Hostname: page-component-848d4c4894-wg55d Total loading time: 0 Render date: 2024-05-01T20:38:11.279Z Has data issue: false hasContentIssue false
  • English
  • Français

Privacy, Publicity, and Reputation: How the Press Regulated the Market in Nineteenth-Century England

Published online by Cambridge University Press:  18 December 2013

James Taylor
Get access Rights & Permissions [Opens in a new window]

Abstract

Many commentators believe that the business press “missed” the story of the twenty-first century—the 2008 economic crisis. Condemned for being too close to the firms they were supposed to be holding to account, journalists failed in their duties to the public. Recent historical studies of business journalism present a similarly pessimistic picture. By contrast, this article stresses the importance of the press as a key intermediary of reputation in the nineteenth-century marketplace. In England, reporters played an instrumental role in opening up companies' general meetings to the public gaze and in warning investors of fraudulent businesses. This regulation by reputation was at least as important as company law in making the City of London a relatively safe place to do business by the start of the twentieth century.

Type
Articles
Information
Business History Review , Volume 87 , Issue 4: Corporate Reputation , Winter 2013 , pp. 679 - 701
Copyright
Copyright © The President and Fellows of Harvard College 2013 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

This article was written while I was visiting research fellow at the Research Institute for History and Culture at Utrecht University, the Netherlands. I would like to thank Chris McKenna for inviting me to contribute to this special issue, and also Walter Friedman and two anonymous referees for their helpful comments on an earlier draft.

1 An idea explored in Schiffrin, Anya, ed., Bad News: How America's Business Press Missed the Story of the Century (New York, 2011)Google Scholar.

2 Schechter, Danny, The Crime of Our Time: Why Wall Street Is Not Too Big to Jail (New York, 2010), ch. 13Google Scholar.

3 Tambini, Damian, “What Is Financial Journalism For? Ethics and Responsibility in a Time of Crisis and Change,” London School of Economics, http://www2.lse.ac.uk/media@lse/POLIS/Files/financialjourn.pdfGoogle Scholar.

4 Barber, Lionel, “Flawed First Draft of History,” Financial Times, 21 04 2009, http://www.ft.com/cms/s/0/95c4cf3e-2ea7-11de-b7d3-00144feabdc0.html#axzz28RRLlTtFGoogle Scholar.

5 However, he does note that a few periodicals like the Economist and the Statist “rose above the venal norm.” Hannah, Leslie, “Pioneering Modern Corporate Governance: A View from London in 1900,” Enterprise & Society 8, no. 3 (2007): 659CrossRefGoogle Scholar.

6 Knight, Peter, “Reading the Market: Abstraction, Personification, and the Financial Column of Town Topics Magazine,” Journal of American Studies 46, no. 4 (2012): 1055–75CrossRefGoogle Scholar. For the early history of U.S. financial coverage, see Forsyth, David P., The Business Press in America, 1750–1865 (Philadelphia, 1964)Google Scholar.

7 Porter, Dilwyn, “‘A Trusted Guide of the Investing Public’: Harry Marks and the Financial News, 1884–1916,” Business History 28, no. 1 (1986): 1–17CrossRefGoogle Scholar.

8 Poovey, Mary, “Writing about Finance in Victorian England: Disclosure and Secrecy in the Culture of Investment,” Victorian Studies 45, no. 1 (2002): 27, 40CrossRefGoogle Scholar.

9 Bignon, Vincent and summarize, Marc Flandreau the literature in “The Economics of Badmouthing: Libel Law and the Underworld of the Financial Press in France before World War I,” Journal of Economic History 71, no. 3 (2011): 618CrossRefGoogle Scholar.

10 Ibid., 649.

11 Parsons, Wayne, The Power of the Financial Press: Journalism and Economic Opinion in Britain and America (Aldershot, 1989), 39Google Scholar.

12 Bignon and Flandreau, “Economics of Badmouthing”; Bignon, Vincent and Miscio, Antonio, “Media Bias in Financial Newspapers: Evidence from Early Twentieth-Century France,” European Review of Economic History 14, no. 3 (2010): 383–432CrossRefGoogle Scholar.

13 Cottrell, P. L., Industrial Finance, 1830–1914 (London, 1980), 54Google Scholar.

14 Johnson, Paul, “Civilizing Mammon: Laws, Morals, and the City in Nineteenth-Century England,” in Civil Histories: Essays Presented to Sir Keith Thomas, ed. Burke, Peter, Harrison, Brian, and Slack, Paul (Oxford, 2000), 318Google Scholar. See also Robb, George, White-Collar Crime in Modern England: Financial Fraud and Business Morality, 1845–1929 (Cambridge, U.K., 1992), esp. ch. 7CrossRefGoogle Scholar; McQueen, Rob, A Social History of Company Law: Great Britain and the Australian Colonies, 1854–1920 (Farnham, 2009)Google Scholar.

