Britain’s most prominent business lobby group, the Confederation of British Industry, has put forward proposals to overhaul its culture and recruit a new president as it prepares for a confidence vote by members next week that will decide the organisation’s future.
More than 50 of the CBI’s highest-profile members left or suspended their relationship with the body after the Guardian revealed a series of sexual misconduct allegations, prompting the government and the Labour party to suspend engagement.
“I have my eyes wide open about what we need to learn,” the group’s new director general, Rain Newton-Smith, told the Guardian. “People need to know the code of conduct and we need to lay the foundations for a strong speak-up environment.”
As part of its drive for change, the group has accelerated its search for a new president. The incumbent, Brian McBride, will hand over responsibilities in January after overseeing a range of changes from the board downward.
In the foreword to a prospectus published by the CBI on Wednesday, he told members: “We are all chastened by the events of the past 12 weeks.”
The allegations that prompted the cultural overhaul include rape, other sexual misconduct and drug-taking.
“Whilst striving to represent and support our members to the highest standards, we simultaneously underestimated the daily effort required to maintain a great culture and the operational excellence of a growing CBI,” the outgoing president said in the prospectus. “The consequences of that failure, you already know. We share a deep sense of responsibility to put things right.”
Ffion Hague, an expert in board evaluation, has been asked by the CBI to lead an external examination of its governance and processes. Hague, whose husband is the former Conservative leader William Hague, has advised boards of companies including the mining giant Rio Tinto and the retailer M&S, according to her website.
The CBI said it would create a “culture advisory committee”, while “strengthening our internal listening channels with staff”.
The prospectus sets out Newton-Smith’s pitch to members, who will give their verdict in a confidence vote, with the results due to be announced after a crunch meeting on 6 June. Voting opened at 11am on Wednesday and will run into next week. The resolution, published on Wednesday, asks: “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?”
Businesses that have suspended their membership, rather than terminated it, will still be able to take part in the poll.
The plan follows an open letter to members in April in which McBride conceded the organisation had “failed to filter out culturally toxic people during the hiring process”.
A number of employees who were suspended following an investigation by the law firm Fox Williams, which was brought in to examine the allegations, have now left the CBI.
Tony Danker was dismissed as CBI’s director general in April. He was the subject of separate complaints of workplace misconduct, unrelated to the sexual assault and rape claims. He has apologised in relation to some of the complaints about him and contested others.
An ethics consultancy, Principia Advisory, was asked to review the CBI’s culture.
According to Wednesday’s prospectus: “Principia do not find that blanket descriptions such as ‘toxic’ or ‘misogynistic’ are accurate or useful descriptions of CBI culture” but that “attitudes towards culture are inconsistent, with a lack of awareness of different experiences and limited self-reflection”.
It also found that many “staff do not feel confident speaking up when they experience or observe misconduct”.
Sources close to the CBI said that while women had been among those worst affected by misconduct, its new processes needed to consider reform regardless of gender and race.
The sources said that it would take time to build trust and confidence for internal reporting processes for any complaints. The CBI plans to keep on external support to handle any concerns staff might have for the time being.
“For the CBI, this has been a painful period and a time of deep reflection. We are determined to learn the lessons needed and emerge from this as a stronger organisation, one that is able to share what we’ve learned with our wider society and regain the right to be a trusted voice.” Newton-Smith said in a statement on Wednesday. She added her organisation was “learning from global experts on ethics, corporate governance and tackling sexual harassment”.
The CBI said it had consulted with more than 1,000 business leaders on the plan and that they had valued its ability to “bring together sectors and multiple parts of government, both local and national, including the major economic regulators”.
On Wednesday, McBride said: “The need to bolster the CBI’s governance structures is something that has come through loud and clear during this period.
“We are making significant and fundamental changes to improve our organisation for the better and for the people working in it. We remain determined to restore the confidence of our members and that of our many stakeholders in the CBI.”
