HIST363: Global Perspectives on Industrialization

What did this distinctively corporate sociology for global interaction consist of? We highlight five qualities: First, corporations were subordinate to state authority at home and abroad.⁷³ This allowed them to establish durable trading relationships overseas. Second, corporations were – in effect – processes of negotiation with external constituencies: foreign merchants, interlopers, European rivals, and foreign states. In their global operations, they were not monopolies. They were subject to intense competition wherever they operated. Nor were they exclusive entities. Their membership was porous and responsive to outside influence and their interactions with internal and external constituencies was deliberative. Third, corporations were constitutions that facilitated the effective structuring of these international relationships (which were themselves constitutional in character). Fourth, in their global operations, corporations were autonomous from the oversight of their domicile state. This allowed them to act with the juridical agility to develop styles of governance overseas that were unthinkable at home. This autonomy allowed corporations to be jurisdictionally evasive. They occupied the jurisdictional free-space between nation states and assumed their own corporate identities and aspired to sovereignty. This meant that they could shed their national skin. Fifth, corporations were integrative; they connected global realities with local, regional, and national interests, debates, and posturing.

i Corporations as Subordinate

Such corporations, of course, were not the only European means for governing overseas trade and cross-cultural interaction. The English, to take one national tradition, used multiple constitutional forms to interact with non-European contexts. These included proprietary grants (based on feudal principles), which conferred considerable autonomy on proprietors. The English state used proprietaries in much of colonial North America, in Maryland, New York, New Jersey, and the Carolinas. However, there were important structural differences between proprietary colonies and corporations. Corporations mixed governmental and commercial agendas and set the two into creative tension. They raised money from (hundreds and sometimes thousands of) investors and would need to uphold the interests of those investors to endure. This capital (as well as the company's ability to borrow large sums of money) provided them with the resources to cultivate state support. The state renegotiated the corporations' privileges on several occasions. Proprietary colonies participated in trade, but they were primarily conceived as land holdings and mechanisms for settlement. The personal property of a few absentees, they had to satisfy far more narrow concerns. The proprietary colonies were often the result of state payments (to settle debts – as with those to William Penn's family) and did not lend money to the Crown. Their charters were less frequently re-negotiated. The state took sporadic interest in these ventures and so they became largely personal fiefdoms. William Courteen's proprietorship of Barbados, which was granted to him in 1627, had to contend with a rival claim from the Earl of Carlisle. Despite initially colonising the island, Courteen effectively lost control following a military coup by rival agents in 1629, with the loss of some £10,000 worth of investment.⁷⁴ Following his violent ejection from the Caribbean, Courteen and his sons adopted a joint-stock corporate model for their subsequent venture into Asia, launching the Courteen Association in 1635 with support from the Crown. Much like Thomas Pitt later, the East India Company ultimately merged the Courteen stock and its personnel into their own operations in 1657.⁷⁵

The English and other European states also resorted to direct state intercession – such as the Portueguese state's Estado da India to manage overseas interests. Direct state rule was expensive and inhibited the infusion of non-European interests into the commercial relationships that trading corporations established. Furthermore, states could not subordinate themselves to foreign states – a problem that corporations – as subordinate entities – did not have. The comparison between the two territories in Catherine of Braganza's dowry to the English King Charles ii confirms this. In 1661, the dowry brought the North African port town of Tangier and the islands of Bombay into English control. Both were ruled by the English Crown initially, but the Crown transferred Bombay to the East India Company in 1664.⁷⁶ In Tangier, the Crown officers struggled to provide the necessary fealty to the expanding Moroccan empire of Moulay Ismael.⁷⁷ The East India Company, however, could readily subordinate itself to foreign states in India. The same was true of the Royal African Company in Cape Coast. The Corporations were uniquely predisposed to subordinating themselves to foreign states.⁷⁸ Similarly, states could not justify their control over foreign territories with reference to their subordination to the local rulers of those territories. Corporate entities often justified their existence and explained their power with reference to the trading privileges they had established overseas – effectively arguing that they owed more to their international relationships than their domestic ones.⁷⁹ Merchants could also interact with non-European environments as free agents. While this was widespread in practice, most global interactions took place under the formal umbrella of state governance in one form or another and interloping merchants often relied upon the infrastructure of corporations – such as forts or remittance structures – to prosper. The interloper Thomas Bowrey travelled to Asia on an East Indiaman in 1668, was employed by the Chief of Masulipatam, had his pepper purchased by Company factors, traded under a Company pass, and enjoyed the rights and protections which came with living at Company settlements. When he was imprisoned by the Indian governor of Porto Novo in 1687, he appealed to the Company's factory there for succor, 'as hee own'd the Right Honble. Companys Protection'.⁸⁰

