Whether it’s Google, Amazon, Starbucks using legal loopholes to avoid corporation tax; Apple’s subcontractors’ deathly abuse of workers in China; the ongoing call for justice from Bhopal over Union Carbide; Shell, BP’s activities in numerous vulnerable oil-affected communities; the bailout of RBS and Lloyds/TSB as ‘too big to fail'; or G4S taking over running sections of the welfare state, Nick Robins’ book The corporation that changed the world, How the East India Company shaped the modern multinational will help you understand the deep precedence, and act.
This acclaimed book has just gone into its 2nd edition, and it’s a fascinating contribution to analysing how we’ve got to this stage in business history. What’s the approach? As Nick says “The Corporation that Changed the World grew out of two intertwined themes: first, how the East India Company prefigured many of the issues generated by the modern multinational; and second, how public memory in Europe and Asia have been shaped by reactions to this imperial corporation, which, in Britain means the Company is largely invisible. The 2nd edition builds on the argument in both instances – looking in more detail at the Company’s involvement in two world shattering events: the opium trade between India and China, and the build up of corruptly enforced debts in India, perhaps the world’s first ‘third world debt’ crisis.”
Why is the book so readable? First of all, Nick’s background in socially responsible investment, social justice and environmentalism makes for an incredibly rich read. Secondly, there’s the ‘live’ quality which runs through it: in the 2000’s, Nick and Platform collaborated on a series of public discussion-walks around the sites of the East India Company in London, situating the historical in the contemporary. Nick’s book takes us with him through this travelogue aspect, which includes vivid research trips to India, Bangladesh and China. This is a popular history suffused with contemporary relevance.
In terms of content, the book layers a solid investigation into corporate ethics with the gripping story of the East India Company’s rollercoaster ride from its foundation by royal charter in 1600 to its shameful demise in the 1860s.
From a number of ships setting sail from Blackwall Dock in a life-or-death race against European competitors to the Spice Islands and back, to the astonishing fact of a private foreign company owning and (mis-)governing most of the Indian subcontinent, and profiting from the illegal Opium trade with China, the reader is swept along in ever-increasing disbelief at a corporation leading government by the nose. Sound familiar?
In this way, history becomes so relevant. The Company’s 260 years starts off with high-risk merchant-adventuring, ferocious competition, and boom and bankruptcy in the 17th century. This is so reminiscent of the 1986 mergers and acquisitions frenzy post-Big Bang, or more recently the Dot-com bubble.
In the 18th century the company starred at strangle-hold monopoly, double-dealing, piracy, and millionaire-making, backed by military might in the form of a 250,000 strong EIC army. The commodities were the new and exotic teas, spices, fabrics: as an example of value, pepper was so highly priced that it was kept in a vault under the Royal Exchange. This was merchandise that needed guarding at all stages of its import. But a private army? While most multinationals today can’t be seen to have official armies, Platform’s research shows that many operating in ‘high-risk, high-profit’ areas have contracts with government and private security companies (that act like military) such as Shell in the Niger Delta, or provide resources in fraught civil war situations such as in the case of Heritage Oil in Congo. Some have been found to pay armed militant groups such as – once again – Shell. Others are in a position to influence the British government military to their own ends, as is revealed in our recent report ‘Secret Subsidy‘ on oil companies, piracy, and the British Navy.
Back to the East India Company, by the late 18th century, the British government and people were riven with disagreement on whether to laugh, rage, or cry over the enormous public and private wealth, and the outrageous acts generated by the company over which it appears to have barely any control. By the mid-19th century, the Company was dogged by controversy, court cases over business practices, and after the horrors of what British school books call the Indian Mutiny and what in India is called The First Indian Revolution, the government came to its conclusion. Too big to fail, too profitable to be allowed to go bust, the East India Company was nationalised, handily ‘giving’ Britain most of India, having successfully beggared and corrupted the once thriving Bengal in the process. The Bangladesh of today still reels from the injustice, and memories are just beneath the surface across the continent. Given the racialised nature of the exploitation of resources, it’s no wonder that while white Britain conveniently forgets, others refuse. As Nick says in India’s ‘The Economic Times’,
When the book was first published, [I] found that its market success mirrored the gulf in memory. It was much better received in India than in the UK.
No wonder then that in Tower Hamlets, which is home to Britain’s highest population of people of Bengali descent, Nick’s ongoing work and our early discussion-walks on the East India Company have found ready allies.
Time for the rest of us to wake up to this sleeping monster and what it can teach us.
‘The Corporation that changed the world, How the East India Company shaped the modern multinational’ by Nick Robins, published Pluto Press, 2012. ISBN 9 780745 331959