there are other reasons to have an active board of directors.
Many corporations fill positions on the board with family and friends for various reasons.
Small companies, especially family-run businesses, tend to distrust outsiders and don't want to give up control of the company. However, the benefits of having a truly independent board will usually outweigh the drawbacks. Board members can provide perspective and experience to a company that the insiders might lack. If board members themselves are entrepreneurs, they can help the insiders avoid common mistakes. Having experienced business persons on the board also gives the company credibility.