# Mutinational corporations prior to WW2 **URL:** \ **Category:** Factual Questions\ **Created:** [August 10, 2004, 8:04am UTC](https://boards.straightdope.com/t/mutinational-corporations-prior-to-ww2/259169 "2004-08-10T08:04:12Z")\ **Posts on this page:** 20\ **Page:** 1
**Author:** ![HPL](https://avatars.discourse-cdn.com/v4/letter/h/3da27b/32.png) [@HPL](https://boards.straightdope.com/u/HPL)\ **Post date:** [August 10, 2004, 8:04am UTC](https://boards.straightdope.com/t/mutinational-corporations-prior-to-ww2/259169/1 "2004-08-10T08:04:12Z")
I’m just curious. Was there a lot of muti-nationalism in corporations prior to WW2? For example, what are the chances you’d have a British construction company having a branch office in Germany during the 1930’s? Or maybe just doing business there? ---
**Author:** ![UDS](https://avatars.discourse-cdn.com/v4/letter/u/ecae2f/32.png) [@UDS](https://boards.straightdope.com/u/UDS)\ **Post date:** [August 10, 2004, 8:25am UTC](https://boards.straightdope.com/t/mutinational-corporations-prior-to-ww2/259169/2 "2004-08-10T08:25:43Z")
Globalisation really starts in the 19th century, with improvements in transport and communications. This makes it possible to raise capital in country A for investment in country B; hence the phenomenon of the foreign investor. The British were the kings of the business, but other countries were also involved. There were many companies incorporated in London whose entire business was conducted in other countries. And there were many companies headquartered in London, but doing business all over the world. At first these would be the obvious candidates like banks, shipping companies and so forth, but over time a diversity of companies emerged. Basically, anybody looking for capital to run a capital-intensive business in a developing country where there wasn’t much capital would look to Europe or North America for capital (and, often, expertise). So, for example, most of the (extensive) Argentinian railway system was developed by British companies with British capital – companies which owned and operated no railways in Britain (or,indeed, anywhere outside Argentina). All of this was old hat by the 1920s and 1930s, and there were huge flows of international trade, including substantial volumes of international capital representing investment and, therefore, corporate multinationalism. There would, however, be little point in a British construction company opening a branch in Germany. The resources needed to run a construction business – technology and labour – were readily available in Germany to German entrepreneurs. A British company would be competing head-to-head with local companies, who would have the advantage of local management and local contacts. Unless the British company had some patented process or machinery which gave it an advantage over German companies, why would any German customer prefer to deal with it? It would make much more sense for the British company to open a branch in, say, India, where British managers and engineers could be combined with cheap Indian labour in a market where government and commercial circles, at any rate, were relatively familiar to (and open to) British companies. I suppose a British construction firm might have established a _purchasing_ office in Germany, to have access to the plant and machinery produced by Germany’s (world-class) engineering industry, which it could use in its British construction projects. But the British engineering industry was pretty good at that time, too. ---
**Author:** ![Mops](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/mops/32/16494_2.png) [@Mops](https://boards.straightdope.com/u/Mops)\ **Post date:** [August 10, 2004, 10:36am UTC](https://boards.straightdope.com/t/mutinational-corporations-prior-to-ww2/259169/3 "2004-08-10T10:36:59Z")
Construction is perhaps not the best example for international investment in the 1930s. Multinational companies were more prominent in industries like automobiles or oil. For example, both GM and Ford had large German subsidiaries in the 1930s (GM under the Opel brand - they bought carmaker Adam Opel AG at the end of the 1920s if I recollect correctly). ---
