The Confederation of British Industry (CBI) has announced plans to reduce its workforce as it continues to recover from a sexual misconduct scandal that nearly caused its collapse last year. According to sources, the business lobbying group has begun a consultation process with 7% of its remaining staff, with the intention of making their roles redundant. The move, overseen by chief executive Rain Newton-Smith, is expected to result in an 11% reduction of the CBI’s headcount of approximately 150 employees. The specific roles that will be affected by this decision were not disclosed at this time.
In the midst of ongoing efforts to stabilize its financial situation, the CBI released a statement in response to inquiries from various sources, including Sky News. A spokesperson for the organization stated, “We are making a small reduction to our headcount as part of our efforts to manage our cost base and ensure that we are in the best position to achieve our strategic and financial objectives. We recognize that this is a difficult decision for any organization to make. However, we are pleased to see a growing number of businesses returning to the CBI, as well as new members joining for the first time.”
While the CBI has not publicly released a list of its new or returning members, it is understood that several prominent companies, which suspended their memberships during the scandal last year, have resumed their involvement with the organization. The spokesperson continued, “We are confident in our ability to continue serving as a catalyst between industry and government to drive sustainable growth across the economy. As we approach a pivotal general election, we remain focused on providing a collective voice for businesses of all sizes and sectors throughout the UK.”
Earlier this year, it was reported by Sky News that the CBI had secured an extension of its overdraft in an effort to strengthen its financial position. According to sources familiar with the negotiations, this move was necessary due to a slower-than-expected return of corporate members to the organization, despite efforts to rebuild its credibility under the leadership of new chairman Sir Rupert Soames.
Last year, the CBI faced imminent collapse as a result of a sexual misconduct scandal that led to the resignation of its director-general and the departure of many prominent members. However, thanks to the support of key members, the use of reserves, and assistance from creditors and bank financing, the organization was able to weather the storm. According to its most recent annual report and accounts, the bank financing is set to expire on September 30, 2024, after which the board plans to seek renewal of the facility if necessary.
As “the voice of British business,” the CBI has gradually regained its influence in the political sphere, engaging in private talks with representatives from both main parties. In a recent public event, Sir Rupert interviewed the business secretary, Kemi Badenoch, on stage. In addition to cutting costs by reducing its workforce and closing most of its overseas offices, the CBI explored the possibility of a merger with Make UK, the manufacturers’ body, but ultimately decided against it.
