Scandal-hit business group will survive, new boss says

Scandal-hit business group will survive, new boss says

  • by Simon Jack
  • Business editor

The new CBI chief has said there is a “threat” he can survive after allegations of harassment and sexual assault hit the business group last year.

Dozens of members, including John Lewis and BMW, left the group after the allegations.

The group settled a lawsuit filed by its former boss, Tony Danker, over wrongful termination on Monday.

Rupert Soames told the BBC that the CBI still had an important role to play.

In his first published interview, Mr Soames admitted his concerns about whether the 60-year-old lobby group could survive the “reputational disaster” that has left dozens of its high-profile members.

Companies including John Lewis, Tesco, Aviva and Jaguar Land Rover have pulled out after a series of scandals over sexual harassment, rape and drug-taking allegations rocked the organization which seeks to promote best practice in business.

On Monday, the CBI said it had solved the case of wrongful dismissal of its former director general, Mr. Danker.

Mr. Danker was immediately fired in 2023 after complaints about his conduct, despite the lobbying group making clear that Mr. Danker was entirely unrelated to the most serious allegations.

In his first published interview, Mr Soames – former chief executive of Serco and current chairman of Smith and Nephew – insisted the CBI still had an important role to play as a defender of business interests.

“I think people have found that life without the CBI leaves something missing,” Mr Soames said.

He claimed that the CBI had been instrumental in securing Treasury tax breaks for businesses investing heavily in the UK, as well as helping to push the government to offer extra free childcare in England in the Autumn Statement.

He added that 80% of the 270 members who resigned or terminated their membership said they would consider joining again.

But not everyone agrees. One former member told the BBC he would not be rejoining, saying: “He’s been virtually absent from UK civic life for a year and what have we missed? Nothing.”

The departure of some of its deepest-pocketed members plunged the group into a financial crisis that saw it lay off a third of its 300 staff, close overseas offices and arrange emergency financing last year.

Mr Soames admitted there was still some doubt about the group’s survival as it had to refinance bank debt this autumn.

“We are actually an SME.

“We were grateful that a number of banks agreed to finance us, but like many other businesses, we are here with the consent of our lenders.

“There is danger in everything you do in life.

“We should cut our clothes according to our ability.”

The Voice of Business has had an uneasy relationship with the Conservative government over the past decade. Former Prime Minister Boris Johnson famously used expletives when asked about business concerns during the Brexit negotiations.

Last April, in the depths of the CBI crisis, Chancellor Jeremy Hunt said there was “no point talking to the CBI if its members are not talking to it”.

Relations have since thawed, with the chancellor attending a subdued CBI conference last November.

However, Mr Soames believes both sides now understand the importance of the CBI.

“We are noticing a position that has probably not been true since Tony Blair first came forward, where both the Conservatives and the Labor Party clearly recognize the importance of business to sustain growth,” Mr Soames said.

There are countless other business groups, many of which are more specialized for the needs of their members – SMMT for cars, Hospitality UK, UK Finance, Make UK for manufacturers.

But Mr Soames insisted that without the CBI, it would still need to be invented.

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