Tourism Australia has backed its chairman Geoff Dixon, despite Qantas shelving its $50 million deal with the organisation.
Qantas claims Mr Dixon has a conflict of interest, because he is part of a group of investors agitating for change at the airline.
Geoff Dixon is the most recent former chief executive of Qantas, whom Alan Joyce took over from in 2008 when Mr Dixon retired from the airline.
The official tourism agency says Mr Dixon will remain as chairman, because any conflict of interest he has is "manageable".
Mr Dixon is part of a high-profile group of investors seeking changes at Qantas, which could include floating Jetstar and selling off the airline's Frequent Flyer program.