- Company name, logo, and flag
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- Formative years
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- Notations du Berger hollandais
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- Overall program
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- Decline and fall
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For other uses, see East India Company (disambiguation).
17th-century Dutch trading company
The Dutch East India Company, officially the United East India Company (Dutch: Vereenigde Oostindische Compagnie; VOC) was a megacorporation founded by a government-directed amalgamation of several rival Dutch trading companies (voorcompagnieën) in the early 17th century. It was established on 20 March 1602, as a chartered company to trade with Mughal India during the period of proto-industrialization, from which 50% of textiles and 80% of silks were imported, chiefly from its most developed region known as Bengal Subah. In addition, the company traded with Indianised Southeast Asian countries when the Dutch government granted it a 21-year monopoly on the Dutch spice trade.
It has been often labelled a trading company (i.e.
a company of merchants who buy and sell goods produced by other people) or sometimes a shipping company. However, VOC was in fact a proto-conglomerate company, diversifying into multiple commercial and industrial activities such as international trade (especially intra-Asian trade), shipbuilding, and both production and trade of East Indian spices,Formosan sugarcane, and South African wine. The Company was a transcontinental employer and an early pioneer of outward foreign direct investment.
In the early 1600s, by widely issuing bonds and shares of stock to the general public,[a] VOC became the world's first formally listed public company.[b] In other words, it was the first corporation to be listed on an official stock exchange.[c] It was influential in the rise of corporate-led globalisation in the early modern period.
It is said to be worth $7.9 trillion in today's value.
With its pioneering institutional innovations and powerful roles in global business history, the Company is often considered by many to be the forerunner of modern corporations. In many respects, modern-day corporations are all the 'direct descendants' of the VOC model. It was their 17th century institutional innovations and business practices that laid the foundations for the rise of giant global corporations in subsequent centuries – as a highly significant and formidable socio-politico-economic force of the modern-day world – to become the dominant factor in almost all economic systems today.
They also served as the direct model for the organisational reconstruction of the English/British East India Company in 1657. The Company, for nearly 200 years of its existence (1602–1800), had effectively transformed itself from a corporate entity into a state or an empire in its own right.[d]One of the most influential and best expertly researched business enterprises in history, the VOC's world has been the subject of a vast amount of literature that includes both fiction and nonfiction works.
The company was historically an exemplary company-state[e] rather than a pure for-profit corporation. Originally a government-backed military-commercial enterprise, the VOC was the wartime brainchild of leading Dutch republican statesman Johan van Oldenbarnevelt and the States-General. From its inception in 1602, the Company was not only a commercial enterprise but also effectively an instrument of war in the young Dutch Republic's revolutionary global war against the powerful Spanish Empire and Iberian Union (1579–1648).
In 1619, the Company forcibly established a central position in the Javanese city of Jayakarta, changing the name to Batavia (modern-day Jakarta).
Over the next two centuries the Company acquired additional ports as trading bases and safeguarded their interests by taking over surrounding territory. To guarantee its supply, the Company established positions in many countries and became an early pioneer of outward foreign direct investment.[f] In its foreign colonies, the VOC possessed quasi-governmental powers, including the ability to wage war, imprison and execute convicts, negotiate treaties, strike its own coins, and establish colonies. With increasing importance of foreign posts, the Company is often considered the world's first true transnational corporation.[g] Along with the Dutch West India Company (WIC/GWIC), the VOC was seen as the international arm of the Dutch Republic and the symbolic power of the Dutch Empire.
To further its trade routes, the VOC-funded exploratory voyages, such as those led by Willem Janszoon (Duyfken), Henry Hudson (Halve Maen), and Abel Tasman, revealed largely unknown landmasses to the western world. In the Golden Age of Netherlandish cartography (c.
1570s–1670s), VOC navigators and cartographers helped shape geographical knowledge of the world as we know it today.
Socio-economic changes in Europe, the shift in power balance, and less successful financial management resulted in a slow decline of the VOC between 1720 and 1799. After the financially disastrous Fourth Anglo-Dutch War (1780–1784), the company was nationalised in 1796, and finally dissolved in 1799.
All assets were taken over by the government with VOC territories becoming Dutch government colonies.
The company has been criticised for its monopolistic policy, exploitation, colonialism, uses of violence, and slavery.
