CBI seeks legal advice over possible insolvency in wake of scandal
Britain’s most prominent business lobby group has sought guidance on possible insolvency as it battles for survival in the wake of sexual misconduct allegations.
The legal advice was requested by the Confederation of British Industry (CBI) before the publication on Wednesday of a prospectus setting out plans to turn around the organisation. Members will be asked to decide on its future in a confidence vote, with the results announced at a crunch meeting on 6 June, which will determine whether the CBI and its new director general, Rain Newton-Smith, have a mandate to continue their work.
The CBI, which describes itself as the “voice of business” in the UK, lost more than 50 members last month, including the retailer John Lewis and NatWest Bank, and its president has admitted hiring “culturally toxic” individuals.
Both the government and the Labour party have suspended any engagement with the lobby group, and the CBI said it would mothball its operations until after the June meeting.
A spokesperson for the CBI said the board had asked for advice about a range of potential restructuring options, including insolvency or being “smaller and refocused in the future”.
The CBI has engaged the law firm Fox Williams to carry out an independent investigation of human resources processes and the handling of complaints, but it went to a separate firm for the insolvency and restructuring advice, the Guardian understands. The request for advice was first reported by Sky News.
A flood of members left after articles by the Guardian reported allegations of sexual harassment and sexual assault, including rape, spanning several years.
The exodus has created uncertainty and anxiety for the group’s staff of about 300 people, who fear losing their
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