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Scandal-hit CBI hires ethical investing critic Rupert Soames

Rupert Soames
Mr Soames has clashed with ethical investors over claims they are making it harder to defend and police Britain - Jonathan Hordle/Shutterstock

The Confederation of British Industry (CBI), once Britain’s biggest lobbying group, has hired a staunch critic of ethical investing as its next president as it battles to win back support in the City.

Rupert Soames, the grandson of Sir Winston Churchill, will take over from Brian McBride, who previously suggested that the organisation could be beyond saving after it was hit by claims of sexual misconduct.

The former Serco chief executive is a bold choice for the business lobbying group as he has been an outspoken critic of environmental, social, and governance (ESG) policies.

Mr Soames, whose brother is the Tory grandee Lord Soames, has clashed with ethical investors over claims they are making it harder to defend and police Britain.

During his nine years as Serco chief executive, Mr Soames said ethical investors had stopped companies from working on national security contracts before later rowing back on their criticism after Russia’s invasion of Ukraine.

He said: “You’ve never heard or seen such a rapid, screeching U-turn because you’ve hit reality, which is that defence is a worthy thing for countries to do and they need the support of private companies to be able to do that.”

Mr Soames also took aim at funds that had shunned investment in defence stocks “because they did nasty things and made nasty weapons”.

He will be officially appointed in June following a formal election by members.

Mr Soames’ appointment comes as the CBI battles to rebuild its reputation following a sexual misconduct scandal which triggered the exodus of dozens of its largest members.

An independent review by law firm Fox Williams found that the business group had failed to sack “toxic” sexual predators and lost the confidence of female staff members.

Mr Soames said: “After a decade of disruption and distraction due to Brexit, Covid, inflation and labour shortages, business and government need to work closely together to deliver a prosperous future where economic growth will lift living standards and sustainably fund the UK’s vital public services.

“The CBI is needed more now than at almost any time in its history, and it will be a privilege to lead the organisation in the coming years.”

CBI chief executive Rain Newton-Smith said: “Rupert is a fantastic advocate for UK business, and I am delighted to enter the new year working alongside someone with his depth and breadth of experience to ensure the CBI delivers a strong voice for our members, trade associations and for the UK business community.

“As we head into 2024, leadership from business is vital in delivering sustainable growth and a positive vision for the UK economy, and I look forward to delivering that together.”

Mr Soames started his career at General Electric decades ago, but became best known in the business world for running FTSE 250 outsourcer Serco and Aggreko, a power company formerly on the FTSE 100.

The CBI has previously called for companies pouring cash into solar panels and eco-friendly heat pumps to avoid rises in business rates.

When chief executive Rain Newton-Smith was the organisation’s chief economist, she said businesses practising ESG should instead get exemptions from bills to encourage green investment.

Ms Newton Smith is also a former managing director of ESG for Barclays.

The CBI has hosted numerous guides to launching ESG strategies on its website. Its lead campaign online sets out its goals to deliver “sustainable growth for the benefit of society”.