- 1Company name, logo, and flag
- 3Organisational structure
- 4Shareholder activism and governance issues
- 5Main trading posts, settlements, and colonies
- 6Conflicts and wars involving the VOC
- 7Historical roles and legacy
- 7.1Institutional innovations and impacts on modern-day global business practices and financial system
- 7.2Impacts on social, economic, financial, political, and military history of the Netherlands
- 7.3Roles in the history of the global economy and international relations
- 7.4Artistic, scientific, technological, and cultural legacies of the VOC World
- 7.5Contributions in the Age of Exploration
- 9Cultural depictions
- 10VOC World etymologies
- 11Populated places established by VOC people
- 12Important heritage sites in the VOC World
- 13Buildings and structures
- 14Archives and records
- 15Field of VOC World studies
- 16VOC timeline and historical firsts
- 18See also
- 22External links
Company name, logo, and flag
See also: Colonial Indian companies, Colonial India, Greater India, Dutch East Indies, Spanish East Indies, Category:Colonial Indian companies, and East Indiaman
In Dutch, the name of the company is Vereenigde Oostindische Compagnie or Verenigde Oost-Indische Compagnie, which is abbreviated to VOC.
The company's monogram logo was possibly the first globally recognised corporate logo. The logo of the VOC consisted of a large capital 'V' with an O on the left and a C on the right leg. It appeared on various corporate items, such as cannons and coins. The first letter of the hometown of the chamber conducting the operation was placed on top .
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The monogram, versatility, flexibility, clarity, simplicity, symmetry, timelessness, and symbolism are considered notable characteristics of the VOC's professionally designed logo. Those elements ensured its success at a time when the concept of the corporate identity was virtually unknown. An Australian vintner has used the VOC logo since the late 20th century, having re-registered the company's name for the purpose. The flag of the company was red, white, and blue, with the company logo embroidered on it.
Around the world, and especially in English-speaking countries, the VOC is widely known as the 'Dutch East India Company'. The name 'Dutch East India Company' is used to make a distinction from the [British] East India Company (EIC) and other East Indian companies (such as the Danish East India Company, French East India Company, Portuguese East India Company, and the Swedish East India Company).
The company's alternative names that have been used include the 'Dutch East Indies Company', 'United East India Company', 'United East Indian Company', 'United East Indies Company', 'Jan Company', or 'Jan Compagnie'.
See also: History of the Dutch East India Company (VOC), Evolution of the Dutch Empire, Dutch East India Company in Indonesia, Economic history of the Dutch Republic, and Financial history of the Dutch Republic
See also: First Dutch Expedition to Indonesia, Second Dutch Expedition to Indonesia, and Voorcompagnie
Further information: Spice trade and Cape Route
Before the Dutch Revolt, Antwerp had played an important role as a distribution centre in northern Europe.
After 1591, however, the Portuguese used an international syndicate of the German Fuggers and Welsers, and Spanish and Italian firms, that used Hamburg as the northern staple port to distribute their goods, thereby cutting Dutch merchants out of the trade. At the same time, the Portuguese trade system was unable to increase supply to satisfy growing demand, in particular the demand for pepper. Demand for spices was relatively inelastic; therefore, each lag in the supply of pepper caused a sharp rise in pepper prices.
In 1580, the Portuguese crown was united in a personal union with the Spanish crown, with which the Dutch Republic was at war. The Portuguese Empire therefore became an appropriate target for Dutch military incursions.
These factors motivated Dutch merchants to enter the intercontinental spice trade themselves. Further, a number of Dutchmen like Jan Huyghen van Linschoten and Cornelis de Houtman obtained first hand knowledge of the "secret" Portuguese trade routes and practices, thereby providing opportunity.
The stage was thus set for the four-ship exploratory expedition by Frederick de Houtman in 1595 to Banten, the main pepper port of West Java, where they clashed with both the Portuguese and indigenous Indonesians.
Houtman's expedition then sailed east along the north coast of Java, losing twelve crew members to a Javanese attack at Sidayu and killing a local ruler in Madura. Half the crew were lost before the expedition made it back to the Netherlands the following year, but with enough spices to make a considerable profit.
In 1598, an increasing number of fleets were sent out by competing merchant groups from around the Netherlands. Some fleets were lost, but most were successful, with some voyages producing high profits.
In March 1599, a fleet of eight ships under Jacob van Neck was the first Dutch fleet to reach the 'Spice Islands' of Maluku, the source of pepper, cutting out the Javanese middlemen. The ships returned to Europe in 1599 and 1600 and the expedition made a 400 percent profit.