15 Hannah, “Modern Corporate Governance.”

16 Smail, John, “Credit, Risk, and Honor in Eighteenth-Century Commerce,” Journal of British Studies 44, no. 3 (2005): 439–56CrossRefGoogle Scholar; Muldrew, Craig, The Economy of Obligation: The Culture of Credit and Social Relations in Early Modern England (London, 1998), ch. 6CrossRefGoogle Scholar.

17 Lee, Alan J., The Origins of the Popular Press in England, 1855–1914 (London, 1976), 29–35, 42–49Google Scholar. The eventual result was a situation in which “reputation is pretty much what the press makes of it,” Bignon, and Flandreau, , “Economics of Badmouthing,” 617Google Scholar.

18 Harris, Ron, Industrializing English Law: Entrepreneurship and Business Organization, 1720–1844 (Cambridge, U.K., 2000), 216–29CrossRefGoogle Scholar.

19 Brown, Lucy, Victorian News and Newspapers (Oxford, 1985), 15Google Scholar.

20 Ibid., 16.

21 Nevett, Terry, “Advertising and Editorial Integrity in the Nineteenth Century,” in The Press in English Society from the Seventeenth to Nineteenth Centuries, ed. Harris, Michael and Lee, Alan (Rutherford, N.J., 1986), 149–67Google Scholar. Lucy Newton notes that joint-stock banks used newspapers and periodicals in their battle with private banks for market share: Newton, Lucy, “The Birth of Joint-Stock Banking: England and New England Compared,” Business History Review 84, no. 1 (2010): 33CrossRefGoogle Scholar.

22 Hampton, Mark, Visions of the Press in Britain, 1850–1950 (Urbana, 2004), 56Google Scholar.

23 Cottrell, , Industrial Finance, 44Google Scholar; McQueen, , Social History, 48Google Scholar.

24 Taylor, James, Creating Capitalism: Joint-Stock Enterprise in British Politics and Culture, 1800–1870 (Woodbridge, U.K., 2006), 136–43Google Scholar.

25 Company meeting reports have been little studied, barring one short article which does not seek to analyze their wider significance: Newman, E. K., “The Origin and Development of Company Meeting Reports,” Journal of Advertising History 6 (1983): 6–14Google Scholar.

26 Freeman, Mark, Pearson, Robin, and Taylor, James, Shareholder Democracies? Corporate Governance in Britain and Ireland before 1850 (Chicago, 2012), 168–70Google Scholar.

27 For an early example, see the Basingstoke Canal Navigation's advertisement in World, 10 June 1788, 1.

28 Vissink, H. G. A., Economic and Financial Reporting in England and the Netherlands (Assen/Maastricht, 1985), 190Google Scholar.

29 Trewman's Exeter Flying-Post, 3 Dec. 1807. Front pages typically contained advertising at this time.

30 Morris, R. J., “A Year in the Public Life of the British Bourgeoisie,” in Cities of Ideas: Civil Society and Urban Governance in Britain, 1800–2000, ed. Colls, Robert and Rodger, Richard (Aldershot, 2004), 124Google Scholar.

31 For the former, see Bank of England, Public Advertiser, 24 03 1788, 2Google Scholar; for the latter, see West India Dock Company, Morning Chronicle, 17 10 1804, 3Google Scholar.

32 Times, 26 02 1824, 3Google Scholar.

33 Times, 28 02 1824, 2Google Scholar.

34 Times, 21 09 1832, 3Google Scholar; Morning Chronicle, 21 09 1832, 3Google Scholar.

35 Morning Chronicle, 1 06 1833, 1Google Scholar.

36 This was the figure provided by one stockbroker, though many of them were purely ephemeral concerns, existing only on paper: English, Henry, A Complete View of the Joint Stock Companies Formed during the Years 1824 and 1825 (London, 1827)Google Scholar.

37 Times, 7 06 1827, 2Google Scholar. Such was still the case in the early twentieth century: Duguid, Charles, How to Read the Money Article (London, 1902, 4th ed.), 98Google Scholar.

38 For more on the punishment of forgers, see Handler, Phil, “Forgery and the End of the ‘Bloody Code’ in Early Nineteenth-Century England,” Historical Journal 48 (2005): 683–702CrossRefGoogle Scholar; for more on companies and the criminal law in the 1820s, see Taylor, James, Boardroom Scandal: The Criminalization of Company Fraud in Nineteenth-Century Britain (Oxford, 2013), ch. 2CrossRefGoogle Scholar.

