A corporation is an organization—usually a group of people or a company—authorized by the state to act as a single entity and recognized as such in law for certain purposes. Early incorporated entities were established by charter. Most jurisdictions now allow the creation of new corporations through registration. Corporations come in many different types but are usually divided by the law of the jurisdiction where they are chartered based on two aspects: by whether they can issue stock, or by whether they are formed to make a profit. Depending on the number of owners, a corporation can be classified as aggregate or sole.
The South Sea Company was a British joint-stock company founded in January 1711, created as a public-private partnership to consolidate and reduce the cost of the national debt. To generate income, in 1713 the company was granted a monopoly to supply African slaves to the islands in the "South Seas" and South America. When the company was created, Britain was involved in the War of the Spanish Succession and Spain and Portugal controlled most of South America. There was thus no realistic prospect that trade would take place, and as it turned out, the Company never realised any significant profit from its monopoly. However, Company stock rose greatly in value as it expanded its operations dealing in government debt, and peaked in 1720 before suddenly collapsing to little above its original flotation price. The notorious economic bubble thus created, which ruined thousands of investors, became known as the South Sea Bubble.
John Law was a Scottish economist who distinguished money, a means of exchange, from national wealth dependent on trade. He served as Controller General of Finances under the Duke of Orleans, who was regent for the juvenile Louis XV of France. In 1716, Law set up a private Banque Générale in France. A year later it was nationalised at his request and renamed as Banque Royale. The private bank had been funded mainly by John Law and Louis XV; three-quarters of its capital consisted of government bills and government-accepted notes, effectively making it the nation's first central bank. Backed only partially by silver, it was a fractional reserve bank. Law also set up and directed the Mississippi Company, funded by the Banque Royale. Its chaotic collapse has been compared to the 17th-century tulip mania in Holland. The Mississippi bubble coincided with the South Sea bubble in England, which allegedly took ideas from it. Law was a gambler who would win card games by mentally calculating odds. He originated ideas such as the scarcity theory of value and the real bills doctrine. He held that money creation stimulated an economy, paper money was preferable to metal, and dividend-paying shares a superior form of money. The term "millionaire" was coined for beneficiaries of Law's scheme.
The Bubble Act 1720 was an Act of the Parliament of Great Britain passed on 11 June 1720 that incorporated the Royal Exchange Assurance Corporation and London Assurance Corporation, but more significantly forbade the formation of any other joint-stock companies unless approved by royal charter.
Friends' Provident Insurance was a banking institution founded in 1832 to serve the needs of the Society of Friends (Quakers). Based in Bradford, Yorkshire, it concentrated on sickness and annuity policies until its life fund acquired Century Insurance in 1918, expanding into general insurance. The restriction to Quaker membership was an increasing constraint but the ties were substantially reduced by the Friends' Proviant Institution Act 1915. Although Century's branch network enabled FPI to expand, the periodic underwriting losses strained the life fund's capital base and Century was sold in 1975. In the year 2000, Friends Provident demutualised and listed on the FT100 Index. After abortive takeover negotiations, Friends accepted a takeover bid from Resolution Limited in 2009.
The Mississippi Company was a corporation holding a business monopoly in French colonies in North America and the West Indies. In 1717, the Mississippi Company received a royal grant with exclusive trading rights for 25 years. The rise and fall of the company is connected with the activities of the Scottish financier and economist John Law who was then the Controller General of Finances of France. Though the company itself started to become profitable, and remained solvent until the collapse of the bubble, when the speculation in French financial circles, and the land development in the region became frenzied and detached from economic reality, the Mississippi bubble became one of the earliest examples of an economic bubble.
The Joint Stock Companies Act 1844 was an Act of the Parliament of the United Kingdom that expanded access to the incorporation of joint-stock companies.
Royal Insurance Holdings plc was a large insurance business originating in Liverpool but based in London from the early 20th century. It merged with Sun Alliance in 1996 to form the Royal & Sun Alliance Insurance Group.
Events from the year 1720 in Great Britain.
The Royal Exchange Assurance, founded in 1720, was a British insurance company. It took its name from the location of its offices at the Royal Exchange, London.
The history of insurance traces the development of the modern business of insurance against risks, especially regarding cargo, property, death, automobile accidents, and medical treatment.
The Guardian Assurance Company was a British insurance company based in London and formed in 1821 to offer both life and fire insurance. Through a combination of organic growth and acquisition it became one of the leading insurance companies. It operated as a mutual organization, meaning that it was owned by its policyholders rather than by shareholders. In 1968 it merged with Royal Exchange to form Guardian Royal Exchange.
Emblematical Print on the South Sea Scheme is an early print by William Hogarth, created in 1721 and widely published from 1724. It caricatures the financial speculation, corruption and credulity that caused the South Sea Bubble in England in 1720–21. The print is often considered the first editorial cartoon or as a precursor of the form.
The history of company law in the United Kingdom concerns the change and development in UK company law within the context of the history of companies, deriving from its predecessors in Roman and English law. Company law in its current form dates from the mid-nineteenth century, however other forms of business association developed long before.
Charles Povey was a British pamphleteer and entrepreneur, who challenged the Royal Mail's postal monopoly by running the "Halfpenny Carriage", a local London postal system similar to William Dockwra's Penny Post. He founded the first joint-stock company for fire insurance, the Exchange House Fire Office later the "Sun Fire Office" that remains in business today as the RSA Insurance Group.
The Alliance Assurance was formed in 1824. It merged with Sun Insurance in 1959 to form Sun Alliance Insurance.
The Sun Fire Office, later Sun Insurance, was founded in London in 1710 and developed into a leading international insurance business. In 1959, Sun Insurance merged with Alliance Assurance to form Sun Alliance.
The Liverpool Fire & Life Insurance Co. was founded in 1836 in response to increased premiums from the London insurance companies. It expanded rapidly, at home and abroad, and after the acquisition of the London insurer, Globe Insurance, in 1864 it became the Liverpool and London Globe Insurance Company. In 1919 it was acquired by another Liverpool firm, Royal Insurance. The enlarged entity merged with the Sun Alliance in 1996 to form the Royal & Sun Alliance Insurance Group.
London and Lancashire Insurance was founded in 1862, and had become one of the U.K.'s leading fire insurers by the end of the 19th century. A series of acquisitions in the early 20th century took the company into accident and marine insurance, as well as life assurance, making it a leading composite insurer. Following a period of consolidation in the industry, London and Lancashire was acquired by Royal Insurance in 1962.
The Scottish Amicable Life Assurance Society, commonly known as Scottish Amicable, was founded in Glasgow in 1826 and became the sixth largest mutual life assurance institution in the UK with 1.9 million policy holders in the mid-1990s.
