A Battle Standard Bearer can join a unit of troops in the same way as any other character. If he is with a unit that is fighting in close combat then the unit receives an extra +1 combat bonus when working out combat results if the Battle Standard Bearer is placed in the front rank of the unit.
Troops fighting alongside their banners only receive +1 no matter how many banners are involved. A unit with both a Standard Bearer and the Battle Standard Bearer will only receive +1 Combat Result bonus.