It was the Confederation of British Industry’s moment to convince parliament that it was now time to re-engage. Interactions with ministers and civil servants have been on hold since the beginning of April, after the Guardian revealed more than a dozen women had come forward with allegations of sexual misconduct, including rape.
The setting for a rapprochement was a hearing of the business and trade select committee. These encounters can often be used as a pressure valve for public outrage, with errant company bosses hauled over the coals – the BHS boss Sir Philip Green famously told an MP to stop staring at him during a heated exchange in 2016. But Tuesday’s event was more of a polite question-and-answer session than a grilling. If not exactly warm, the welcome was at least cordial.
The CBI’s director general, Rain Newton-Smith, who was appointed in April to steady the ship, chose to appear alongside two other female members of her team. Andy McDonald MP noted approvingly: “We’ve got three women representing and I think that’s a really important message.”
Did the trio do enough to swing the pendulum? It’s a bit early to tell. Rehabilitation will be a slow process, and it will take many interactions for trust to be regained. There is, after all, a police investigation ongoing into some of the allegations.
But the conclusion from Tuesday’s hearing is that, despite the director general’s calm and composed performance, the CBI is still in crisis and reluctant to reveal just how much an exodus of members has dented its ability to speak for a broad cross-section of business.
Questioned about the number of companies that had left, Newton-Smith declined to say. The Guardian puts the tally at more than 50 businesses and trade groups that have quit or suspended their membership.
The director general would not answer questions about what gaps the CBI had been left with. But we know from statements by the companies themselves that a chunk of the UK’s powerful insurance sector, and all of the big four accounting firms, have terminated or paused their membership.
Mark Pawsey MP pressed the point: “How can we, and others, see you as the authoritative voice of British business if … you’re not even able to tell us who your members are?” Newton-Smith said she was “reflecting” on how to be more transparent, for example by publishing a list of members. For now, the MPs must rely on what the members have disclosed.
Aviva, NatWest, John Lewis and BMW publicly quit a few weeks ago, and Tesco, BP and National Grid followed them out of the door this month – after Newton-Smith had published her plans to reform the CBI’s culture and governance. Some leavers are understood to have felt the changes were too incremental. A new name for the lobbying group was mooted but never materialised, and instead of a board clearout the talk is now of a board refresh.
The CBI says it still speaks for businesses that employ 2.5 million people, but Newton-Smith would not say by how much that number had fallen in recent weeks. She finally confirmed the lobby group still had more than 1,200 direct members – more or less the same number as before the crisis.
Combined with around 150 trade bodies that are also members, that means two-thirds did not cast a vote at all when the CBI polled members to support its plan for change (there were 371 votes, with a further 23 withheld or abstained). That fact leaves serious questions about the CBI’s mandate.
Although it still publishes comprehensive surveys – its latest economic forecast appeared on Monday – many other activities remain paused. Newton-Smith was not able to confirm when or if the CBI would hold its annual conference this year. The events page on its website is still empty, with a holding message stating: “The CBI programme of events is currently under temporary review. Thank you for your patience during this time.”
Newton-Smith has her supporters, with Siemens and Microsoft publicly backing the CBI in recent days. Large trade bodies such as the National Farmers’ Union, the British Retail Consortium and UK Finance have remained onboard as members. So far, however, none of the companies that left have publicly indicated they are ready to come back. Those that paused their support have also been silent.
With membership fees of more than £100,000 a year for the largest organisations, they are unlikely to return unless government – and the Labour party – decide to bring the CBI back in from the cold. The hearing offered no clues as to when that may happen.
