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CBI head Rain Newton-Smith said the result was an “important milestone”
The CBI has won a key confidence vote over its future after members overwhelmingly backed the lobby group following a series of scandals.
The CBI said that 93% of the 371 members who voted backed its plans to reform the organisation.
It is not clear how much of the CBI’s entire membership this represents.
It says on its website that it has 700 member organisations but following misconduct allegations, firms and associations have left the group.
Meanwhile some companies like BT, who suspended their membership of the CBI but were eligible to vote, told the BBC they would not take part in Tuesday’s ballot.
The CBI refused to say how many members it has “due to commercial reasons”.
Rain Newton-Smith said the 371 who voted was a “huge proportion of our membership” and that the result is “a really strong mandate from our members”.
But the BBC’s business editor, Simon Jack, said it was unclear how ringing a mandate this was.
The CBI by its own admission says it will be a smaller organisation. It is too soon to say they’re in the clear. This is the beginning of their mission to establish trust.
One of the CBI’s core functions is to speak with the government on behalf of businesses.
‘A tortuous slog’
The government paused any activity with the CBI following allegations of sexual misconduct at the group which were revealed in the Guardian newspaper.
Asked whether it would now re-engage with the CBI following the vote, a spokesperson for the Department of Business and Trade said: “While this is a matter for the CBI and their internal processes, we will continue to engage with businesses on a case-by-case basis and business groups where appropriate.”
Danni Hewson, head of financial analysis at AJ Bell, said the business lobby group still faced “a long and tortuous slog back from the brink”, adding it would take time to rebuild confidence.
“It’s bought a little of that time today but if it can’t win over the government, if it can’t find its way back into the room, then it has no real value.”
While the CBI claims to represent 190,000 firms, not all of these are direct members – the number of which is thought to be substantially smaller.
The lobby group works with trade associations which represent thousands of firms, such as the National Farmers’ Union which has 50,000 members.
At Tuesday’s vote, each member had one vote each regardless of size. That means that a trade association that might represent thousands of companies had one vote.
‘Membership remains suspended’
Although the CBI has won the backing of its remaining members, a recent exodus of fee-paying companies is already affecting the organisation.
And some – like Rolls-Royce – said its membership of the CBI remained suspended.
A spokesperson said: “We will monitor the implementation of the reforms detailed in the prospectus. In the meantime, our membership remains suspended.”
The CBI recently said it would have to make job cuts in order to slash its wage bill by a third. In its most recent public accounts, for 2021, the CBI reported income of £25m, of which £22m came from membership fees.
That is expected to fall for the current financial year following the number of companies who have quit the lobby group or let their memberships lapse.
Ms Newton-Smith told the BBC: “We know we’re going to come out of this a smaller organisation but [the vote] also gives us a really clear mandate to get out there and get new members to join our organisation. I want to work on all those members who maybe have left.
“We are proud of that conversation [that] now we have got a strong mandate from existing members and we’re going to come out and focus on the really important issues of the day.”
The CBI employs about 250 people in the UK and has offices overseas.
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