The CBI’s business lobby group won a confidence vote on Tuesday after allegations of misconduct, but received no firm commitment from ministers to immediately re-engage with the organisation.
The CBI, which has been blocked by the government following allegations of sexual and other serious misconduct at the group, said the vote had passed by a margin of 93 percent to 7 percent.
But the CBI declined to reveal what proportion of its member companies and trade associations had supported the organization in the vote of confidence at an extraordinary general meeting in the City of London.
CBI members had been asked to vote on whether the group’s proposed overhaul of its leadership, governance and culture gave them confidence in the organization.
The vote followed 12 weeks of crisis at the CBI after claims of misconduct at the organization were published in The Guardian, including two rape allegations now under police investigation.
CBI leaders hope the vote will pave the way for ministers to resume relations with the organization and for members who have suspended their affiliations or dropped out to resume involvement with the group.
Rain Newton-Smith, director general of the CBI, said she was grateful for the support of members. “We have made real progress in implementing the top-to-bottom change program promised by the (CBI) board and while there is still work to be done, today’s result represents an important milestone on that journey,” she added please.
The CBI said a total of 371 votes had been cast, with 23 abstentions on their ballot.
However, it did not disclose the total number of members eligible to participate in the vote, leaving turnout levels unclear. Companies that dropped out after the recent allegations, such as Aviva and John Lewis, were not eligible to vote.
The CBI’s website refers to regular meetings with 700 members, but it said on Monday that number “does not represent our total membership.”
This suggests that less than half of the organization’s members supported it in the confidence vote, or that the total fell sharply during the crisis.
“The fact that 371 organizations voted to support the CBI is clearly a positive result,” said Leo Martin, general manager of business ethics consultancy GoodCorporation.
“However, given the organization claims to have over 700 members, there is still a long way to go to get all members on board with the proposed reforms. This is obviously crucial to build momentum and get the CBI back on its feet.”
An executive from a company that has left the CBI was more critical, saying the group “has the guts” to claim the result was a vote of confidence.
The future of the CBI now largely depends on whether the vote is enough to convince ministers to re-enter so that the group can attempt to influence government policy.
The government said: “While this is a matter for the CBI and their internal processes, we will continue to contact companies and corporate groups as appropriate on a case-by-case basis.
“The CBI is responsible for restoring the confidence of their members and that remains their business.”
Government officials do not expect to resume communication with the CBI immediately. “That’s something they’ll be thinking about within the (Department for Business and Trade) in the coming days,” an official said.
The CBI will also have to convince companies and trade organizations to renew their memberships when they expire, as many companies’ current subscriptions expire in early 2024.
The group’s finances have already been hit hard by members leaving, and staff are bracing for layoffs as the CBI aims to cut wage bills by a third.
FTSE 100 groups Shell and SSE, who suspended their membership following the misconduct allegations, said they had supported the CBI in the vote of confidence.
Shell said it would “evaluate progress” before deciding whether to renew membership later in the year.
Imperial Brands said it had abstained from the vote of confidence but was “encouraged” by the CBI’s proposed changes and that the group now needs to convince members by keeping its promises.
Anglo American, Rolls-Royce, BT, Flutter and PwC also abstained, according to experts.
However, more major CBI members have left the CBI in recent weeks. BP and Tesco, who previously suspended their membership, have now left.
In a joint statement, a group of trade associations including the British Retail Consortium and National Farmers Union welcomed “the CBI’s recognition that it needs to change” and that they were “ready to support the changes proposed by the lobby group”.
David Wells, CEO of trade organization Logistics UK, said that while there is clearly an important role for an organization to represent all companies at a national level, it remains to be seen “whether that is CBI or not”.
Logistics UK and the Recruitment & Employment Confederation both supported the CBI in the vote of confidence, but their memberships remain suspended.
The threats to the CBI include a new works council formed this week by the British Chambers of Commerce for companies seeking “a different kind of representation”. BP and Heathrow were among the four founding members of the council.
Additional reporting by Oliver Barnes, Anna Gross, Leslie Hook, Hannah Kuchler, Laura Onita, Rachel Millard, Sylvia Pfeifer, Madeleine Speed, Daniel Thomas and Tom Wilson
