Friday, June 14, 2024

CBI axes more jobs amid battle to win back corporate members

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The business lobbying group is cutting another 7% of its workforce as it continues its recovery from last year’s sexual misconduct scandal, Sky News learns.

By Mark Kleinman, City editor @MarkKleinmanSky

The CBI is taking the axe to another chunk of its workforce as it struggles to recover from the sexual misconduct scandal which last year led it to the brink of collapse.

Sky News has learnt that the business lobbying group has begun a consultation process with 7% of its remaining staff about making their roles redundant.

Sources said the move, which is being overseen by chief executive Rain Newton-Smith, was expected to trim the CBI‘s headcount of roughly 150 people by 11.

It was unclear on Tuesday which roles would be affected.

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Although modest in scale, the renewed redundancy programme underlines the CBI’s struggle to regain its financial bearings just over a year after it was plunged into turmoil.

In a statement issued in response to an enquiry from Sky News, a spokeswoman said: “We are making a small reduction to our headcount as part of efforts to manage our cost base to ensure we are in the best shape possible to deliver our strategic and financial objectives.

“This is never an easy decision for an organisation to take.

“Businesses are returning to the CBI as well as new members joining for the first time.”

The CBI has not published a list of new or returning members, although a number of blue-chip backers which suspended their memberships during the scandal last year are understood to have resumed their engagement with it.

CBI chief executive Rain Newton-Smith. Pic: CBI

“We are confidently back doing what we do best – serving as the catalyst between industry and government to drive the sustainable growth across the economy,” the CBI said.

“With a defining general election around the corner, we are focused on providing that collective voice for businesses of all sizes and sectors across the UK.”

Earlier this year, Sky News revealed that the CBI had negotiated an extension of its overdraft in a fresh move to shore up its balance sheet.

At the time, people close to the talks said it reflected a slower-than-expected return of corporate members to the group, even as it has started to rebuild its credibility under new chairman Sir Rupert Soames.

The CBI teetered on the brink of collapse for much of last year after a sexual misconduct scandal forced out its director-general and triggered an exodus of prominent members.

According to the business lobby group’s most recent annual report and accounts, it was able to survive the aftermath of a sexual misconduct scandal “through the backing of key members, the use of reserves, support from creditors and with bank financing”.

“The bank financing is due to terminate on 30 September 2024, after which it is the board’s current intention to look to renew the facility if required.”

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Self-styled as “the voice of British business”, the CBI has gradually regaining its voice in Westminster, holding private talks with politicians from both main parties.

It recently hosted a public dinner at which Sir Rupert interviewed Kemi Badenoch, the business secretary, on stage.

The CBI has slashed costs by axing a chunk of its workforce and closing most of its overseas offices.

It briefly entertained talks last autumn about a merger with Make UK, the manufacturers’ body, but these were abandoned.

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