**Author:** ![Shalmanese](https://avatars.discourse-cdn.com/v4/letter/s/45deac/32.png) [@Shalmanese](https://boards.straightdope.com/u/Shalmanese)\ **Post date:** [August 10, 2004, 12:08pm UTC](https://boards.straightdope.com/t/mutinational-corporations-prior-to-ww2/259169/4 "2004-08-10T12:08:41Z")
I think the Dutch East India company is commonly touted as one of the first true MNCs. ---
**Author:** ![RiverRunner](https://avatars.discourse-cdn.com/v4/letter/r/977dab/32.png) [@RiverRunner](https://boards.straightdope.com/u/RiverRunner)\ **Post date:** [August 10, 2004, 3:42pm UTC](https://boards.straightdope.com/t/mutinational-corporations-prior-to-ww2/259169/5 "2004-08-10T15:42:26Z")
Also, remember that the “I” in IBM stands for “International.” The name of the Computing - Tabulating - Recording Company was changed to International Business Machines in 1924. From [IBM’s history site](http://www-1.ibm.com/ibm/history/history/decade_1920.html): > [@](#): > > By then, the company’s business had expanded both geographically and functionally, including the completion of three manufacturing facilities in Europe. RR ---
**Author:** ![APB](https://avatars.discourse-cdn.com/v4/letter/a/8e8cbc/32.png) [@APB](https://boards.straightdope.com/u/APB)\ **Post date:** [August 10, 2004, 4:16pm UTC](https://boards.straightdope.com/t/mutinational-corporations-prior-to-ww2/259169/6 "2004-08-10T16:16:08Z")
The major example of a British (actually Anglo-Dutch) multinational with extensive interests in Germany in the 1930s was Unilever. According to this [article](http://www.ehs.org.uk/ehs/conference2004/assets/wubs.doc), which discusses the subject in some detail, by September 1939, it had ‘over 100 operating companies in Germany’ and 33,900 employees in Germany, Austria and the Sudetenland. ---
**Author:** ![bonzer](https://avatars.discourse-cdn.com/v4/letter/b/45deac/32.png) [@bonzer](https://boards.straightdope.com/u/bonzer)\ **Post date:** [August 10, 2004, 6:19pm UTC](https://boards.straightdope.com/t/mutinational-corporations-prior-to-ww2/259169/7 "2004-08-10T18:19:55Z")
Further to **APB** ’s example, Unilever were sufficiently prominent in pre-war Germany that, in a lecture delivered in November 1937, the then-obscure Adolf Eichmann singled them out and accused them of being the front organisation for the usual vast Jewish conspiracy - see Cesarani’s new _Eichmann_ (Heinemann, 2004, p57-8). ---
**Author:** ![Mk\_VII](https://avatars.discourse-cdn.com/v4/letter/m/5f9b8f/32.png) [@Mk\_VII](https://boards.straightdope.com/u/Mk_VII)\ **Post date:** [August 10, 2004, 9:03pm UTC](https://boards.straightdope.com/t/mutinational-corporations-prior-to-ww2/259169/8 "2004-08-10T21:03:02Z")
Shell, Ford and GM all had British subsidiaries by this time (GM had purchased Vauxhall Motors almost at the dawn of the automobile age). But British companies operated largely inside the tariff wall of Imperial Preference. ---
**Author:** ![Tuckerfan](https://avatars.discourse-cdn.com/v4/letter/t/eada6e/32.png) [@Tuckerfan](https://boards.straightdope.com/u/Tuckerfan)\ **Post date:** [August 10, 2004, 9:43pm UTC](https://boards.straightdope.com/t/mutinational-corporations-prior-to-ww2/259169/9 "2004-08-10T21:43:14Z")
> [@tschild](#): > > Construction is perhaps not the best example for international investment in the 1930s. Multinational companies were more prominent in industries like automobiles or oil. For example, both GM and Ford had large German subsidiaries in the 1930s (GM under the Opel brand - they bought carmaker Adam Opel AG at the end of the 1920s if I recollect correctly). Actually, it was the late 1930s that GM bought Opel. When WW II broke out, the head of GM is reputed to have said something like, “We’re above the the petty little squabbles of nations.” _Lots_ of creative accounting went on at Ford and GM during the war, with both corporations claiming after the war was over that they never saw a dime in profit from their German divisions during the war. Henry Ford was offered the VW factory after the war as compensation for the losses sustained by the German division, but turned it down, saying it “wasn’t worth a damn.” ---
