The former chief executive of the Liberal Democrats has been cleared of sexually harassing party members despite an internal review concluding there was "credible" evidence that he had "violated the personal space" of many female colleagues.
An investigation by QC Alistair Webster found there was a "less than 50% chance" that a charge against Lord Rennard could be proved to the required standard.
However in a statement released on Wednesday, Webster stressed that this did not mean he found the evidence provided to his inquiry unreliable.
"It is my view that Lord Rennard ought to reflect upon the effect that his behaviour has had and the distress which it caused and that an apology would be appropriate, as would a commitment to change his behaviour in future," he said.
Following the decision, and despite criticism from many party members, Rennard said he intended to resume his job at the top of the party.
"I now look forward to resuming my roles within the Liberal Democrats. I remain committed to the same values which made me join the Liberal Party as a teenager more than 40 years ago," he said.
However Nick Clegg said: "People in positions of authority should never subject anyone to behaviour which is offensive or inappropriate. It is as simple as that.
"I want everyone to be treated with respect in the Liberal Democrats. That is why it is right that Chris Rennard has been asked in the report to apologise, to reflect on his behaviour and why he won't be playing any role in my general election plans for the campaign in 2015."
Alison Smith, a former Lib Dem activist who accused Rennard of sexually inappropriate behaviour, said the party's internal procedures were "fundamentally flawed". Following the ruling she said: "An apology would certainly be a good start, and one from the Liberal Democrats as well."
She added: "In 2014 a major political party finds that it has no suitable procedures for dealing with allegations of serious sexual harassment."
Alison Goldsworthy, another Lib Dem who said she had been harassed by Rennard, expressed outrage at the decision.
"Faced with the opportunity to take strong action, the Liberal Democrats have once more opted for cowardice," she said.
"They have failed to say Lord Rennard's behaviour is unacceptable, they have failed to discipline him and therefore have failed to give victims the justice they deserve."
Party president Tim Farron said the allegations had been taken "extremely seriously" but he had "no choice but to accept Alistair Webster QC’s conclusions".
He added: "Nick Clegg and I are clear that we need to look again at our disciplinary procedures. While this process has not found to a criminal standard of proof that Lord Rennard acted with indecent intent, it is clear that he did not behave in the way that a Chief Executive should behave. Lord Rennard must reflect on his actions and apologise to the women involved."