CBI drafts in lawyers for potential insolvency filing - report
By Michele Maatouk
Date: Tuesday 30 May 2023
(Sharecast News) - The board of the scandal-hit Confederation of British Industry has reportedly drafted in lawyers to prepare for a prospective insolvency filing ahead of a crunch vote by thousands of its members next week.
According to Sky News, the business lobby group has hired an unnamed City law firm to provide advice on directors' duties under company law.
City sources told Sky on Tuesday that the legal advice was partly focused on CBI directors' decision-making about continuing to trade the organisation as a going concern. One said that an adverse outcome from a vote at next week's extraordinary general meeting would leave its board with little choice but to begin a process to wind it up.
Such a scenario would be complicated by the Royal Charter by which it was incorporated in 1965, they added.
The legal advice on directors' duties is not being provided by either Fox Williams, which oversaw a probe into allegations of sexual misconduct, or the CBI's usual law firm, Clarkslegal.
"It is about making sure the board is complying with its obligations at an uncertain time," a source said.
Next week's ballot will take place on a 'one member, one vote' basis, with the CBI requiring a majority of votes cast in favour of a resolution the CBI's ability to deliver a new mandate.
The CBI has already been hit financially by the cancellation of membership subscriptions by dozens of blue-chip members after the Guardian revealed a series of allegations of sexual misconduct.
Email this article to a friend
or share it with one of these popular networks:
You are here: news
10 Lower Thames St,
London EC3R 6EN