Here’s the story:

"I am a senior staff member at a mid-sized nonprofit. My ED has crossed the line regarding our organization’s conflict of interest policy, using her position to benefit herself and a family member financially. It’s not the most egregious situation you could imagine, but it is clearly unethical and happening out in the open. I am concerned about how this looks in the community. I spoke to our board chair about it, but he dismissed my concerns. I know he has a personal friendship with the ED, and I worry this has influenced his reaction. Any tips on how to navigate this in a way that protects our organisation’s reputation?"

And here’s my take:

I don’t know the nature of this conflict, the details of your organisation’s conflict of interest policy, or the jurisdiction your organisation operates in, so I can’t comment on the specifics of your situation. I’ll take you at face value when you say the incident you’re writing about is a clear conflict of interest—but it sounds like this issue doesn’t rise to the level of what might be considered fraudulent activity. So let’s look at it from this perspective: your ED is behaving unethically, has violated organisational policy, and your board chair seems unconcerned!

I’ve found that, in many cases, boards don’t effectively manage staff concerns or complaints about the ED. While the board chair’s personal relationship with the ED might influence this situation, I suspect a few additional dynamics are also at play:

1. A lack of understanding around conflict of interest. Many people struggle to understand conflicts of interest, and nonprofits often misapply these policies—including EDs and board chairs.
   
   
2. Difficulty (or discomfort) applying policy. Implementing policy in real-life situations can be challenging, and many nonprofit boards prefer informal governance over strict policy compliance—leading to issues like this.
   
   
3. Unclear process. Without a clear procedure for handling staff concerns or complaints, it’s likely the board chair doesn’t know how to handle your report.
   
   
4. Conflict avoidance. Managing the ED-board relationship is one of the most critical and challenging aspects of governance. Boards often ignore problematic ED behaviour to avoid uncomfortable conflict.
   
   

Where does that leave you? There are a few potential paths for you to consider, but I do want you to consider that taking this issue further may open you up to the risk of reprisal from the board or your ED. 

Follow up with the board

Board chairs often act as gatekeepers, so it’s not safe to assume they’ve shared your concerns with the full board. They may have brought it to the board without informing you—or they may not have shared it at all. Consider emailing the board chair to follow up, copying another relevant board member (e.g., vice-chair, governance committee chair, or HR committee chair). This creates a written record and may push the chair to address the issue. However, even if the board acts, you may never know about it.

Talk to your ED directly

If you have a positive relationship with your ED, consider addressing the issue with her directly. She may not recognise her actions as a conflict of interest. Framing the conversation as a “friendly heads-up” about reputational risks could make it constructive rather than confrontational.

Share your concerns in the ED’s performance review

Boards should monitor the ED for policy compliance, though many do not. If your board conducts annual ED performance reviews (and if they gather input from senior staff), this could be an opportunity to raise your concerns. Again, HR confidentiality means you may never know the outcome.

Let it go

Ultimately, the board’s actions — or lack thereof — are beyond your control. You can take pride in the fact that you did the right thing by reporting the violation, and since this situation doesn’t involve fraud or harm, you may decide your ethical obligation is fulfilled and step back.

If that feels unsatisfactory, consider advocating for the development of a complaints and whistleblower process at your organisation. Even small nonprofits benefit from having a clear, transparent process for reporting and addressing concerns. I’ve designed these policies for organisations, and they can prevent issues like yours by ensuring all parties are treated fairly and consistently.

Big Takeaways:

• Don’t assume board chairs are always transparent with the full board; they often filter or withhold information deemed inconsequential or disruptive.

• Strong conflict of interest policies with clear examples and accountability processes are crucial for every nonprofit organization.

• A robust complaints and whistleblower process benefits organisations of all sizes.