Sir Theodore Agnew has been confirmed as a new education minister, replacing Lord Nash.
The chairman of the Inspiration Trust, which sponsors schools in Norfolk and Suffolk, will be given a life peerage, and will take on the role unpaid, as did his predecessor.
The Inspiration Trust said he will step down from his position as its chairman. However, he will remain a trustee.
The DfE said Sir Theodore will be stepping away from all relevant business interests while a minister, and is agreeing arrangements with the permanent secretary and Cabinet Office "to ensure that processes are put in place to prevent any conflict of interest between his ministerial role and his charitable interests".
Mary Bousted, joint general secretary of the NEU teaching union, said: “He has a big job to do. He has to get a grip of standards in multi-academy trusts, sort out the admissions process so schools don’t select their own intake, and stop the misuse of public money through related party transactions, and be on the ball much quicker than his predecessor when it goes belly up, like at Wakefield City Academies Trust.
“If he can do all those things, that’s great, but I don’t think he can because the Department for Education does not have the systems or information to do that.”
His appointment was welcomed by Mark Lehain, director of the Parents and Teachers for Excellence campaign, which has a number of Inspiration Trust figures on its advisory council.
He said: "Theodore Agnew is an inspired choice to replace John Nash.
“He's someone who has literally put his money where his mouth is to improve the life chances of children in his home patch, and generally done so without drawing much attention to his own involvement.
“On top of this, he knows how to get stuff done – which is really important in a complex organisation like the Department for Education.
“Theodore's appointment confirms that the government remains committed to its reform programme, particularly around academies and free schools, and to doing it in an efficient and effective manner as possible."
However, Layla Moran, the Liberal Democrat's education spokesperson, raised concerns about his appointment, "not least because it appears Justine Greening is going to carry on the damaging policies of Michael Gove, which did so much to alienate and demoralise the teaching workforce".
She called for the new minister to "make guarantees that his own personal involvement in the free school movement will not stop him from being impartial when looking at the evidence of the many problems with the delivery of this programme".
Inspiration Trust spokesman James Goffin said: "Since founding the Inspiration Trust in 2012, Sir Theodore has made a massive contribution to improving education in Norfolk and Suffolk.
"He has given his time and expertise to growing the trust from a single school to a family of 14, and now includes some of the top performing schools in the region.
"He has also been a dedicated public servant as a non-executive director at the Department for Education, and more recently at the Ministry of Justice.
"We congratulate him on this appointment."