In 1600, the Dutch joined forces with the Muslim Hituese on Ambon Island in an anti-Portuguese alliance, in return for which the Dutch were given the sole right to purchase spices from Hitu. Dutch control of Ambon was achieved when the Portuguese surrendered their fort in Ambon to the Dutch-Hituese alliance.
In 1613, the Dutch expelled the Portuguese from their Solor fort, but a subsequent Portuguese attack led to a second change of hands; following this second reoccupation, the Dutch once again captured Solor in 1636.
East of Solor, on the island of Timor, Dutch advances were halted by an autonomous and powerful group of Portuguese Eurasians called the Topasses. They remained in control of the Sandalwood trade and their resistance lasted throughout the 17th and 18th centuries, causing Portuguese Timor to remain under the Portuguese sphere of control.
At the time, it was customary for a company to be funded only for the duration of a single voyage and to be liquidated upon the return of the fleet.
Investment in these expeditions was a very high-risk venture, not only because of the usual dangers of piracy, disease and shipwreck, but also because the interplay of inelastic demand and relatively elastic supply of spices could make prices tumble, thereby ruining prospects of profitability. To manage such risk, the forming of a cartel to control supply would seem logical.
In 1600, the English were the first to adopt this approach by bundling their resources into a monopoly enterprise, the English East India Company, thereby threatening their Dutch competitors with ruin.
In 1602, the Dutch government followed suit, sponsoring the creation of a single "United East Indies Company" that was also granted monopoly over the Asian trade.
For a time in the seventeenth century, they were able to monopolise the trade in nutmeg, mace, and cloves and to sell these spices across European kingdoms and emperor Akbar The Great's Mughal Empire at fourteen to seventeen times the price they paid in Indonesia; while Dutch profits soared, the local economy of the Spice Islands was destroyed.
With a capital of 6,440,200 guilders, the charter of the new company empowered it to build forts, maintain armies, and conclude treaties with Asian rulers. It provided for a venture that would continue for 21 years, with a financial accounting only at the end of each decade.
In February 1603, the Company seized the Santa Catarina, a 1500-ton Portuguese merchant carrack, off the coast of Singapore. She was such a rich prize that her sale proceeds increased the capital of the VOC by more than 50%.
Also in 1603, the first permanent Dutch trading post in Indonesia was established in Banten, West Java, and in 1611, another was established at Jayakarta (later "Batavia" and then "Jakarta"). In 1610, the VOC established the post of Governor General to more firmly control their affairs in Asia.
To advise and control the risk of despotic Governors General, a Council of the Indies (Raad van Indië) was created. The Governor General effectively became the main administrator of the VOC's activities in Asia, although the Heeren XVII, a body of 17 shareholders representing different chambers, continued to officially have overall control.
VOC headquarters were located in Ambon during the tenures of the first three Governors General (1610–1619), but it was not a satisfactory location.
Although it was at the centre of the spice production areas, it was far from the Asian trade routes and other VOC areas of activity ranging from Africa to India to Japan. A location in the west of the archipelago was thus sought.
The Straits of Malacca were strategic but became dangerous following the Portuguese conquest, and the first permanent VOC settlement in Banten was controlled by a powerful local ruler and subject to stiff competition from Chinese and English traders.
In 1604, a second English East India Company voyage commanded by Sir Henry Middleton reached the islands of Ternate, Tidore, Ambon and Banda.
In Banda, they encountered severe VOC hostility, sparking Anglo-Dutch competition for access to spices. From 1611 to 1617, the English established trading posts at Sukadana (southwest Kalimantan), Makassar, Jayakarta and Jepara in Java, and Aceh, Pariaman and Jambi in Sumatra, which threatened Dutch ambitions for a monopoly on East Indies trade.
In 1620, diplomatic agreements in Europe ushered in a period of co-operation between the Dutch and the English over the spice trade. This ended with a notorious but disputed incident known as the 'Amboyna massacre', where ten Englishmen were arrested, tried and beheaded for conspiracy against the Dutch government. Although this caused outrage in Europe and a diplomatic crisis, the English quietly withdrew from most of their Indonesian activities (except trading in Banten) and focused on other Asian interests.
In 1619, Jan Pieterszoon Coen was appointed Governor-General of the VOC.
He saw the possibility of the VOC becoming an Asian power, both political and economic. On 30 May 1619, Coen, backed by a force of nineteen ships, stormed Jayakarta, driving out the Banten forces; and from the ashes established Batavia as the VOC headquarters. In the 1620s almost the entire native population of the Banda Islands was driven away, starved to death, or killed in an attempt to replace them with Dutch plantations. These plantations were used to grow cloves and nutmeg for export.
