In a rare jump by a retail executive onto the masthead of a media outlet that covers her industry, Bobbi Brown, the makeup mogul, will take over Yahoo’s beauty section later this month, the company announced on Wednesday.

As editor-in-chief of Yahoo Beauty, Brown “will lead editorial direction, original content and the expansion and re-imagination” of the section, Yahoo said in a statement. Brown was quoted as saying that she would keep her role at her cosmetics company and that she was “confident that the two positions will inform and strengthen each other”.

Brown is the founder and leader of Bobbi Brown cosmetics, which is estimated to bring in more than 10% of the annual sales of parent company Estée Lauder. The average of estimates of annual sales at Estée Lauder through June 2014 is $10.7bn. Yahoo itself is less than half that size in terms of sales.

It was unclear whether any editorial restrictions would be put in place on Brown’s coverage, as Yahoo editor, of Bobbi Brown products – or on her coverage of competing cosmetic companies’ products.

"The thing that's surprising about this is it creates an absolutely obvious conflict of interest," said Kelly McBride, co-author of The New Ethics of Journalism and senior faculty member at the Poynter Institute. "The reason that people would turn to Yahoo Beauty is for independent news and analysis on a specialty topic. If you have an editor who has a vested financial interest in a product line, news consumers are automatically going to assume that that product line gets preferential treatment. And so it doesn't even matter if it actually does get preferential treatment, the perception alone will damage Yahoo's credibility."

Yahoo might try to address the situation by explaining its editorial process in a transparent way, McBride said, and by consistently delivering "what the audience needs when the audience needs it".

Asked to comment on the matter, a Yahoo spokesman released this statement: "Yahoo has very strict editorial guidelines and Yahoo Beauty will adhere to these standards just like all of our sites."

Brown's career began in the 1980s, when she worked successfully as a makeup artist in New York City, but her brand began in the early 1990s, when she launched her eponymous makeup line and quickly established a range that catered for an ethnically diverse customer base.

At a time when mainstream makeup ranges were dominated by bright colours aimed at white women, Brown showed an awareness of black and Asian skin tones years before her competitors by basing her ranges of a wide range of understated neutral colours.

Brown's ethos has always been about making the professional seem accessible for women everywhere. Years before YouTube tutorials became the norm, Brown appeared on TV showing women how to apply eyeliner and pick the perfect shade of foundation. The Bobbi Brown Makeup Manual became something of bible for makeup lovers.

“As [editor-in-chief], I’ll work to curate smart, strong content that will teach women how to be their best selves,” Brown said in a statement released by Yahoo. “Of course, it goes without saying that this new role will never take me away from my first love – Bobbi Brown Cosmetics. I’ll continue as Chief Creative Officer of the company, and am confident that the two positions will inform and strengthen each other.”

It is not unprecedented in the world of media for economic stakes to overlap uncomfortably with editorial interests. In a widely followed 2011 case, Michael Arrington, a founding editor of the influential technology site TechCrunch, came under fire for launching a $20m venture capital fund to invest in tech companies. Arrington was subsequently ousted from his editorial perch by parent company AOL. “It is very, very clear that they are distinct entities and Michael will have no influence on coverage,” AOL editor-in-chief Arianna Huffington told the New York Times’ David Carr at the time.

The announcement of Brown's hiring came a week after reports that Yahoo would undertake a major overhaul of its women-focused lifestyle section, currently known as Shine.

Under CEO Marissa Mayer, who took over in July 2012, Yahoo has gone on something of a shopping spree for big-name talent to lead its various media sections. Last November the company hired Katie Couric, the ubiquitous television news personality, as "global anchor," reportedly for a $6m salary. Yahoo also has hired David Pogue, formerly of the New York Times, as a technology columnist, and Josh Wolk, formerly of Vulture, as entertainment editor.