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Factbox-What is embattled British business group the CBI?

Published Apr 22, 2023 08:19AM ET
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© Reuters. FILE PHOTO: A Confederation of British Industry (CBI) logo is seen during their annual conference in London, Britain November 9, 2015. REUTERS/Toby Melville/File Photo
 
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LONDON (Reuters) - The Confederation of British Industry (CBI) trade organisation has suspended all policy and membership work until June after a slew of businesses quit following staff complaints about workplace misconduct and allegations of rape by two women.

Below is some information about the CBI and its role:

WHAT IS THE CBI?

Founded in 1965, the CBI is Britain's top business lobby group. A not-for-profit organisation, the CBI says it represents 190,000 businesses employing nearly 7 million people, including many of Britain's biggest companies.

Headquartered in London, it has several regional offices around Britain and international offices in Brussels, Beijing, New Delhi and Washington.

Former presidents include John Allan, now chair of the supermarket chain Tesco (OTC:TSCDY), Mike Rake, the former chairman of BT Group (LON:BT) and Karan Bilimoria, founder of Cobra Beer, who remains the organisation's vice president.

According to its latest published accounts, the CBI's total income in 2021 was 25 million pounds ($31 million), of which the bulk - 22.2 million pounds - came from membership income. It also receives commercial income from running events, leadership programmes, surveys, data licensing and consultancy work.

WHAT IS ITS PUBLIC ROLE?

The CBI has a strong presence in the British media and has the ear of cabinet ministers, often trumpeting its success in lobbying the government over policy.

It has more than 100 economic and policy specialists, which it says represents the largest team of policy experts outside government.

In the government's March budget, finance minister Jeremy Hunt adopted some of the group's recommendations, including expanding support for childcare and allowing companies to offset 100% of their capital expenditure against profits.

Its annual conference is usually addressed by senior politicians, with both Prime Minister Rishi Sunak and the leader of the main opposition Labour Party, Keir Starmer, speaking at the 2022 event in November.

In his speech, Sunak called the CBI "a valued institution in this country and a powerful voice for business".

The organisation also produces regular economic surveys, providing data on the private sector and the conditions for businesses in sectors such as manufacturing and retail.

WHAT HAS HAPPENED?

Police opened an investigation last week into what the CBI called "a serious criminal offence" after the Guardian newspaper reported a female member of staff alleged she had been raped by a manager at an office party on a boat in 2019.

The Guardian on Friday also reported allegations by a second woman that she had been raped by two CBI colleagues when she was employed at one of the group's overseas offices. It also said another woman working for the CBI in London was stalked by a colleague in 2018 and discouraged from reporting him to police.

In a statement on Friday, the CBI's board expressed "shock and revulsion at the events that have taken place in our organisation".

The CBI has also been beset by broader allegations of workplace misconduct since March, which led last week to the firing of its director-general, Tony Danker, over separate staff complaints unrelated to the rape allegations.

HOW HAVE MEMBERS REACTED?

By the end of Friday, several major British corporate names including state-backed lender NatWest, retailer John Lewis and telecoms firm Virgin Media O2 as well as insurers Aviva (LON:AV), Phoenix Group and Zurich Insurance Group (OTC:ZFSVF) said they had quit the CBI.

Others, such as retailers Tesco, Sainsbury's and Marks & Spencer (OTC:MAKSY) as well as engineering company Rolls-Royce (OTC:RYCEY) and bank Santander (BME:SAN) said they were pausing or suspending their ties.

Earlier this month the government said it was suspending high-level meetings with the CBI.

CAN IT SURVIVE?

The CBI's board said on Friday it had "heard loud and clear a demand for far reaching change" and would suspend its activity while it gathers views on its future role and purpose.

It will hold an Extraordinary General Meeting in June at which it will put forward proposals for a "refocused CBI".

"Our members have told us in recent days and weeks that they believe in the importance of a collective voice to inform national policy ... but much needs to change if we are to win back their trust," it said.

But some have questioned whether the organisation can keep operating. A spokesperson for NatWest said the bank had no confidence in the CBI's capacity to be a strong representative voice for British business at present.

Andy Wood, chief executive of brewers Adnams, said the CBI had "run its course".

"It's a pity that it's happened in this way but I think industry can think better about how it represents itself and is represented to government," Wood told BBC Radio. "Probably the CBI brand is now beyond repair. I think it will have to reinvent itself, root and branch."

($1 = 0.8045 pounds)

Factbox-What is embattled British business group the CBI?
 

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