In Tokugawa Japan, large companies formed in the major cities, particularly in Osaka.
Sometimes the leaders of these companies would look ahead to the future and consider how to ensure the survival and continued prosperity of their businesses.
Some of them developed and bequeathed a set of company rules to be followed by future leaders.
They often resembled wills.
They attempted to distil the wisdom of past successes and failures.
Let us consider the will of Mitsui Takahira (1722).
It reads, “The members of the House shall with one accord promote the common benefit.”1
Employer-employee relations were to be a two-way street. Leaders were to act with kindness to their direct reports, but it was expected that workers should dedicate themselves to the prosperity of the House.
Indulging in luxury was cautioned against.
The preference was for the eldest son to take over the business. But if their was no male heir or he was clearly incompetent, then another male could be adopted into the family. In the absence of both, a woman could succeed to the position.
In the case of illness, a member of the House was to have their pay reduced by twenty percent. They were not thrown out into the street. They were looked after in that respect, but there was an expectation of work. If one could not give 100%, then one would not receive 100%.
It continues, “Persons in public office are not, as a general rule, prosperous. This is because they concentrate on discharging their public duties and neglect their own family affairs. Do not forget that you are a merchant. You must regard dealing with the government as a sideline of your business.”
Religion was not totally shunned. The gods are mentioned. It is said that they have their place, but it is warned “it is not good to go to extremes. Extremists in religion will never be successful merchants.”
The Mitsui company began in 1673, initially selling dry-goods. Rather quickly it also expanded into money-lending.
So, we can see that it took around fifty years for Mitsui to codify its house rules. These rules provided guidance until the late 1880s. The organisation morphed into a modern company in 1875.
Unity between branches was seen to be very important.
Ability was a key consideration.
Workers who excelled in their positions were given more responsibility. They were tested over time. Subordinates were judged by the ability they displayed and rose in the company if they were trusted by their seniors.
At their core, company house rules in Tokugawa Japan were an attempt to distil wise business practice and pass it on from one generation to another.
Longevity of the company was paramount.
Company heads often saw themselves as custodians, guiding the company safely through the present and into the hands of the next generation.
- Excerpts from the Will of Mitsui Takahira, in Marius B Jenson, The Making of Modern Japan, Harvard University Press, 2002, p. 171 ↩︎
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