Coen hoped to settle large numbers of Dutch colonists in the East Indies, but implementation of this policy never materialised, mainly because very few Dutch were willing to emigrate to Asia.
Another of Coen's ventures was more successful. A major problem in the European trade with Asia at the time was that the Europeans could offer few goods that Asian consumers wanted, except silver and gold.
European traders therefore had to pay for spices with the precious metals, which were in short supply in Europe, except for Spain and Portugal. The Dutch and English had to obtain it by creating a trade surplus with other European countries.
Coen discovered the obvious solution for the problem: to start an intra-Asiatic trade system, whose profits could be used to finance the spice trade with Europe. In the long run this obviated the need for exports of precious metals from Europe, though at first it required the formation of a large trading-capital fund in the Indies. The VOC reinvested a large share of its profits to this end in the period up to 1630.
The VOC traded throughout Asia, benefiting mainly from Bengal.
Ships coming into Batavia from the Netherlands carried supplies for VOC settlements in Asia.
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Silver and copper from Japan were used to trade with the world's wealthiest empires, Mughal India and Qing China, for silk, cotton, porcelain, and textiles. These products were either traded within Asia for the coveted spices or brought back to Europe. The VOC was also instrumental in introducing European ideas and technology to Asia.
The Company supported Christian missionaries and traded modern technology with China and Japan. A more peaceful VOC trade post on Dejima, an artificial island off the coast of Nagasaki, was for more than two hundred years the only place where Europeans were permitted to trade with Japan. When the VOC tried to use military force to make Ming dynasty China open up to Dutch trade, the Chinese defeated the Dutch in a war over the Penghu islands from 1623 to 1624, forcing the VOC to abandon Penghu for Taiwan.
The Chinese defeated the VOC again at the Battle of Liaoluo Bay in 1633.
The Vietnamese Nguyen Lords defeated the VOC in a 1643 battle during the Trịnh–Nguyễn War, blowing up a Dutch ship.
The Cambodians defeated the VOC in the Cambodian–Dutch War from 1643 to 1644 on the Mekong River.
In 1640, the VOC obtained the port of Galle, Ceylon, from the Portuguese and broke the latter's monopoly of the cinnamon trade. In 1658, Gerard Pietersz.
Hulft laid siege to Colombo, which was captured with the help of King Rajasinghe II of Kandy. By 1659, the Portuguese had been expelled from the coastal regions, which were then occupied by the VOC, securing for it the monopoly over cinnamon. To prevent the Portuguese or the English from ever recapturing Sri Lanka, the VOC went on to conquer the entire Malabar Coast from the Portuguese, almost entirely driving them from the west coast of India. When news of a peace agreement between Portugal and the Netherlands reached Asia in 1663, Goa was the only remaining Portuguese city on the west coast.
In 1652, Jan van Riebeeck established a resupply outpost at the Cape of Storms (the southwestern tip of Africa, now Cape Town, South Africa) to service company ships on their journey to and from East Asia.
The cape was later renamed Cape of Good Hope in honour of the outpost's presence.
Although non-company ships were welcome to use the station, they were charged exorbitantly. This post later became a full-fledged colony, the Cape Colony, when more Dutch and other Europeans started to settle there.
Through the seventeenth century VOC trading posts were also established in Persia, Bengal, Malacca, Siam, Formosa (now Taiwan), as well as the Malabar and Coromandel coasts in India.
Direct access to mainland China came in 1729 when a factory was established in Canton. In 1662, however, Koxinga expelled the Dutch from Taiwan (seeHistory of Taiwan).
In 1663, the VOC signed the "Painan Treaty" with several local lords in the Painan area that were revolting against the Aceh Sultanate.
The treaty allowed the VOC to build a trading post in the area and eventually to monopolise the trade there, especially the gold trade.
By 1669, the VOC was the richest private company the world had ever seen, with over 150 merchant ships, 40 warships, 50,000 employees, a private army of 10,000 soldiers, and a dividend payment of 40% on the original investment.
Many of the VOC employees inter-mixed with the indigenous peoples and expanded the population of Indos in pre-colonial history.
Around 1670, two events caused the growth of VOC trade to stall.
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In the first place, the highly profitable trade with Japan started to decline. The loss of the outpost on Formosa to Koxinga in the 1662 Siege of Fort Zeelandia and related internal turmoil in China (where the Ming dynasty was being replaced with the China's Qing dynasty) brought an end to the silk trade after 1666.
