LONDON: Britain’s scandal-hit business lobby group, the CBI, faces a vote crucial to its survival Tuesday, with members urged to back reform under new leadership after allegations of sexual harassment by staff.
The Confederation of British Industry risks folding after claims that more than a dozen women were sexually harassed at the organization and two others had been raped.
Police have launched an investigation following the allegations reported this year by The Guardian newspaper, triggering a shake-up at the organization and an extraordinary vote on its future.
The allegations, described as “absolutely devastating” by new CBI director general Rain Newton-Smith, caused an exodus of member companies — and the launch Monday of a rival body by the British Chambers of Commerce (BCC).
Newton-Smith, who has described the situation as a “really deep and painful crisis” for the CBI, told an extraordinary general meeting Tuesday that she was “confident and determined this will be a turning point for us, the start of a new chapter, for a renewed CBI.”
She added: “We’re ready to deliver a better CBI. We just need one thing now — your vote.”
The resolution being voted on Tuesday calls on remaining member companies to put their confidence in CBI proposals to reform its “governance, culture, and purpose.”
The organization has proposed the creation of a People & Culture Committee plus an external expert-led Culture Advisory Committee.
And it has created the role of chief people officer.
At the same time it is cutting jobs as the reduction in members slashes revenue.
The scandal comes as UK businesses look for leadership during a cost-of-living crisis, with the country’s elevated inflation cooling more slowly than expected.
In a move seen as taking advantage of the crisis, the BCC has launched the rival Business Council.
“We have been talking to the nation’s largest corporates and it has become clear to us that they are looking for a different kind of representation,” said BCC director general Shevaun Haviland.
Founding partners include British energy group BP and Heathrow airport.
But Newton-Smith said Tuesday that a revamped CBI could still be a powerful driving force, with its depth of expertise and practical business insights over decades.
“Even our competitor groups have admitted they can’t match all that.”
About one dozen firms, including engineering giant Siemens, Microsoft and oil firm Esso, have signed a joint letter published in The Times newspaper backing the CBI reforms.
The signatories said that while the “CBI has recognized its failings,” they “will hold it to account on putting its plan into action.”
The letter added that “as the UK faces strong economic headwinds and anaemic growth and with a general election expected before the end of next year, it is vital that there is a credible voice representing all sectors and sizes of UK business.
“The CBI can do this.”
It comes after major companies including Unilever, UK bank NatWest and BMW Group canceled their membership.
Others have suspended their involvement — and cannot vote on Tuesday — while the UK government has distanced itself from the CBI.
Newton-Smith took over from Tony Danker, who recently departed over a separate misconduct allegation.