Produced by Julie Garland-McLellan, Consultant at AltoPartners Australia and non-executive director and board consultant based in Sydney, Australia.

Contribution by Richard Sterling, is the Managing Partner AltoPartners Australia and focuses on Board and C-suite appoints in the For Purpose and Social Impact sector. He has three decades of consulting, executive and board search experience and is based in Sydney, Australia.

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The Director’s Dilemma - May 2025

This month we consider the plight of a director who suddenly finds himself at odds with a stance endorsed by the company.

Xan is a 1st generation Australian and loves his adopted country. He still has relatives in his birth country, which is riven by conflicts. As a highly qualified commercial lawyer, Xan, whilst unable to practise law without requalifying, has developed a satisfying career as an in-house commercial and contract manager for a large company. His boss encouraged him to study governance and, once qualified, join a relevant board to increase his network, enhance his business skills, and give him an opportunity to give back to society.

Xan found a local NFP that helps children of recent immigrants to become involved in sports and arts. He volunteered for a while then stood for election to the board and was delighted to get elected first time. He has now been on the board for two years. Last week the NFP published an endorsement of one of the parties engaged in conflict in his birth country. It’s on an opposing side to the one most associated with his family and region. Xan is hurt that he was not even consulted and a bit concerned that the conflict, and the parties to it, are not relevant to the activities of the NFP.

Naturally an introvert, Xan is considering resigning from the board rather than raise the issue with his colleagues or the ED. However, he still volunteers and loves the impact that the NFP has for children who need a boost to become engaged in their new community.

What should Xan do?

Richard’s Answer

Wow! I understand Xan’s hurt.

Having grown up, living and working in multicultural Australia, I’ve witnessed similar situations many times.

Many first-generation migrants draw strength and identity from living in close-knit cultural communities that provide social support and cultural continuity. Even as they embrace their new country, deep ties to their homeland endure.

In this context, the NFP’s endorsement may be causing Xan to feel shame or face backlash from his community with potential consequences such as marginalisation or demonisation. For his relatives in his birth country the repercussions could be severe.

From a governance perspective, the NFP’s public endorsement of one side in a foreign conflict, without full board consultation, is highly questionable and potentially damaging.

As a board member, Xan should have been included in a decision of such significance. The failure to do so raises serious concerns around governance processes as well as the board’s respect for Xan’s role and contributions.

Beyond Xan’s personal dilemma, the NFP must confront and justify how their making of such an endorsement aligns with their mission. Taking a partisan stance can erode community trust, damage reputation and jeopardise funding.

Xan must raise this for board discussion. By framing the issue around the NFP’s mission, community cohesion and reputational risk, he may help refocus the NFP on its core purpose.

However, if the board remains unwilling to course-correct or if Xan faces conflict with his community or fears for his relatives’ safety, then, despite his love of the NFP’s work with children, resigning from the board and stepping back as a volunteer may be the best course of action.

Julie’s Answer

That Xan has found out about this endorsement, with no prior communication or request for his input, after publication speaks volumes about the respect between the organisation’s executive leadership team and its board. Only an ED who believes the board to be distant and unengaged would take such a step without first raising the possibility in a conversation with the directors.

Xan should raise this issue during the board’s in camera session after first notifying the Chair that he intends to do so. This public endorsement is a major political risk that was not aligned to the strategic plan and seems to have been taken without board authority. Hopefully the other directors will agree that it is a regrettable lapse of judgement and the chair, with the board’s authority, can raise this with the ED.

If it is the first time the ED has stepped over the bounds of reasonable use of his position, then I would suggest the chair discuss it in a one on one meeting with the ED after the board meeting concludes. If it is something that continues or escalates a trend, then the conversation should take place with the whole board but no other executives present. The ED needs to know that the board are united and resolute that the strategy should not be placed at risk by virtue (or vice) signalling that does not align with a strategic and authorised plan of action.

If the board are not willing to give the ED clear boundaries around what can, and what cannot, be done using delegated powers, then Xan should start searching for another board that governs more effectively.