Though the VOC substituted Mughal Bengal's for Chinese silk other forces affected the supply of Japanese silver and gold. The shogunate enacted a number of measures to limit the export of these precious metals, in the process limiting VOC opportunities for trade, and severely worsening the terms of trade.
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Therefore, Japan ceased to function as the lynchpin of the intra-Asiatic trade of the VOC by 1685.
Even more importantly, the Third Anglo-Dutch War temporarily interrupted VOC trade with Europe. This caused a spike in the price of pepper, which enticed the English East India Company (EIC) to enter this market aggressively in the years after 1672. Previously, one of the tenets of the VOC pricing policy was to slightly over-supply the pepper market, so as to depress prices below the level where interlopers were encouraged to enter the market (instead of striving for short-term profit maximisation).
The wisdom of such a policy was illustrated when a fierce price war with the EIC ensued, as that company flooded the market with new supplies from India. In this struggle for market share, the VOC (which had much larger financial resources) could wait out the EIC.
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Indeed, by 1683, the latter came close to bankruptcy; its share price plummeted from 600 to 250; and its president Josiah Child was temporarily forced from office.
However, the writing was on the wall. Other companies, like the French East India Company and the Danish East India Company also started to make inroads on the Dutch system. The VOC therefore closed the heretofore flourishing open pepper emporium of Bantam by a treaty of 1684 with the Sultan.
Also, on the Coromandel Coast, it moved its chief stronghold from Pulicat to Negapatnam, so as to secure a monopoly on the pepper trade at the detriment of the French and the Danes. However, the importance of these traditional commodities in the Asian-European trade was diminishing rapidly at the time. The military outlays that the VOC needed to make to enhance its monopoly were not justified by the increased profits of this declining trade.
Nevertheless, this lesson was slow to sink in and at first the VOC made the strategic decision to improve its military position on the Malabar Coast (hoping thereby to curtail English influence in the area, and end the drain on its resources from the cost of the Malabar garrisons) by using force to compel the Zamorin of Calicut to submit to Dutch domination.
In 1710, the Zamorin was made to sign a treaty with the VOC undertaking to trade exclusively with the VOC and expel other European traders.
For a brief time, this appeared to improve the Company's prospects. However, in 1715, with EIC encouragement, the Zamorin renounced the treaty. Though a Dutch army managed to suppress this insurrection temporarily, the Zamorin continued to trade with the English and the French, which led to an appreciable upsurge in English and French traffic.
The VOC decided in 1721 that it was no longer worth the trouble to try to dominate the Malabar pepper and spice trade. A strategic decision was taken to scale down the Dutch military presence and in effect yield the area to EIC influence.
The 1741 Battle of Colachel by warriors of Travancore under Raja Marthanda Varma defeated the Dutch. The Dutch commander Captain Eustachius De Lannoy was captured.
Marthanda Varma agreed to spare the Dutch captain's life on condition that he joined his army and trained his soldiers on modern lines. This defeat in the Travancore-Dutch War is considered the earliest example of an organised Asian power overcoming European military technology and tactics; and it signalled the decline of Dutch power in India.
The attempt to continue as before as a low volume-high profit business enterprise with its core business in the spice trade had therefore failed.
The Company had however already (reluctantly) followed the example of its European competitors in diversifying into other Asian commodities, like tea, coffee, cotton, textiles, and sugar. These commodities provided a lower profit margin and therefore required a larger sales volume to generate the same amount of revenue. This structural change in the commodity composition of the VOC's trade started in the early 1680s, after the temporary collapse of the EIC around 1683 offered an excellent opportunity to enter these markets.
The actual cause for the change lies, however, in two structural features of this new era.
In the first place, there was a revolutionary change in the tastes affecting European demand for Asian textiles, coffee and tea, around the turn of the 18th century. Secondly, a new era of an abundant supply of capital at low interest rates suddenly opened around this time.
The second factor enabled the Company easily to finance its expansion in the new areas of commerce. Between the 1680s and 1720s, the VOC was therefore able to equip and man an appreciable expansion of its fleet, and acquire a large amount of precious metals to finance the purchase of large amounts of Asian commodities, for shipment to Europe.
The overall effect was approximately to double the size of the company.
The tonnage of the returning ships rose by 125 percent in this period.
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However, the Company's revenues from the sale of goods landed in Europe rose by only 78 percent. This reflects the basic change in the VOC's circumstances that had occurred: it now operated in new markets for goods with an elastic demand, in which it had to compete on an equal footing with other suppliers.
