Accounting, publicity and class conflict in Victorian Britain

Abstract

This paper studies the role of publicly available accounting information in class conflict between capital and labour in Victorian Britain. The company investigated – the Staveley Coal & Iron Company Ltd – is one of the earliest industrial enterprises registered under the Companies Act 1862. The period studied is 1863, when the company was incorporated, through to 1900 by which time the workforce comprised approximately 6400 colliery and iron workers. The history of the company is contextualised in two ways. First, by positioning it within the coal and iron industry in terms of market share, size and profitability. Second, by locating Staveley’s labour management policies within relevant contemporary economic theory. It is then revealed, through an in-depth study of the company’s archives, that the directors sought to manage and manipulate the workforce through the provision of welfare facilities and by denying worker access to accounting information relevant for wage bargaining purposes. The study also unveils the directors’ report as an instrument deployed to project the image of a caring employer and to explain, to its shareholders, the sound business sense of committing resources for that purpose.

Keywords:

• accounting history
• capital and labour
• class conflict
• corporate disclosure

Acknowledgements

This study has benefitted from conversations with Trevor Boyns and Jim Haslam and inputs from two anonymous reviewers.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

1 Waterhouse qualified in 1883, was a leading figure at Price, Waterhouse & Co. for 35 years and served on the Council of the Institute of Chartered Accountants in England and Wales from 1914 to 1928 (Edwards 2004).

2 The records of SCI Ltd are located at the Derbyshire Record Office (DRO), catalogue reference no. D3808.

3 Wage-fund theory came under attack from around the start-date of this paper, by economists who argued that the price of labour was principally determined by consumer demand for business outputs, but the theory remained influential until the end of the nineteenth century.

4 Copies of The Times accessed through The Times Digital Archive at: https://www.gale.com/intl/c/the-times-digital-archive.

5 Markham was educated at the University of Edinburgh located in a city with which Adam Smith had numerous academic and domestic connections (Winch 2004). Markham studied chemistry but, coming from a middle-class family of lawyers, he would likely have been conversant with the ideas of political economists (Chapman 1981, p. 72).

6 Copies of provincial newspapers accessed through the British Newspaper Archive at: https://www.britishnewspaperarchive.co.uk/search/advanced.

7 In 1865, the company’s colliery workers included ‘some 500–600 Irishmen, who congregated in Chesterfield’ in a downmarket district known as the ‘dog kennels’ (Chapman 1981, pp. 48–49).

8 The Children’s Employment Commission 1842 collected harrowing evidence of the ways in which the ‘butties’ treated colliers, who became ‘old men before they are young ones’, and boys subjected to severe corporal punishment (Williams 1959, pp. 63–66).

9 There were also unskilled labourers – for example, surface workers and those assisting in the layout a railway underground – who were remunerated on a time basis.

10 From 1838 to 1848, Stephenson occupied Tapton House, Chesterfield; a Georgian mansion which later became the home of Charles Markham and, afterwards, his son.

11 The published accounts of SCI Ltd, for the period 1864–1950, are filed at the DRO under reference no. D3808/1/6/1.

12 The enormity of these returns can be further appreciated when compared with the 3% payable on government consolidated stock, at that time, which equates to an overall return of 19.5% over the same time period.

13 There was an overman for each pit who had responsibility for carrying out daily safety inspections and recording the work performed to operate the piece work system.

14 Dividends had gone up from £39,100 in 1888 to £58,650 in 1889, or from 5% to 7.5% on issued share capital.

15 For a review of some of the substantial literature on the biased treatment of capital expenditure to shape the level of reported profit, either through immediate write-off or by manipulating the amount of the depreciation charge, see Edwards (2019b, ch. 14).

16 Interim dividend omitted from comparison because bonus issue made after the interim dividend for 1872–1873 had been declared.

17 This calculation relates to initial investors who retained their shares in 1900.

18 1872 is the first year for which market prices are available that are directly comparable with shares in issue in 1900

19 He was described as the ‘leading spirit’ at Bolckow, Vaughan & Co. Ltd, John Brown & Co. Ltd, the Tredegar Iron & Coal Co. Ltd, Palmer’s Shipbuilding & Iron Co. Ltd and the Sheepbridge Coal & Iron Co. Ltd, as well as SCI Ltd ‘and other undertakings of a similar character’ (Obituary 1895).