Separating Diversity Campaign from Confederation of British Industry

Some of the UK’s biggest companies are seeking to separate a major diversity campaign in the CBI’s boardrooms after cutting ties with the business in crisis lobby group.

FTSE 100 groups Aviva, Schroders and Sage as well as Big Four consultancies Deloitte and EY are among the companies that have been involved in the talks, according to people familiar with the talks and a list seen by the Financial Times.

Ensuring Independence for Change the Race Ratio

Ensuring the independence of the Change the Race Ratio campaign would allow companies that have cut ties with the CBI to remain involved in the diversity initiative.

The spin-off, which could be officially announced as early as next month, would insulate the campaign from the financial and reputational crises engulfing the CBI.

The lobby group is fighting for its survival after a wave of corporate members quit or cut off their engagement with it over a governance and misconduct scandal in April, including two rape allegations that sparked an investigation of the font.

The CBI has since changed direction and embarked on an overhaul of its culture and governance, and is trying to convince companies to renew their membership.

Change the Race Ratio Campaign

The Change Race Ratio value was launched in 2020. It calls on companies to set and publish clear goals for greater racial and ethnic diversity at board, executive, and senior management levels. Its 111 signatories employ a total of nearly 600,000 people.

Following furor over allegations of misconduct, a group of companies that founded the initiative decided they “don’t want it to die” because of the broader issues at the CBI, the agency said. one of the people familiar with the talks.

Concerns have also been raised about the credibility of the CBI to lead the campaign, given the high-profile allegations. “The one thing the CBI has no authority over is diversity,” the person said.

Creating a Standalone Entity

Spinoff talks discussed how to convert the campaign into a nonprofit and potential funding models for the standalone entity, people with knowledge of the matter said.

“Everyone wants this to continue,” said another person briefed on the talks. “They don’t want to slow him down or put him on the ice while other things are going on. It’s such an important topic that it needs to maintain its momentum.

Key Players and Leadership Changes

The Investment Association, public relations firm Brunswick, and headhunter Russell Reynolds are among other organizations involved in the talks.

Under the plan, Lord Karan Bilimoria, who set up the initiative during his time as CBI chairman, would be replaced as chairman of the project by Sir Trevor Phillips, a broadcaster and former head of the equalities watchdog UK.

Bilimoria told the Financial Times he was asked to become the first chairman of Change the Race Ratio, alongside Phillips as chairman.

The Cobra beer founder is deputy chairman of the CBI but will step down after the lobby group’s annual meeting in September. He said he believes the CBI will “continue to be a founding member” of the diversity campaign.

Finalizing the Details

Which companies would ultimately be involved and whether the CBI would retain a formal relationship with the campaign has yet to be finalized, said two people with knowledge of the plans. A very small number of CBI employees and assets could transfer to the new entity, they said.

The CBI said it was “proud to have played a key role in founding Change the Race Ratio” and that “in accordance with an agreed long-term plan, the campaign will now be established as an independent entity”.

Continuing the Drive for Diversity

He said that “increasing the representation of ethnic minorities on UK boards and in management is absolutely crucial” and that he would continue to work “to empower organizations… aim higher and go further in creating truly inclusive workplaces”.

Changes in the CBI

The organization is embarking on a layoff program and announced on Friday that it would close its small offices in Beijing, Delhi, and Washington. Brussels is its only overseas outpost that will continue to operate.

Additional reporting by Ian Smith in London

Summary:

Some of the UK’s biggest companies are seeking to separate the Change the Race Ratio campaign from the Confederation of British Industry (CBI) due to the CBI’s ongoing financial and reputational crises. The recent governance and misconduct scandal, coupled with rape allegations, have led to corporate members cutting ties with the CBI. In response, talks are underway to establish the campaign as an independent entity to ensure its continuity and insulate it from the issues plaguing the CBI. The Change the Race Ratio campaign, launched in 2020, aims to promote greater racial and ethnic diversity at board, executive, and senior management levels. The initiative’s founders are committed to its continuation despite concerns about the CBI’s credibility in leading the campaign. Lord Karan Bilimoria, who initiated the campaign, will be replaced by Sir Trevor Phillips as chairman. The exact involvement of companies and the nature of the relationship between the CBI and the campaign are yet to be finalized. The CBI emphasizes the importance of increasing ethnic minority representation and pledges to support future efforts in creating inclusive workplaces. Meanwhile, the CBI itself is undergoing restructuring and will close some international offices.

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