Dutch East India Company

In Dutch, the name of the company was the Vereenigde Nederlandsche Geoctroyeerde Oostindische Compagnie, abbreviated as the VOC, literally the 'United Dutch Chartered East India Company' (the United East India Company). The company's monogram logo consisted of a large capital 'V' with an O on the left and a C on the right half and was possibly the first globally recognised corporate logo. It appeared on corporate items, such as flags, cannons, and coins.

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', 'Jan Company', or 'Jan Compagnie'.

Before the Dutch Revolt, which began in 1566/68, the Brabant city of Antwerp had played an important role as a distribution centre in northern Europe. After 1591, the Portuguese used an international syndicate of the German Fugger family and Welser family, as well as Spanish and Italian firms, which operated out of 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, known as the Iberian Union, with which the Dutch Republic was at war. The Portuguese Empire thus became an appropriate target for Dutch military incursions. These factors motivated Dutch merchants to enter the intercontinental spice trade themselves. Further, a number of Dutch merchants and explorers, such as Jan Huyghen van Linschoten and Cornelis de Houtman, obtained firsthand knowledge of the "secret" Portuguese trade routes and practices, providing further opportunity for the Dutch to enter the trade.

The stage was set for Dutch expeditions to the Indonesian islands, beginning with Cornelis de Houtman in 1595 and in 1598, Jacob Van Neck in 1598, among others. During the four-ship exploratory expedition by Frederick de Houtman in 1595 to Banten, the main pepper port of West Java, the crew clashed with Portuguese and indigenous Javanese. 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 in 1596, 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 1598, a fleet of eight ships under Jacob van Neck were the first Dutch fleet to reach the 'Spice Islands' of Maluku, also known as the Moluccas, cutting out the Javanese middlemen. …

While the VOC mainly operated in what later became the Dutch East Indies (modern-day Indonesia), the company also had important operations elsewhere. It employed people from different continents and origins in the same functions and working environments. Although it was a Dutch company, its employees included not only people from the Netherlands, but also many from Germany and other countries. Besides the diverse north-west European workforce recruited by the VOC in the Dutch Republic, the VOC made extensive use of local Asian labour markets. As a result, the personnel of the various VOC offices in Asia consisted of European and Asian employees. Asian or Eurasian workers could be employed as sailors, soldiers, writers, carpenters, smiths, or as simple unskilled workers. At the height of its existence, the VOC had 25,000 employees who worked in Asia and 11,000 who were en route. Also, while most of its shareholders were Dutch, about a quarter of the initial shareholders were Zuid-Nederlanders (people from an area that includes modern Belgium and Luxembourg), and there were also a few dozen Germans.

The VOC had two types of shareholders: the participanten, who could be seen as non-managing members, and the 76 bewindhebbers (later reduced to 60) who acted as managing directors. This was the usual set-up for Dutch joint-stock companies at the time. The innovation in the case of the VOC was that the liability of not just the participanten but also of the bewindhebbers was limited to the paid-in capital (usually, bewindhebbers had unlimited liability). The VOC therefore was a limited liability company. Also, the capital would be permanent during the lifetime of the company. As a consequence, investors that wished to liquidate their interest in the interim could only do this by selling their share to others on the Amsterdam Stock Exchange. Confusion of confusions, a 1688 dialogue by the Sephardi Jew Joseph de la Vega analysed the workings of this one-stock exchange.

The VOC consisted of six Chambers (Kamers) in port cities: Amsterdam, Delft, Rotterdam, Enkhuizen, Middelburg, and Hoorn. Delegates of these chambers convened as the Heeren XVII (Lords or Gentlemen Seventeen). …

The seventeenth-century Dutch businessmen, especially the VOC investors, were possibly history's first recorded investors to seriously consider the problems of corporate governance. Isaac Le Maire, who is known as history's first recorded short seller, was also a sizeable shareholder of the VOC. In 1609, he complained of the VOC's poor corporate governance. On 24 January 1609, Le Maire filed a petition against the VOC, marking the first recorded expression of shareholder activism. In what is the first recorded corporate governance dispute, Le Maire formally charged that the VOC's board of directors (the Heeren XVII) sought to "retain another's money for longer or use it ways other than the latter wishes" and petitioned for the liquidation of the VOC in accordance with standard business practice. Initially the largest single shareholder in the VOC and a bewindhebber sitting on the board of governors, Le Maire apparently attempted to divert the firm's profits to himself by undertaking 14 expeditions under his own accounts instead of those of the company. Since his large shareholdings were not accompanied by greater voting power, Le Maire was soon ousted by other governors in 1605 on charges of embezzlement, and was forced to sign an agreement not to compete with the VOC. Having retained stock in the company following this incident, in 1609 Le Maire would become the author of what is celebrated as "first recorded expression of shareholder advocacy at a publicly traded company".

In 1622, the history's first recorded shareholder revolt also happened among the VOC investors who complained that the company account books had been "smeared with bacon" so that they might be "eaten by dogs". The investors demanded a "reeckeninge", a proper financial audit. The 1622 campaign by the shareholders of the VOC is a testimony of genesis of corporate social responsibility (CSR) in which shareholders staged protests by distributing pamphlets and complaining about management self enrichment and secrecy.

The company's global headquarters were in Amsterdam, with other posts in the Dutch cities of Delft, Enkhuizen, Hoorn, Middelburg and Rotterdam. In Africa, the trading posts and colonies were in Dutch Mauritius in 1638–1658 and 1664–1710, and in the Dutch Cape Colony between 1652 and 1806. The South Asian and Indonesian posts and colonies of the company were in Batavia, Dutch East Indies, Dutch Coromandel in 1806–1825, Dutch Suratte in 1616–1825, Dutch Bengal from 1827 to 1825, Dutch Ceylon from 1640 to 1796, and Dutch Malabar from 1661 to 1795.

The Japanese post was in Hirado, Nagasaki from 1609 to 1641, but was relocated to Dejima from 1641 to 1853. In Taiwan, the company had bases in Anping (Fort Zeelandia), Tainan (Fort Provincia), Wang-an, Penghu on the Pescadores Islands (Fort Vlissingen; 1620–1624), Keelung (Fort Noord-Holland and Fort Victoria) and Tamsui (Fort Antonio).

In Malaysia, the company was based in Dutch Malacca in 1641–1795 and 1818–1825. In Thailand, the company was based in Ayutthaya in 1608–1767. In Vietnam, the company was based in Hanoi/Tonkin in 1636–1699, and in Hội An in 1636–1741.