The Company: A Short History of a Revolutionary Idea is an apt title for this book. It is a short history, but a very interesting one. And its interesting because the subject matter is treated with enthusiasm which becomes a source of entertainment.
This is a book written for the non-academic, acting almost like a Reader’s Digest version of a business history course. The book enthuses how the revolutionary idea known as the Company is one of the single greatest contributions to civilization’s development. This enthusiasm does not mean that they ignore the negative aspects of the Company, namely the grotesque pursuit of profit and company goals over human needs such as in the Belgian Congo, but the tone of the book is fan-boyish.
Tone aside, the authors do accomplish what they set out to do. They illustrate how the idea of the Company is pretty revolutionary. Basically a government body grants a charter for a collective of disperse individuals to work together by pooling their capital and resources for the purpose of wealth accumulation. The book talks how the different national governments dealt with the rise of the Company (limited-liability joint-share corporations), and how in places like Britain they were treated with suspicion and animosity. In contrast the citizens of the United States they were seen as vehicles towards greater autonomy from government.
So what is so revolutionary about the Company? Simply that it is the manifestation of economic and personal liberty. In granting corporations to exist, governments are saying to its citizens that they have the freedom to associate and work together for common gain. It is little wonder why the Western liberal democracies not only are the most free societies, but also the wealthiest per capita. Government simply cannot duplicate the diversity and creativity of its citizens.While this book does not outright state this, it is clear that they are implying it through their examples and enthusiasm.
The authors illustrate how Anglo-American “shareholder” corporations (operated for the benefit of owners) and German-style “stakeholder” corporations (which include workers and community representatives on their governing boards) are different from each other, and are even further removed from Japanese family-companies. We are provided numerous examples where the tension and cooperation between between society and company inspires human dynamism; the Virginia Company, for example, effectively introduced democracy in America in 1619.
Understanding the rise of corporations helps understand why they are so successful and pervasive in human culture. They have become more influential than churches, ethnic societies, and even some of the world’s weaker governments, though the authors do point out that no company has actual hard power since they can pass no laws nor command any armies.
The Company is a fun read. It helps the reader understand the basis of wealth creation in the modern world. The anti-Company / socialist camp will find lots lacking in this book to contrast their position with, as this book is not a theoretical treatise, but an enthusiastic historical summary. The Company is not a defense of capitalism, but an explanation why capitalism has been as successful as it has been. And that is a point that no critic will be able to dispute.
(3 stars out of 5 ? an entertaining and short introduction to how business companies have changed the modern world.)