ii Corporations as Processes of Negotiation

Despite their monopolistic pretensions successful transnational trading corporations learned to operate in ways that favoured those beyond their membership. In this, they followed the tendencies of their municipal forbears. Scholars of municipal corporations have been most sensitive to the corporation's traditional deliberative, participatory culture. Philip Withington, has stressed the internal civic traditions within the corporation and has viewed these traditions as formative of national state political repertoires.⁸¹ Withington regarded the corporation's civic culture as the provider of the 'social depths' of state authority. But historians of early modern Europe have not, on the whole, projected this understanding of the distinctively inclusive sociology of the corporation onto the global field of view of the trading corporation. Scholars have instead focussed excessively on the internal governance of corporations – and especially the 'agency problem' of managing overseas officials in ways that benefitted the corporate whole. These scholars have continued to fixate on the trading corporation's exclusive, monopolistic veneer.⁸²

Corporations as global actors ought therefore to be understood primarily in terms of their changing relationships with internal and external interests. Early modern corporations were not static institutions but processes of negotiation between various interests: with the states at home and abroad who extended commercial privileges to them; with their workforces, with lobbyists, interlopers, and the non-European suppliers and brokers who facilitated their trade. Corporations boasted deliberative governance rules that allowed owners to influence their activities. But corporations were much more than the narrow interests of their directors and governors. Successful corporations proved highly responsive to a variety of outside interests including their labour force, as well as the state officials.⁸³ They were also acutely sensitive to their moral and social profile and the need to be seen to contribute to the social fabric of their communities through charitable schemes, principally in Europe.⁸⁴ Corporations were designed to be structures that bound individuals into one legal personality, but careful study of the prosopography of corporate communities proves that corporate entities provided a structural form for diverse groups of people – often with conflicting ideas and differing political persuasions – to enter and exit corporate membership. They allowed for the formation and reformation of commercial networks. As a negotiated and inclusive constitutional actor, the corporation provided durability and longevity through the 'immortality' of its corporate identity, allowing new sets of individuals with different adaptive views to consistently reshape it.⁸⁵

These deliberative, responsive, and protean characteristics of corporations also extended to the corporation's external relationships. For these bodies to succeed commercially, they had to establish effective relationships with outside constituencies which included interlopers, European competitors, and most important, foreign merchants and states. Their commercial imperatives encouraged corporations to serve the interests of non-European peoples. In so doing, trading corporations appeared to finesse a double standard. At home, company members justified their monopolistic corporate trading privileges with reference to the need to intimidate the non-Europeans they traded with.⁸⁶ Overseas, however, corporate actors learned that non-Europeans provided the 'social depths' of their political power and, therefore, the sources of their commercial durability.⁸⁷ Company officials stressed the need to supplicate their commercial ambitions to the local commercial interests of their non-European hosts.⁸⁸ They often cemented relations with those hosts by describing how their corporate activities advanced the commercial ambitions of their local merchant contacts and their society at large.⁸⁹

iii Corporations as Constitutions

Their inclusivity, their responsiveness to outside influence, their skill at forming relationships with external constituencies and capturing differences within their membership all depended upon the corporation's inherently constitutional quality. Trading corporations were – in essence – constitutions that mobilised capital at home and facilitated commercial relations overseas. Trading corporations codified constitutional practices at home – such as the rights of members and the powers these members were subject to – and exported these to non-European contexts where they experimented with and adapted to unusual constitutional techniques.⁹⁰ Their charters were early examples of written constitutions. Their privileges derived from their place of subordination to the state. They used their autonomy from state oversight overseas to become constitutionally creative entities overseas.⁹¹ English corporations integrated spaces enfranchising non-Europeans with one constitutional device and alienating the English with others. The East India Company used its sovereignty overseas, for example, to develop corporate spaces with constitutional provisions that would have been unthinkably tolerant at home. In 1667, for example, the company sustained the English Crown's policy of extending subject rights to Portuguese Catholics in Bombay⁹² The attempts to use their jurisdictional agility made overseas contexts into test cases for the practical possibilities of various forms of government. Trading corporations fetishised the written contracts they negotiated with foreign states. These became constitutive of what the corporations purported to be. Taken together, trading corporations' distinctively adaptive constitutional arrangements became constitutive of a composite, and pluralist, transoceanic framework. Trading companies thus helped structure what Lauren Benton has described as a 'single international legal regime' that integrated the globe on the basis of the common and mutually understood practice of permitting corporate and communal groups' legal authority and autonomy.⁹³ But within this transnational corporate constitutional framework, remarkable constitutional diversity developed. The trading corporation could be both the agent of constitutional coherence but also the harbinger of constitutional diversification. Just as Michael Braddick and Steve Hindle have noted corporations' roles in helping to form an English state structure based upon the relationships between multiple participatory institutions, their constitutional activities on the global stage wove together a global framework for cross-cultural interaction.⁹⁴