**Author:** ![kellner](https://avatars.discourse-cdn.com/v4/letter/k/c2a13f/32.png) [@kellner](https://boards.straightdope.com/u/kellner)\ **Post date:** [August 10, 2004, 10:02pm UTC](https://boards.straightdope.com/t/mutinational-corporations-prior-to-ww2/259169/10 "2004-08-10T22:02:01Z")
> [@Tuckerfan](#): > > Actually, it was the late 1930s that GM bought Opel. It was sold on 3/17/1929. ([GM History](http://www.gm.com/company/corp_info/history/gmhis1920.html)) Btw. the same year _Coca-Cola Germany_ started its operations. ---
**Author:** ![Tuckerfan](https://avatars.discourse-cdn.com/v4/letter/t/eada6e/32.png) [@Tuckerfan](https://boards.straightdope.com/u/Tuckerfan)\ **Post date:** [August 10, 2004, 11:17pm UTC](https://boards.straightdope.com/t/mutinational-corporations-prior-to-ww2/259169/11 "2004-08-10T23:17:52Z")
> [@kellner](#): > > It was sold on 3/17/1929. ([GM History](http://www.gm.com/company/corp_info/history/gmhis1920.html)) > > Btw. the same year _Coca-Cola Germany_ started its operations. Damn it! You mean _The Hindenburg_ movie was wrong? Next you’ll be telling me that it _wasn’t_ a bomb onboard which caused the _Hindenburg_ to explode! 😉 ---
**Author:** ![GorillaMan](https://avatars.discourse-cdn.com/v4/letter/g/50afbb/32.png) [@GorillaMan](https://boards.straightdope.com/u/GorillaMan)\ **Post date:** [August 10, 2004, 11:50pm UTC](https://boards.straightdope.com/t/mutinational-corporations-prior-to-ww2/259169/12 "2004-08-10T23:50:59Z")
> [@Mk VII](#): > > … British companies operated largely inside the tariff wall of Imperial Preference. Without wanting to be overly politican in GQ, couldn’t parallels be drawn with the whole Iraq/Halliburton business? ---
**Author:** ![Tuckerfan](https://avatars.discourse-cdn.com/v4/letter/t/eada6e/32.png) [@Tuckerfan](https://boards.straightdope.com/u/Tuckerfan)\ **Post date:** [August 11, 2004, 12:03am UTC](https://boards.straightdope.com/t/mutinational-corporations-prior-to-ww2/259169/13 "2004-08-11T00:03:21Z")
> [@GorillaMan](#): > > Without wanting to be overly politican in GQ, couldn’t parallels be drawn with the whole Iraq/Halliburton business? I don’t think so. By law, the US gov’t has to contract with an American company, but that corporation is free to subcontract that work out to nearly any other company. But in the case of British Imperial Preference, British owned companies operating within Britain or her colonies got better treatment than foreign owned corporations as far as taxes and government regulations. ---
**Author:** ![jimmmy](https://avatars.discourse-cdn.com/v4/letter/j/73ab20/32.png) [@jimmmy](https://boards.straightdope.com/u/jimmmy)\ **Post date:** [August 11, 2004, 12:05am UTC](https://boards.straightdope.com/t/mutinational-corporations-prior-to-ww2/259169/14 "2004-08-11T00:05:50Z")
I.G. Farben was a German Chemical Company that supplied much of the Zyklon B used in the holocaust. It also happened to be the largest Chemical Company in the World, a true MNC colossus and had several subsidiaries, including one in the U.S. Some of the German Directors of the Company faced charges after the war. Post-War the company was broken up – one company which it was broken into is today’s Bayer which has disputed many times that it had taken part in any war time criminal activity whatsoever, but did agree to pay http://slate.msn.com/id/1005418/ . ---
**Author:** ![Cerowyn](https://avatars.discourse-cdn.com/v4/letter/c/82dd89/32.png) [@Cerowyn](https://boards.straightdope.com/u/Cerowyn)\ **Post date:** [August 11, 2004, 12:32am UTC](https://boards.straightdope.com/t/mutinational-corporations-prior-to-ww2/259169/15 "2004-08-11T00:32:59Z")
> [@Shalmanese](#): > > I think the Dutch East India company is commonly touted as one of the first true MNCs. In chronological order, the Imperial “India” companies were:[ul][_]British East India Company, founded in 1600[_]The Dutch East India Company, founded in 1602[_]The Dutch West India Company, founded in 1621[_]The French East India Company, founded in 1664[\*]The Swedish East India Company, founded in 1731[/ul] ---