39 Times, 7 12 1825, 3Google Scholar; 10 Feb. 1826, 3; 28 Aug. 1826, 3.

40 Times, 28 08 1826, 3Google Scholar.

41 Taylor, Boardroom Scandal, ch. 2.

42 York Herald, 21 01 1843, 4Google Scholar.

43 Sheffield and Rotherham Independent, 23 12 1843, 2Google Scholar.

44 Great Southern and Western Railway: Freeman's Journal, 20 03 1845, 3Google Scholar; Great Western Railway: Times, 20 08 1847, 3Google Scholar; London and South Western Railway: Times, 24 12 1849, 3Google Scholar.

45 Times, 26 10 1849, 6, expressed this point particularly stronglyGoogle Scholar.

46 For more on the legislation see McQueen, , Social History, 117–23Google Scholar.

47 For example, the estimated circulation of the Standard increased from 28,000 in 1858 to 130,000 in the mid-1860s; the Daily News went from just 5,000 in the early 1860s to 90,000 by 1870: the price of both titles was reduced from 5d to ld. Ellegård, Alvar, “The Readership of the Periodical Press in Mid-Victorian Britain: Part 2: Directory,” Victorian Periodicals Newsletter 4 (1971): 4Google Scholar.

48 Era, 20 04 1856, 9Google Scholar.

49 Daily News, 15 04 1856, 6Google Scholar.

50 Morning Post, 2 05 1856, 6Google Scholar.

51 Reynolds's Newspaper, 6 07 1856, 6Google Scholar.

52 Times, 17 06 1854, 11Google Scholar.

53 Law, Philip K., “Gregson, Samuel (1793–1865),” Oxford Dictionary of National Biography (Oxford, 2004); online ed. http://www.oxforddnb.com/view/article/53152Google Scholar.

54 Daily News, 13 01 1855, 6Google Scholar. For a similar statement, see the report of the Southport and West Lancashire Banking Company: Liverpool Mercury, 27 01 1881, 7Google Scholar.

55 Times, 1 05 1826, 3Google Scholar.

56 York Herald, 26 02 1842, 3Google Scholar.

57 York Herald, 1 12 1849, 6Google Scholar.

58 Newman, , “Company Meeting Reports,” 9Google Scholar; Duguid, , How to Read the Money Article, 96–97Google Scholar.

59 Taylor, Boardroom Scandal, ch. 8.

60 Newman, , “Company Meeting Reports,” 9Google Scholar.

61 Times, 21 05 1908, 17Google Scholar.

62 Times, 7 02 1911, 22Google Scholar; 12 Oct. 1911, 17.

63 The words of the secretary of the Matabele Mines Company: Times, 15 02 1905, 14Google Scholar.

64 Freeman, , Pearson, , and Taylor, , Shareholder Democracies, 239Google Scholar.

65 Western Mail, 17 08 1878, 4Google Scholar.

66 Essex Standard, 3 11 1888, 7Google Scholar.

67 Explored in Freeman, Pearson, and Taylor, Shareholder Democracies.

68 Satirist, 20 05 1838, 156Google Scholar. The Satirist was a popular and “cynically scandalous” weekly: Dictionary of Nineteenth-Century Journalism, ed. Brake, Laurel and Demoor, Marysa (London, 2009), 557Google Scholar; John Bull, 21 02 1825, 60Google Scholar.

69 Gray, Donald J., “Early Victorian Scandalous Journalism: Renton Nicholson's The Town (1837–42),” in The Victorian Periodical Press: Samplings and Soundings, ed. Shattock, Joanne and Wolff, M. (Leicester, 1982), 317–48Google Scholar.

70 Taylor, James, “Watchdogs or Apologists? Financial Journalism and Company Fraud in Early Victorian Britain,” Historical Research 85 (2012)CrossRefGoogle Scholar.

71 Boase, G. C., “Gregory, Barnard (1796–1852),” rev. Matthew, H. C. G., Oxford Dictionary of National Biography, http://www.oxforddnb.com/view/article/11455Google Scholar.

72 Taylor, “Watchdogs or Apologists?”

73 Western Times, 6 02 1841, 3Google Scholar. See also Bolton Chronicle, repr. in Morning Post, 5 02 1841, 2Google Scholar.

74 6 & 7 Vict. c. 96, ss. 4–6.

75 The Society had cautioned members about the Independent West Middlesex Company: Bury and Norwich Post, 13 01 1841, 2Google Scholar. For more on the Society, see Silberstein-Loeb, Jonathan, “Puff Pieces and Circulation Scams: Middlemen and the Making of the Newspaper Advertising Market, 1881–1901,” Business Archives 103 (2011): 77–92Google Scholar.

