CBI faces crunch vote in battle for survivalon June 5, 2023 at 11:01 pm

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The business lobby group is seeking a vote of confidence from members after a series of scandals.

Rain Newton-Smith, director general at the CBIImage source, BBC

The CBI business lobby group is holding a pivotal vote later about its survival following a series of scandals.

Its members are being asked if changes the group is making to how it is run give them “the confidence you need to support the CBI”.

The CBI has been rocked by a number of claims, including serious sexual assault, and firms such as John Lewis and ITV have left it as a result.

The government has also suspended its engagement with the lobby group.

The CBI is one of the UK’s biggest business groups, representing about 190,000 companies who employ millions of people.

What does the CBI actually do?

The UK is home to millions of businesses. They need the government to listen to them when they want help on a range of issues such as employment and taxes so they can grow their companies and, by extension, fuel the UK economy.

Instead of lots and lots of disparate businesses asking the government for things, a group like the CBI finds out what the most pressing issues are for firms and it speaks on their behalf.

The CBI can affect day-to-day life for everyone. In the early days of the Covid pandemic, it helped with the rapid rollout of the government’s furlough scheme that kept many people and businesses afloat.

What has happened at the CBI?

In early April, the Guardian newspaper published a number of allegations in which more than a dozen women claimed they had been victims of varying degrees of sexual misconduct by people at the CBI.

This included an allegation of rape at a CBI summer party in 2019.

Following the report, the government “paused” its engagement with the lobby group.

The newspaper published a further rape allegation later that month, involving a woman who worked in one of the CBI’s overseas offices who claimed she was assaulted by two colleagues.

The City of London Police is investigating both claims.

Businessmen against City of London backdrop

Image source, Getty Images

Even before these reports, the CBI’s director general, Tony Danker, had stepped aside in March following separate complaints about his conduct at work. He was subsequently sacked and is now considering legal action.

He was replaced by the CBI former chief economist Rain Newton-Smith.

Fox Williams, a law firm, was asked by the CBI to examine whether the group’s management was aware of the claims made in the Guardian and if so, what action was taken.

When the second rape allegation emerged, several big name companies cancelled or suspended their membership of the CBI.

Among those who quit were John Lewis, ITV, Aviva, the insurance giant and banking group NatWest.

What happens next?

Put simply, Tuesday is make-or-break day for the CBI, which has been operating for nearly six decades.

The lobby group will ask members and trade associations to vote on this key question: “Do the changes we have made − and the commitments we have set out − to reform our governance, culture, and purpose give you the confidence you need to support the CBI?”

The CBI refused to say how exactly many members it has but some, including Microsoft, have broken cover to say the lobby group has their backing to continue.

The result of the vote is expected at around 4pm.

The CBI says it has taken steps to improve its culture as well as the structure of dealing with complaints. It has created the role of chief people officer to sit on its board, whereas before there had been no representation from human resources at that senior level.

It also put in place a confidential whistleblowing channel outside the CBI and asked an external human resources consultancy to examine any further complaints of misconduct while its own internal processes are being reformed.

It is also working with Principia, a group which advises on “building ethical organisations”. So far, it has found “the CBI does not have a toxic culture” but there are areas that need improvement.

But the exodus of fee-paying members is already being felt by the CBI.

The group, which employs more than 250 people in the UK and has additional staff overseas, is planning job cuts.

And it has also, according to Sky News, sought legal advice on filing for insolvency should Tuesday’s vote not go its way.

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