**Author:** ![HPL](https://avatars.discourse-cdn.com/v4/letter/h/3da27b/32.png) [@HPL](https://boards.straightdope.com/u/HPL)\ **Post date:** [August 12, 2004, 6:31am UTC](https://boards.straightdope.com/t/mutinational-corporations-prior-to-ww2/259169/16 "2004-08-12T06:31:48Z")
> [@tschild](#): > > Construction is perhaps not the best example for international investment in the 1930s. Multinational companies were more prominent in industries like automobiles or oil. For example, both GM and Ford had large German subsidiaries in the 1930s (GM under the Opel brand - they bought carmaker Adam Opel AG at the end of the 1920s if I recollect correctly). Interesting. The reason I asked is because I’ve been working on a short story and part of it invovles an MI6 agent planted in Germany in just prior to the beginning WW2. As a cover, he is working for a british company that has locations in germany, giving him a legitimate excuse to make trips back and forth, as well as move about the country somewhat. I’ve just been looking for the right company. ---
**Author:** ![UDS](https://avatars.discourse-cdn.com/v4/letter/u/ecae2f/32.png) [@UDS](https://boards.straightdope.com/u/UDS)\ **Post date:** [August 12, 2004, 6:57am UTC](https://boards.straightdope.com/t/mutinational-corporations-prior-to-ww2/259169/17 "2004-08-12T06:57:29Z")
Hmm. You’re obviously looking for a British company with _multiple_ locations in Germany, if he’s going to be moving about. Shipping and marine insurance companies might do, except that they would only have had offices or correspondents in port cities; how would that explain a trip to Munich? A travelling sales representative for, say, an engineering company might be ideal. He visits _other_ companies offices, not his own, but would have ample excuse for travelling widely. But Nazi Germany pursued a policy of economic self-sufficiency which strongly discouraged imports, so I would have thought most British exporters would have focused their efforts, and their sales teams, elsewhere. What about the travel agency, Thomas Cook? They were very well established before the war, and I’d be surprised if they didn’t have branches or agencies in several German cities. ---
**Author:** ![Mops](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/mops/32/16494_2.png) [@Mops](https://boards.straightdope.com/u/Mops)\ **Post date:** [August 12, 2004, 4:30pm UTC](https://boards.straightdope.com/t/mutinational-corporations-prior-to-ww2/259169/18 "2004-08-12T16:30:25Z")
Unilever would be a possible choice. One of my grandfathers was a regional rep for them in the 1930s, making the rounds of shops to introduce new products, take orders (magarine, ice cream, other food) etc. Your agent could make the rounds of these regional reps e.g. to introduce the frozen food line (which the german Unilever site says they started in 1939). The management of Deutsche Unilever was German, though, so could not be in the know. ---
**Author:** ![smiling\_bandit](https://avatars.discourse-cdn.com/v4/letter/s/e9a140/32.png) [@smiling\_bandit](https://boards.straightdope.com/u/smiling_bandit)\ **Post date:** [August 13, 2004, 4:27pm UTC](https://boards.straightdope.com/t/mutinational-corporations-prior-to-ww2/259169/19 "2004-08-13T16:27:21Z")
I suppose onecould argue the Knights Templar were the world’s first multinational corp, even if they weren’t exactly set up with the formal rules of tday. ---
**Author:** ![Jake4](https://avatars.discourse-cdn.com/v4/letter/j/bc8723/32.png) [@Jake4](https://boards.straightdope.com/u/Jake4)\ **Post date:** [August 14, 2004, 1:31am UTC](https://boards.straightdope.com/t/mutinational-corporations-prior-to-ww2/259169/20 "2004-08-14T01:31:52Z")
The pharmaceutical company Schering-Plough is a German based company, which had locations in the US before WW1. During both WW1 and WW2, the American holdings were ‘nationalized’. IE, we didn’t let the Germans control what they did. Who woulda thunk it? Opposite to what OP is looking for, but an interesting example anyway.