Tuesday, 22 September 2015

The directors of Hammonds

I’m continuing my Hammonds theme with more about the board of directors. Who seem to have been an obliging, if passive, bunch.

This might explain why:

"The board of directors was composed almost entirely of country gentlemen who had sold their breweries to Hammonds and had been rewarded with seats on the board, a nice annual fee, a rising dividend, and surrogate glory. In return they gave unquestioning and, it must be said, cheerful support to his endeavours. The heads of departments - accounts, property, transport, wines and spirits, the head brewers, and the tied estate area managers were sent for, questioned, and given their orders. The monthly board meetings were astutely stage managed, the best port drunk, egos massaged, ignorance smoothed over, and all went well, with rising profits and rising share prices."
"The Brewing Industry 1950 - 1990", by Anthony Avis, 1997, page 10.

I believe this was a common phenomenon at the time: owners who were happy enough to let someone else get on with the dirty business of running the brewery while they earned money for doing nothing. Wish I could get a job like that.

"Until the middle 1950s, whilst Bentley & Shaw was still considered an equal partner of Hammonds - believe it or not, even the company secretaryship was held jointly by Rex Tinker and Bob Tullie, who had their offices in Lockwood and Bradford and were barely on speaking terms - its share of the joint board meetings was held at six in the evening, a tradition going back a century or more. It was a civilised way of conducting business, when the owners of that business were drawn from one family and the family house stood in the brewery estate; and so the custom continued. After all, it did not interfere with the country pursuits of the directors in daylight hours.”
"The Brewing Industry 1950 - 1990", by Anthony Avis, 1997, pages 21 - 22.

Nice to see that the occasional board meeting didn’t keep the directors from doing whatever they did in the countryside. Presumably kill animals in a variety of novel and impractical ways.

Drones is the word that comes to mind:

“The business of the board meeting over, and the outcome of the monthly sweep on who could most neatly affix the company seal to official documents, the directors retired to the sitting room for a pre dinner drink, whilst Miss Roberts laid out the dining room for dinner. Needless to say, a good dinner was enjoyed and by ten o'clock they were ready for bed. There were two bedrooms in the house, occupied by Lance Dumaresq and Neville Shaw who had travelled farthest to attend, and who were in any case family. The others lived in Yorkshire somewhere and went home; they all had their own private chauffeurs - a common enough situation among the landed gentry then. The next day the two residents would be taken to the railway station and they would catch their trains back to London and Shrewsbury. They were not gluttons, they were not filled with any overweening sense of their own importance, they were not intent upon their perquisites and privileges; what they enjoyed was what was usual to their way of life and their pockets. They understood good plain English cooking, fine wines, vintage port, Cuban cigars. Seeing them in action at such occasions, made one realise it all came naturally, and their style made it informal and relaxed; something which is lost in many present and similar events attended by captains of industry, newly come to affluence and power."
"The Brewing Industry 1950 - 1990", by Anthony Avis, 1997, pages 21 - 22.

You could argue that this type of people were a factor in the decline of British industry. No real interest in producing anything, just having a pleasant, comfortable lifestyle.

But is the more professional director really such a great improvement? The author reckons not:

"They sat in the boardroom by right of family and ownership; none in the company questioned that right or envied that position. There were no promotions from the ranks of employees to the boardroom, and it was not expected. An employee rose to a senior position in the company, and was respected and had great influence, but he was different, not better not worse, just different. This personalised semi feudal social structure changed when the owners sold out, and the company became the property of a big corporate organisation, in turn owned by a multiplicity of even bigger corporations, and the directors were just employees elevated by direction to that office; they had the status, often the greed, rarely the style. In today's corporate organisations, with their depersonalised ownership, cohesion and personal loyalty give way to a different set of values. What often happens is that an employee director board will be tempted to erect its own barriers against the rest of those who work for the company, create their own privileges, vote their own remuneration, award their own perquisites. Japanese business corporations have gone some way towards meeting the hierarchical problems posed by modern company structures; let us hope the same will apply in the Western world."
"The Brewing Industry 1950 - 1990", by Anthony Avis, 1997, page 22.

A passive capitalist bastard or an active one – which is worse? I’d probably prefer to avoid the corporate type. At least the drones would have a decent drop of port to drink.


Gary Gillman said...

Those are very interesting observations by Avis, compressing some important political and social-econonic perceptions in just a few sentences. He expressed both the Conservative philosophy as it was until the 70's, and the competing vision which has always been primarily the American model. The latter offers the risks he mentions but is inherently more democratic. The old Conservative view that society has age-old differences which in the interest of stability are better preserved than thrown open to the ramparts had a built-in inequality which rankled over time, hence the revolution wrought by Margaret Thatcher.

The people who disliked her were of course often on the left, more so than the rump of old Conservatives her thinking, and appeal, largely displaced, but the left never saw (IMO) how radically democratic her vision was. Or rather, they had a competing vision of democracy, one which arguably creates a different type of cabal, not small groups of citizen-businesspeople who wish to preserve their own new privileges (now on an international scale) but power centres dominated by civil servants and social organizations. Every system has its pros and cons, everyone can win, lose or be static under each competing vision, but in my view, dynamic change and technological improvement are best achieved by the American model. Carly Fiorina, whatever one thinks of her business career, never would have gotten ahead in the old world Avis described... By the way that old system was never airtight and many British success stories belied it, but that he was expressing a general truth about the old economy as it was, I have no doubt.


Ed said...

I don't think I'd actually met any capitalist bastards until I entered the brewing industry but this post does seem strangely familiar in parts.