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An Admiralty for Asia: Isaac le Maire and conflicting conceptions about the corporate governance of the VOC

Author

Listed:
  • Gelderblom, O.
  • de Jong, A.
  • Jonker, J.

Abstract

The Dutch East India Company or VOC in 1602 showed many characteristics of modern corporations, including limited liability, freely transferable shares, and well-defined managerial functions. However, we challenge the notion of the VOC as the precursor of modern corporations to argue that the company was a hybrid, combining elements from traditional partnerships with a governance structure modeled on existing public-private partnerships. The company’s charter reflected this hybrid structure in the preeminent position given to the Estates General as the VOC’s main principal, to the detriment of shareholders’ interests. Protests by Isaac le Maire and Willem Usselinx about the board’s disregard for shareholders rooted in a conviction that it ought to conform to traditional partnerships with their judicious balance between stakeholders’ interests. However, the perceived public interest of a strong military presence in Asia prevented shareholders’ protests from changing the corporate governance.

Suggested Citation

  • Gelderblom, O. & de Jong, A. & Jonker, J., 2010. "An Admiralty for Asia: Isaac le Maire and conflicting conceptions about the corporate governance of the VOC," ERIM Report Series Research in Management ERS-2010-026-F&A, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    • Handle: RePEc:ems:eureri:19907
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    File URL: https://repub.eur.nl/pub/19907/ERS-2010-026-FA.pdf
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    References listed on IDEAS

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    1. Jensen, Michael C. & Meckling, William H., 1976. "Theory of the firm: Managerial behavior, agency costs and ownership structure," Journal of Financial Economics, Elsevier, vol. 3(4), pages 305-360, October.
    2. Becht, Marco & Bolton, Patrick & Roell, Ailsa, 2003. "Corporate governance and control," Handbook of the Economics of Finance, in: G.M. Constantinides & M. Harris & R. M. Stulz (ed.), Handbook of the Economics of Finance, edition 1, volume 1, chapter 1, pages 1-109, Elsevier.
    3. de Vries,Jan & van der Woude,Ad, 1997. "The First Modern Economy," Cambridge Books, Cambridge University Press, number 9780521570619.
    4. Gelderblom, Oscar & Jonker, Joost, 2004. "Completing a Financial Revolution: The Finance of the Dutch East India Trade and the Rise of the Amsterdam Capital Market, 1595–1612," The Journal of Economic History, Cambridge University Press, vol. 64(3), pages 641-672, September.
    5. de Vries,Jan & van der Woude,Ad, 1997. "The First Modern Economy," Cambridge Books, Cambridge University Press, number 9780521578257.
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    Cited by:

    1. van Bavel, Bas, 2016. "The Invisible Hand?: How Market Economies have Emerged and Declined Since AD 500," OUP Catalogue, Oxford University Press, number 9780199608133, Decembrie.

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    More about this item

    Keywords

    VOC; corporate governance; dutch east india company;
    All these keywords.

    JEL classification:

    • M - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics

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