76 Morgan, E. Victor and Thomas, W. A., The Stock Exchange: Its History and Functions (London, 1969), 165Google Scholar.

77 Times, 28 06 1849, 6Google Scholar; 4 July 1849, 6; 30 May 1850, 7; 6 June 1850, 6; 23 Oct. 1850, 3.

78 Times, 12 03 1858, 5Google Scholar; 18 Mar. 1858, 7; 23 Mar. 1858, 10.

79 Joint Stock Companies' Journal, 10 05 1856, 328–29Google Scholar; 17 May 1856, 344; 12 July 1856, 8–9.

80 Taylor, James, “Commercial Fraud and Public Men in Victorian Britain,” Historical Research 78 (2005): 230–52CrossRefGoogle Scholar.

81 Vian, Alsager, “Evans, David Morier (1819–1874),” rev. Matthew, H. C. G., Oxford Dictionary of National Biography, http://www.oxforddnb.com/view/article/8950Google Scholar.

82 Evans, D. M., Speculative Notes and Notes on Speculation, Ideal and Real (London, 1864), 1–5Google Scholar.

83 [Evans, David Morier], The City; or, the Physiology of London Business (London, 1845), 134, 96–97Google Scholar.

84 “The City of Gold,” Blackwood's Edinburgh Magazine 96 (09 1864): 377–78Google Scholar.

85 “The Morning and Evening Papers,” Fraser's Magazine 13 (05 1836): 620–21Google Scholar.

86 “Visit to the Times Printing Office,” Chambers' Edinburgh Journal, 17 06 1843, 170Google Scholar.

87 The History of the Times (London, 1935–1984), 2: 596Google Scholar.

88 Spectator, 23 01 1875, 5Google Scholar.

89 Liverpool Mercury, 3 07 1876, 6Google Scholar.

90 O'Connor, Arthur, Hansard Parliamentary Debates, 3rd ser., vol. 258, 8 02 1881, c. 380Google Scholar.

91 44 & 45 Vict. c. 60, ss. 4–5.

92 Times, 16 10 1886, 4Google Scholar; 19 Oct. 1886, 13; 22 Oct. 1886, 9. This was not an isolated victory: the Financial News faced thirty-nine libel actions in its first twenty years and won all of them: Vissink, , Economic and Financial Reporting, 192Google Scholar.

93 Morning Post, 7 07 1857, 6Google Scholar.

94 Cottrell, P. L., “Grant (Gottheimer), Albert (Abraham) Zachariah,” Dictionary of Business Biography: A Biographical Dictionary of Business Leaders Active in Britain in the Period 1860–1980, ed. Jeremy, David J. (London, 1984–1986), 2: 623–29Google Scholar.

95 Standard, 8 07 1871, 6Google Scholar.

96 Times, 19 01 1875, 9Google Scholar; 20 Jan. 1875, 5; Reynolds's Newspaper, 8 10 1876, 2Google Scholar.

97 Morning Post, 21 12 1887, 6Google Scholar.

98 Silberstein-Loeb, , “Puff Pieces,” 81–82Google Scholar.

99 Porter, Dilwyn, “City Editors and the Modern Investing Public: Establishing the Integrity of the New Financial Journalism in Late Nineteenth-Century London,” Media History 4 (1998): 53CrossRefGoogle Scholar; Robb, , White-Collar Crime, 115–17Google Scholar.

100 Porter, “Trusted Guide”; Johnson, “Civilizing Mammon.”

101 For a concise overview of these innovations, see Cottrell, , Industrial Finance, 57–75Google Scholar.

102 Atiyah, P. S., The Rise and Fall of Freedom of Contract (Oxford, 1979), 771–72Google Scholar.

103 For more on this, see Taylor, Boardroom Scandal.

104 Reynolds's Newspaper, 24 01 1875, 3Google Scholar; 18 June 1876, 3.

105 “Contemporary Literature: Journalists and Magazine Writers,” Blackwood's Edinburgh Magazine 125 (01 1879): 80–83Google Scholar.

106 A Financial Journalist, “The Art of Blackmail,” Contemporary Review 74 (08 1898): 198, 201, 205Google Scholar.

107 Hearth and Home, 31 10 1895, 884Google Scholar.

108 The Pall Mall Gazette advocated the latter: 7 July 1898, 1; 12 Aug. 1898, 1.

109 Edwards, J. R. and Webb, K. M., “Use of Table A by Companies Registering under the Companies Act 1862,” Accounting and Business Research 15 (1985): 194CrossRefGoogle Scholar; Edwards, John Richard, Anderson, Malcolm, and Matthews, Derek, “Accountability in a Free-Market Economy: The British Company Audit, 1886,” Abacus 33 (1997): 22CrossRefGoogle Scholar.

110 Lee, , Origins of the Popular Press, 108Google Scholar.

111 This approach goes back to the 1940s and the work of Edwin Sutherland: see his White Collar Crime: The Uncut Version (New Haven, 1983), 250–51Google Scholar.

112 Lee, , Origins of the Popular Press, 281, 288Google Scholar.