Managerial Failure and Corporate Ownership in Edwardian Britain Revisited

Michael Aldous (Queen’s University, Belfast), Philip Fliers (Queen’s University, Belfast), John Turner (Queen’s University, Belfast)

The business and economic history literature has traditionally made the following claims: (1) British management in the Edwardian era was amateur largely because the ownership of corporations was concentrated in the hands of families, and (2) this managerial failure contributed to the long-term decline of British business as well as the British economy. In this paper, we revisit these claims by looking at the ownership and control of the largest 1,800 British companies in 1911. We examine director ownership to see whether concentrated family ownership was common. We find that it was uncommon and that most large companies had a separation of ownership and control. This raises the question as to who ultimately controlled Edwardian companies. To address this question, we analyse the backgrounds and characteristics of this cadre of individuals to understand how they got to the top. Were they in these powerful positions because of their social, family and corporate connections or were they professional managers? We then explore whether ownership and control were associated with corporate performance and longevity.