iv Corporations as Autonomous and Jurisdictionally Evasive

While trading corporations experimented with different forms of government for their investors, for their servants, and for their trades, they also acted as states in their own right. Historians of early modern England have shown how corporations – as autonomous entities – assisted in actualising state power.⁹⁵ Some of these insights have been projected onto a global context by Philip J Stern in his account of the seventeenth century history of the East India Company.⁹⁶ For Stern, the international setting encouraged the corporation to assume the role of a state whose activities reflected back onto its domicile state, but who would often associate itself with its own transnational and separate corporate interests. The Royal African Company of England, for example, worked like other trading corporations in siding with non-European states and used evidence of constitutional subordination to them to advance their commercial and political agendas at home. To this end, corporations often assumed transnational powers. They operated on behalf of the state, but also apart from the state. In 1705, for example, the Royal African Company sealed an alliance with the French Senegal Company in Africa at a time when the English and French states were at war in Europe. The Royal African Company propagandist, Charles Davenant, defended that company from allegations that it made a separate peace with the French on the basis that trading companies 'are impowered to make Treaties of Peace and Commerce (and War too upon occasion) in any of those parts; according as they find the same suit best with their respective Circumstances at the time; without regard to Peace or War in Europe'.⁹⁷ Corporate power could therefore extend beyond state to transnational power. The constitutional malleability of corporations allowed them to both subordinate and exert themselves at the same time across multiple sovereign, national and cultural spaces. As such, trading corporations channelled agency for both European and non-European initiative and provided opportunities for the pooling of both.

v Corporations as Integrative of the National and Global

Corporations integrated local, national, and global contexts more than any other single institutional type. The corporation had been, since the Middle Ages, a primary tool for local government in England and throughout Europe. It was the legal entity used to govern particular towns, guilds, fraternal organizations, and colleges.⁹⁸ During the sixteenth and seventeenth centuries, these entities transformed themselves into global organisations. Just as corporations brought the world to European cities – in the form of goods, ideas, and peoples, they also brought English people and cultures to non-European contexts and helped alter their character.⁹⁹ Corporations also often depicted themselves as bodies designed to further the national interest. In print, they often described how they would ensure that the international trades they participated in would be managed to further the interests of their domicile nation. A full appreciation of their global sociology suggests, however, that corporations often succeeded when they learned to assist foreign commercial interests and often placed their own commercial concerns ahead of the national interests.

Central to the corporation's distinctive integration of the separate global, national, and local settings for corporate activity was the constant dialogue between the corporation's constitutional privilege at home and abroad and a commercial strategy that calibrated the trading interests of the corporation and its extra-European trading partners. Corporations required political support and constitutional privilege to gather and protect investment. Sustaining this support and privilege depended upon the establishment and maintenance of trade. Durable trading relationships depended upon the countenance of foreigners. Corporations therefore relied upon the agency and initiative of their non-European customers and suppliers. In bridging corporate, national and supranational contexts, trading corporations appeared to finesse a double standard. At home, they justified their monopolistic corporate trading privileges with reference to the need to intimidate the non-Europeans they traded with.¹⁰⁰ Overseas, however, corporations learned that non-Europeans provided the 'social depths' of their political power and, therefore, the sources of their commercial durability.¹⁰¹ Brokering this double standard of exclusivity at home and inclusivity overseas became intrinsic to the corporation's survival by the end of the seventeenth century. This brokerage – and the ways it integrated local and global worlds – became a determinant for corporate success.