Welcome to the November 2014 edition of The Director’s Dilemma.
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Consider: If Melanie were your friend, what advice would you offer her?
Melanie is on the board of a long-established and well-respected not-for-profit company. The CEO was appointed several years before Melanie joined.
Melanie has known for some time that the CEO had a daughter who was employed by the company in the accounts department.
Recently she discovered, through a chance encounter at the local library with the company’s administration manager, that the CEO’s son-in-law is also employed there and that her brother is the personnel officer. On asking fellow board members about the CEO’s relationships with staff she discovered that there is also a niece working for the company and another daughter who is CEO of the printing firm which does all the company’s printing and graphic work. No director can remember approving, or even seeing, any contract for the printing or having any discussions about the employment of the CEO’s family members by the organisation.
There are no apparent problems with efficiency, qualifications or remuneration for any of the employees or for the contract with the printing firm.
It does seem to be quite a coincidence that the CEO should have so many family ties with the company and Melanie is not sure what, if anything, the board should do.
How would you advise Melanie to proceed from here?