Grainne Moss has confirmed Oranga Tamariki deputy chief executive Hoani Lambert has resigned, but she herself is not stepping down.
Moss has been speaking to media after appearing before the Waitangi Tribunal as chief executive of Oranga Tamariki.
She says Lambert is going to the Department of Internal Affairs.
Moss says no one from the leadership team has raised concerns about her.
Asked how she justifies keeping her job, she says she believes she has the full confidence of her team.
She says she's looking forward to continuing the work of Oranga Tamariki.
She believes the country's institutions have a structural racism problem - as well as the country at large.
"I think that society has a structural racism problem, and all of our institutions have a structural racism problem ... the concessions were made, they were well considered."
Lambert has told RNZ's Checkpoint he is a professional public servant and had been given the opportunity to move to another role.
He says he is very grateful to her for her support and he believes she is up for the job of turning Oranga Tamariki's performance and resolving the taking of Māori babies from their whānau.
Regardless, he says Moss has not played a part in his departure from his role.
"I'm a professional public servant, I've been with Oranga Tamariki for four years. Another opportunity presented itself with the Department of Internal Affairs and I was lucky enough to secure that role."
Lambert says Moss is up to the job as chief executive and he thinks she showed that at the Waitangi Tribunal today.
"We were essentially being asked to try and transform a system... that was seriously suboptimal in the first place. What you saw in Hastings was absolutely unacceptable, however, that was the organisation that we inherited."
"We've learnt from that, we put in place measures to ensure that there was greater scrutiny around those applications and ... despite the cases, the reviews, I feel that we have made some ground as an agency."
He says Moss has tried her very best with the system they inherited.
He says being Māori is an important attribute but is not the sole attribute required for the role.
"I think we need to make sure that we have leaders in the public service who are able to discharge the responsibilities of those departments.
"I'm Māori, Grainne is not. I don't think that I am capable of running this agency."
Lambert said he might be able to lead such an agency in 10 years but it is certainly not something he could do right now.
"I think it's very much about the individual skills of the people... I don't have te reo, I've been colonised as a lot of Māori have, so that's a journey that I need to work on myself. But being Māori I do think is an important attribute, but I don't think can be the sole attribute for such an important role as this one."
Lambert says he does not think the environment for Māori in senior leadership in the public service is hostile, but it is challenging.
"I think you're asked to walk in two worlds. That is the nature of the Treaty partnership.
"Each public servant, Māori, brings with them their own history of colonisation, urbanisation, and always trying to work to see how they can walk in those two worlds."
He thinks Oranga Tamariki is doing a good job.
"I can say that on the basis of the work I've seen my team do, the relationships they've built with iwi."
The government of the day will enable the transformation that is required, he says, and the kinds of things Children's Minister Kelvin Davis has been talking about with the agency leadership has matched the goals he and his team have been aspiring to.
Moss says Oranga Tamariki is not enough to address the problems on its own, but has been privileged to partner with a range of iwi.
"It means a commitment to working together differently, to get better outcomes from tamariki."
She says every situation is dealt with on a case-by-case basis.
"We all need to lead the change together".
She says she has had a very constructive relationship with Children's Minister Kelvin Davis so far.
She was expected to speak to media about 5pm but cross-examination continued at the Tribunal for another half hour.
Moss last month refused to step down following a submission to the Tribunal's urgent inquiry into Oranga Tamariki in which she admitted the Children's ministry was yet to eliminate structural racism, or fully adopt the recommendations of a 1998 report.
Minister for Children Kelvin Davis had refused to express confidence in her leadership.
Moss has been under pressure since a Newsroom investigation into attempts by social workers to remove a week-old baby from its mother in Hawke's Bay sparked multiple inquiries and reports.