The First Modern Corporation

From Medieval France to 1946

By Meril Markley, A.B., J.D., LL.M.

This website celebrates the 14th century pioneers who created the first modern corporations while formulating the basic tenets of corporate governance. What they invented, and the lessons they learned in the process, can guide modern investors, executives, lawmakers, and regulators as they wrestle with the challenges facing 21st century companies.

Environmental, Social and Governance (ESG)? Corporate Social Responsibility (CSR)? Governance, Risk and Compliance (GRC)? Diversity, Equity and Inclusion (DEI)? Shareholder Value? Stakeholder Capitalism? "Nothing new," the 14th century creators of the first modern corporations would have proclaimed. To apply medieval versions of these modern axioms, grounded in Christian beliefs, was intuitive for early investors in shaping their companies for long and productive lives.

In the Late Middle Ages, eighty or so French men and women launched ventures to build water-powered mills on the Garonne River in southwestern France. Inspired by growing demands for energy, they were willing to pool their capital while assuming the risk it could be lost. They yearned for the rewards a successful venture could bring for themselves and their community, if they could fashion a vehicle to accomplish it. Of the resulting companies, many were successful and one lasted into the 20th century.

Had the owners of the first modern corporation been around in 2019 when the Business Round Table published its pronouncement on stakeholder capitalism, surely they would have marveled at a kerfuffle about something they had embedded in corporate governance because it was indispensable. Without balancing the priorities of all of the stakeholders all of the time, their groundbreaking enterprise could not have lasted a decade, much less the hundreds of years in store for it. Undeniably, 14th century French investors were the first to embrace their own version of stakeholder capitalism to shape an enduring commercial entity and a bulwark of the community.

Using the menu at the top of this page, journey back with me to the Middle Ages as I examine the first modern corporations, explore the corporate governance developed for them, and discern the lasting nature of the innovations. Some of them will seem familiar, having been absorbed into the body of law and regulations which specify what makes a corporation and how it should behave in the 21st century. That the achievements have failed to attract the recognition they merit is an injustice I hope this website will help to rectify.

In highlighting the accomplishments of these medieval visionaries, I have relied upon the treatise published in 1953 by Professor Germain Sicard based on his analysis of the original records kept by the companies. The book arose out of his doctoral thesis at the beginning of a long and distinguished career teaching law at the University of Toulouse.

This website is for information purposes only. It constitutes neither the provision of legal advice nor an offer to perform legal services.