How did the environment of the American Fur Company change in the 1830’s? What deep historical forces are implicated in these changes? The American Fur Company:
The American Fur Company was founded by John Jacob Astor in 1808. The company grew to monopolize the fur trade in the United States by 1830, and became one of the largest businesses in the country. In early 1830’s it seemed nothing could slow Astor. But this environment suddenly changed for fur companies. Although the American Fur company was still competing with other Fur companies, unfavorable trends were building that would bring it down. Factors Effecting Fur Companies Environment:
A. Demand for beaver start falling due to change in fashion trend of beaver hat in European and American gentleman. B. Silk hat became the new trend.
C. New ways of felting hats without using fibrous under hair from beaver pelts had developed, and nutria pelts from South America were entering the market. D. In 1832 trade was nearly an end during a worldwide cholera epidemic because many people thought the disease was spread on transported furs. E. Beaver populations, were no longer sufficient by over trapping. F. Losses of human life rose due to poisoned snakes and crow to encounter more hostile tribes such as Blackfeet, who poisoned their arrows with rattlesnake venom and conducted open war against trappers. These were some of the forces that changes the environment for American Fur company and fall of American Fur Company and Fur Industry begun. Question#04: who were the most important stake holders of the nineteenth-century fur industry? Were they treated responsibly by the standards of the day? By the standards of today? Now before discussing the stakeholders of 19th century its very important that one have very clear understanding of who is stakeholder; Stake holders: An entity that is benefited or burdened by the actions of a corporation or whose actions may benefit or burdened the corporation. The corporation has an ethical duty towards the entities.
There are two further categories of stakeholders:
1. Primary Stakeholders
2. Secondary Stakeholders
Primary stakeholders are a small numbers of constituents for which the impact of the relationship is immediate, continuous and powerful on both the firm and the constituent. Secondary Stakeholders includes a possibly broad range of constituent in which the relationship involves less mutual immediacy, benefit, burden or power to influence. Now moving towards the stakeholders of 19th Century:
Primary Stakeholders: These were Indian trappers, Fur traders, Government, Corporations who trade in fur, Indian tribes these entities were the primary stakeholders of the fur Industry because the effected directly by the changes in the fur Industry. Secondary Stakeholders: Among them are the people who use the end product of fur and the people who got affected by the cholera as it was thought that it was spread because of the fur. By the Standards of the Day:
They were not treated responsibly even by that day standards, rather standards were ignored because the government was not so strong to interrupt the big companies operating in the fur market. Just taking the example of American Fur Company: The Board of Directors were elected just because of the charter requirement and 99.9% of the stock was retained by the Astor, elected himself as the president and subsequently dividends whenever he wanted to compensated himself. The partnership was a fiction and he never intended nor wanted to share either the proceeds of the company or any portion of the fur trade that he could control. The American Fur Company had crushed its competitors by implementing such rules which leads to the road to monopoly. This company made many other companies as its agents and through its agents it liquidated other competitors, building its own trading posts next to every one of theirs, engaging in cutthroat price...