A senior manager in work today asked me to apply for a position she's got within her dept. I told her I wasn't interested as it would be an effective step down. She'd interviewed 2 candidates today so I asked how they'd gone and she told me the first one wasn't suitable and gave legitimate reasons. I asked about the second and she said "I don't want her. She's black. I don't want a black in here".
I got called away, but I told her I'd talk to her later. I didn't get a chance but I'm really angry and very, very disappointed in her. Now I don't know what to do. I can speak to her personally and tell her I think she's a dirty racist bitch, which isn't really ideal given that she's senior to me; report her to someone senior to her (ie. the board), which would still cause murder because she'd know it had come from me; or pretend it never happened.
Which of the 3 options would you choose?