For much of the business world, the turmoil is a sideshow: tabloid fodder rather than an event with the potential to upset the corporate policy landscape. The CBI’s influence has been in decline for decades. Its campaigning against Brexit annoyed many in the ruling Conservative Party and prompted the use of an expletive by former Prime Minister Boris Johnson in 2018. Now that the group is in need, it has few friends to turn to. British media coverage of the controversy has focused on whether this will be the coup de grace that finishes off an obsolete institution. The words “existential crisis” have been frequently deployed. 

It’s a poor look when an umbrella group for 190,000 businesses that is responsible for helping to set standards of ethics is itself seen to be violating them. The CBI has strongly supported recent government efforts to tackle sexual harassment in the workplace; one recommendation-laden submission on its website runs to 2,500 words.

The termination of Tony Danker, the director general, followed an independent investigation into complaints of workplace misconduct. (Danker, while acknowledging he had made colleagues uncomfortable, said many of the allegations against him had been distorted and he was shocked to be dismissed without a chance to put his position forward.) A second phase of the inquiry will examine allegations of sexual misconduct from more than a dozen women that the Guardian reported on this month, none of which relate to Danker. The most serious concerns a woman who claims she was raped by a senior colleague at a summer boat party in 2019. She told the newspaper she was advised by a CBI manager to seek counselling rather than pursue the matter.

The images suggested by the reports, of testosterone-fueled white-collar managers plying female colleagues with alcohol on booze cruises, are like something from another era: reminiscent of a scene from Mad Men or The Apartment. That’s probably no accident. The CBI itself is something of a relic. Formed in 1965 by a merger of older employer bodies, its heyday was in the 1960s and ‘70s, when industrial policy was a tripartite carve-up between the government, the bosses’ lobby and the Trades Union Congress. Besides political blunders, its influence waned as the economy changed, manufacturing declined and multinationals increasingly undertook their own lobbying efforts.

Pre-1980 society was notably more male-driven, alcohol-soaked and permissive of sexual exploitation. At the time, this culture was often presented as harmless fun, exemplified by the smutty comedies of the Carry On films (later used by the Equal Opportunities Commission to raise awareness about sexual harassment). Britain, like much of the world in the wake of the MeToo movement’s rise, has been undergoing a reappraisal of its past, after a series of well-known television personalities from that period were found to have been sexual abusers. 

A question for the UK is whether the CBI is just an antediluvian holdover or a reflection of more widely held attitudes. For the government, keen to attract investment in the post-Brexit era, the case makes an unfortunate advertisement for the inability of UK business culture to evolve in tandem with changes in societal norms.

The speed with which several companies distanced themselves from the group shows that some employers at least are alert to the reputational risks. Still, it would be rash to conclude that the episode is an aberration. Surveys show that at least 40% of women have experienced workplace harassment, according to the Fawcett Society. The group, which campaigns for gender equality, says Britain has a pervasive culture of workplace sexual harassment, with behavior that violates the dignity of women often treated as acceptable “banter.”

“We know that this is a common story,” said the society’s chief executive officer, Jemima Olchawski, who called the alleged CBI incidents “horrifying.” In 2021, the government committed to legislating a duty for employers to prevent sexual harassment. As the CBI scandal broke, a worker-protection bill was still inching its way through parliament, where it is at risk of running out of time because of stalling tactics by opponents.

Meanwhile, the CBI is stretching belatedly to repair the damage. In a statement last week, it said the allegations were “devastating,” acknowledged “serious failings,” and apologized to the victims. It named former CBI Chief Economist Rain Newton-Smith as the group’s second female director general to replace Danker, promised a root-and-branch review of the organization’s culture, governance and processes, and appointed a chief people officer.

It remains to be seen whether that will be enough. With an organizational psyche that appears still partly stuck in the 1970s, few will be surprised if the group proves insufficiently nimble to recover its relevance.

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This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Matthew Brooker is a Bloomberg Opinion columnist covering business and infrastructure out of London. A former editor and bureau chief for Bloomberg News and deputy business editor for the South China Morning Post, he is a CFA charterholder.

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