In defence of keeping the CBI alive and even expanding it
After the sacking of Tony Danker, the CBI is in death throes, but we still need a place to build trust in business leaders, and we should save the principle of the Confederation of Business Industry, writes Ben Cope
The Confederation of British Industry – the CBI – doesn’t have many friends right now. Rocked by a series of sexual misconduct allegations – including several against the recently dismissed director general Tony Danker, many are calling for the trade association to be disbanded.
An existential crisis is warranted for the CBI; yet closing it down would be the wrong move. Business has gained a bad reputation among every stakeholder – from government, to media, to people. To respond, a reimagined, expanded CBI should make championing British business as a force for good its primary objective.
Even before the allegations against Danker and others in recent weeks, the CBI had lost its way. Membership fees are exorbitant, running to tens of thousands of pounds for large organisations. Businesses had long complained they weren’t getting bang for their buck. At the same time, the Confederation has strayed too far into taking public political stances. The CBI was unwisely vocal in its opposition to Brexit, given its main stakeholder – the government – won an election committing to deliver it.
It’s therefore no surprise that as the allegations flooded in, and calls for the CBI to be disbanded mounted, few jumped to the Confederation’s defence. Members have been asking “what has the CBI ever done for us?” but have struggled to find answers.
This led many to declare the CBI unfit for purpose. How can a single trade association represent over 190,000 members, as the CBI claims to? This scope is particularly unreasonable given that most members come through affiliated trade bodies – not direct relationships – and with the vast majority of its £22m annual subscription revenue coming from major PLCs such as Rolls Royce and Marks & Spencer – not small businesses.
But abandoning the CBI as a vehicle for change doesn’t fix businesses problems. As much as public relations professionals point to the Edelman Trust Barometer which shows the public trust business leaders more than politicians, the bar of comparison is low. From the financial crisis to bankers’ bonuses, skyrocketing CEO pay to stagnating real wages, and greenwashing, the public has lost faith in business as a creator of jobs, wealth and innovation.
The media and government have followed the public’s lead. Profit is now seen as synonymous with profiteering in the media’s coverage of annual results, while even the Conservatives – supposedly the party of business – have joined the “f*** business” bandwagon.
This reputational crisis represents a commercial challenge for business. Public opinion polls show that voters support the renationalisation of rail, water and energy, as people increasingly look to government to provide stability. Similarly, business risks losing out on the coming green economy, as voters place trust in government to manage the transition – rather than business – believing the profit motive is a key driver of climate change.
Challenging this new orthodoxy should be the primary objective of a reimagined, expanded CBI. Its current remit as a lobbying trade association is tactical, flawed and outdated. Who cares about reducing corporation tax if the economy is nationalised? Instead, the CBI should reconceive itself as a strategic champion of business as a force for good.
After all, there are brilliant examples of businesses driving Britain forward – innovating, greening the economy, improving lives. Profit can be a crucial incentive for progress. The CBI shouldn’t just claim business has a social value, it should work to ensure it does.
This mission is so big – so central – that no single business or sector specific trade association could make it alone. This is the role of an overarching body representing British business. This is the role of the CBI.