This made for low profit margins. Unfortunately, the business information systems of the time made this difficult to discern for the managers of the company, which may partly explain the mistakes they made from hindsight.
This lack of information might have been counteracted (as in earlier times in the VOC's history) by the business acumen of the directors. Unfortunately by this time these were almost exclusively recruited from the political regent class, which had long since lost its close relationship with merchant circles.
Low profit margins in themselves do not explain the deterioration of revenues.
To a large extent the costs of the operation of the VOC had a "fixed" character (military establishments; maintenance of the fleet and such). Profit levels might therefore have been maintained if the increase in the scale of trading operations that in fact took place had resulted in economies of scale. However, though larger ships transported the growing volume of goods, labour productivity did not go up sufficiently to realise these. In general the Company's overhead rose in step with the growth in trade volume; declining gross margins translated directly into a decline in profitability of the invested capital.
The era of expansion was one of "profitless growth".
Specifically: "[t]he long-term average annual profit in the VOC's 1630–70 'Golden Age' was 2.1 million guilders, of which just under half was distributed as dividends and the remainder reinvested.
The long-term average annual profit in the 'Expansion Age' (1680–1730) was 2.0 million guilders, of which three-quarters was distributed as dividend and one-quarter reinvested.
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In the earlier period, profits averaged 18 percent of total revenues; in the latter period, 10 percent. The annual return of invested capital in the earlier period stood at approximately 6 percent; in the latter period, 3.4 percent."
Nevertheless, in the eyes of investors the VOC did not do too badly.
The share price hovered consistently around the 400 mark from the mid-1680s (excepting a hiccup around the Glorious Revolution in 1688), and they reached an all-time high of around 642 in the 1720s. VOC shares then yielded a return of 3.5 percent, only slightly less than the yield on Dutch government bonds.
Decline and fall
After 1730, the fortunes of the VOC started to decline. Five major problems, not all of equal weight, explain its decline over the next fifty years to 1780:
- There was a steady erosion of intra-Asiatic trade because of changes in the Asiatic political and economic environment that the VOC could do little about.
These factors gradually squeezed the company out of Persia, Suratte, the Malabar Coast, and Bengal. The company had to confine its operations to the belt it physically controlled, from Ceylon through the Indonesian archipelago.
The volume of this intra-Asiatic trade, and its profitability, therefore had to shrink.
- The way the company was organised in Asia (centralised on its hub in Batavia), that initially had offered advantages in gathering market information, began to cause disadvantages in the 18th century because of the inefficiency of first shipping everything to this central point. This disadvantage was most keenly felt in the tea trade, where competitors like the EIC and the Ostend Company shipped directly from China to Europe.
- The "venality" of the VOC's personnel (in the sense of corruption and non-performance of duties), though a problem for all East India Companies at the time, seems to have plagued the VOC on a larger scale than its competitors.
To be sure, the company was not a "good employer". Salaries were low, and "private-account trading" was officially not allowed. Not surprisingly, it proliferated in the 18th century to the detriment of the company's performance. From about the 1790s onward, the phrase perished under corruption (vergaan onder corruptie, also abbreviated VOC in Dutch) came to summarise the company's future.
- A problem that the VOC shared with other companies was the high mortality and morbidity rates among its employees.
This decimated the company's ranks and enervated many of the survivors.
- A self-inflicted wound was the VOC's dividend policy. The dividends distributed by the company had exceeded the surplus it garnered in Europe in every decade from 1690 to 1760 except 1710–1720. However, in the period up to 1730 the directors shipped resources to Asia to build up the trading capital there.
Consolidated bookkeeping therefore probably would have shown that total profits exceeded dividends.
In addition, between 1700 and 1740 the company retired 5.4 million guilders of long-term debt. The company therefore was still on a secure financial footing in these years. This changed after 1730. While profits plummeted the bewindhebbers only slightly decreased dividends from the earlier level. Distributed dividends were therefore in excess of earnings in every decade but one (1760–1770). To accomplish this, the Asian capital stock had to be drawn down by 4 million guilders between 1730 and 1780, and the liquid
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In the same year, the VOC undertook the world's first recorded IPO. "Going public" enabled the company to raise the vast sum of 6.5 million guilders quickly. The VOC's institutional innovations and business practices laid the foundations for the rise of modern-day global corporations and capital markets that now dominate the world's economic systems, whether for good or bad.