A number of major UK corporations including NatWest, John Lewis, Virgin Media O2 and insurers Phoenix, Zurich and Aviva quit the Confederation of British Industry (CBI) on Friday as a fresh media report about rape allegations deepened the crisis at the business group.
The CBI is now facing a fight for survival as the number of companies cutting ties with it grows.
Late on Friday the CBI board said it had taken “the difficult but necessary decision to suspend all policy and membership activity until an Extraordinary General Meeting (EGM) in June.”
Other major companies including Schroders, Fidelity International, Jaguar Land Rover, WPP, ITV, Sage and Kingfisher also said they had quit the CBI.
The CBI said an urgent root-and-branch review of its culture was proceeding and it would respond to the investigation by law firm Fox Williams early next week and set out its plans for change.
Some CBI members have said they will wait for the findings of the law firm’s investigation, which is expected imminently.
“While the CBI was not previously aware of the most serious allegations, it is vital that they are thoroughly investigated now and we are liaising closely with the police,” CBI President Brian McBride said.
McBride is a non-executive director of Edinburgh investment giant Abrdn, which said at the end of February that he would not be seeking re-election at its AGM on May 10.
Abrdn said: “Like other members, we await the outcome of the current review, and look forward to understanding the CBI’s plans for dealing with the issues that have emerged.”
NatWest, formerly called RBS, said: “British business needs a strong representative voice. Given the extremely serious allegations made against the CBI, we no longer have confidence that it can fulfil this role at the present time.”
John Lewis said in a statement: “Due to the further very serious and ongoing allegations made relating to the CBI, we have decided to end our membership with immediate effect.”
Virgin Media O2 said: “The way the situation has been handled is not representative of business in Britain. We have therefore informed the CBI that we are ending our membership.”
Aviva said: “In light of the very serious allegations made, and the CBI’s handling of the process and response, we believe the CBI is no longer able to fulfil its core function — to be a representative voice of business in the UK.”
CBI President Brian McBride’s full statement read: “The latest allegations put to us by The Guardian are abhorrent and our hearts go out to any women who have been victims of the behaviour described.
“While the CBI was not previously aware of the most serious allegations, it is vital that they are thoroughly investigated now and we are liaising closely with the police to help ensure any perpetrators are brought to justice.
“We recognise the substance of the harassment report outlined as relating to an allegation made and investigated in January 2018. The finding of harassment was upheld and a sanction was imposed.
”However, the CBI does not recognise many of the most serious elements of the Guardian story relating to harassment, including the assertion that the individual had told the CBI of feelings of a sexual and violent nature towards the victim; and that he had followed her home.
”Neither is the CBI aware and our records do not support the report that the CBI discouraged her from referring the matter to the police.
“We are rightly undertaking an urgent root and branch review of our culture to right the wrongs where we can and to reform our workplace for everyone.
“We are anticipating a further report from Fox Williams later today. The board will communicate its response to this and the other steps we are taking to bring about the wider change that is needed early next week.”
Late on Friday the CBI board said in a statement: “The CBI shares the shock and revulsion at the events that have taken place in our organisation, and at past failures that allowed these events to happen.
“We are deeply sorry and express our profound regret to the women who have endured these horrific experiences.
“We have listened carefully to what our colleagues, members and stakeholders have said over recent days and weeks. We have heard loud and clear a demand for far reaching change.
“We want to properly understand from our colleagues, members, experts and stakeholders how they envisage our future role and purpose.
“As a result, we have taken the difficult but necessary decision to suspend all policy and membership activity until an Extraordinary General Meeting (EGM) in June.
“At the EGM we will put forward proposals for a refocused CBI to our membership for them to decide on the future role and purpose of the organisation.
“This work and the cultural reform will be the entire and urgent focus of the organisation over the coming weeks.
“Our members have told us in recent days and weeks that they believe in the importance of a collective voice to inform national policy and the unique role that an organisation like the CBI can play in public life.
“But much needs to change if we are to win back their trust so we may continue to represent business at this critical time for the country.
“We are taking steps to address our failings but recognise these are not yet sufficient to sustain the confidence of our colleagues, members and of the broader business community.
“We know it will take time to rebuild trust in our purpose and culture. And to give our team and former colleagues the space to heal.”