Shifting Value: The Rise of Intangibles

The first Industrial Revolution in the 18th century focused on the mechanization of industrial processes with the use of steam instead of human or animal labour. Although there had been pollution prior to this time, the emissions from mechanized factories was the beginning of the dangerous anthropogenic emissions as we know them today.

One of the consequences of wealthy families providing equity capital and several of their members becoming directors of the company was that other stakeholders, particularly employees, saw these shareholders as the owners of the company. Shareholders were given the primacy of place in regard to all the other stakeholders involved in the business of the company; suppliers, creditors, financers, employees, advisers, etc.

During the 19th and 20th centuries, the second Industrial Revolution was characterized by mass production leading to huge profits. One if the companies benefitting from this mass production was the Ford Motor Company, which wanted to increase the wages of its employees for working long hours for meeting the extra production demands. This was contented by Dodge Brothers, a minority shareholder of the company, that the company had a duty to pay the excess profits as a special dividend to shareholders before increasing the wages…