Elite directors, London finance and British overseas expansion: Victorian railway networks, 1860-1900

December 7, 2020 | Blog
Home > Elite directors, London finance and British overseas expansion: Victorian railway networks, 1860-1900

The full article from this blog was published on The Economic History Review, and is currently available on Early View at this link


By Shima Amini and Steven Toms (University of Leeds)


Research suggests that appointments of the social elite to the boards of quoted British companies in the late nineteenth century did little to impress the financial markets. Using a dats-set of London-listed international railway companies, our paper shows that elite directors played more than a neutral, or ornamental role, and provided resources, expertise, and connections crucial to the establishment and development of their businesses.

In the second half of the nineteenth century, the City of London financed railway network development in Britain, the Empire, and internationally.  Reflecting this diversity, we contrast elite board membership of railway companies  quoted on the London Stock Exchange, who operated  in Britain, India, and Argentina.

We constructed a dataset of individual directors serving on the boards of railway companies and used social network analysis and exact logistic regression to map and explain the characteristics of networks of elite directors in each of the three countries.

The paper demonstrates how social network analysis can be used not just to map networks and identify significant individuals, but also to identify the most influential groups. Consequently, we could determine which subsections of the elite — aristocrats, military, politicians or financiers —  were dominant in each location.

Our results reveal that, by 1895, aristocratic directors were prominent in Britain, military directors in India, and financier directors in Argentina (Table 01). We used a ‘group exchange’ score at two census dates, 1869 and 1895, to identify the first and second most dominant group and the most dominant non-elite category for each network.[i]


Table 01 – Dominant groups in a sample of London-quoted railway companies. Source: as per article

Year Country of operation Dominant groups    (Group exchange score)
    Elite 1st Elite 2nd Highest non-elite
1869 Britain Politician (0.220) Financier (0.207)




India Military


Politician (0.187) Government official


Argentina Politician (0.367) Financier (0.167) Engineer



1895 Britain Aristocrat







India Military





Government official


Argentina Financier







In each country, board appointments from dominant groups reflected their local knowledge, resource access, and network connections. As the dominant group in Britain, aristocrats, including hereditary peers, used their connections to the political system to assist their companies. Influential aristocrats involved in railway promotion during the 1890s, were politicians or regional industrialists in their earlier careers. A leading example was Sir Edward William Watkin.

Military and career civil servants dominated the boards of Indian railway companies. They helped develop the Indian railway system to secure strategic control of India as an Imperial asset and  to suppress quickly local rebellions. Commercial traffic was often a secondary consideration.  Over time, military and Indian government official figures serving on the boards of railways achieved promotion to a newly created aristocratic order featuring the Order of the Star of India and the Order of the Indian Empire. Examples include Lieutenant-General Craven Hildesley Dickens, Secretary to the Government of India Public Works Department, and Robert Barclay Chapman, Companion of the Star of India of the Bengal Civil Service and former Financial Secretary to the government of India.

In Argentina, financiers were the dominant elite group, based on the pre-established connections of merchants in the Buenos Aires trade. Their networks subsequently featured lawyers, who were often also British Members of Parliament. In combination, these investment groups effectively negotiated concessions with regional and national governments, facilitating railway development in Argentina, including the ambitious Transandine railway (Figure 01), and associated cash flows for London investors. Gabriel Goldney MP, and director of Capital and Counties Bank, along with Edward Norman of Martins Bank, led one of several influential networks.

Figure 01. Route of the Transandine Railway. Source: Wikimedia Commons

Our analysis of the boards of railway companies contributes to the broader debate on gentlemanly capitalism, the economic characteristics of British overseas economic expansion, and the role of elite directors. [ii]  Elite directors on the board of railway companies reflected expertise required by the international location of investment, inside and outside the British Empire, including their ability to access human, social, and financial capital, and their ability to access and lobby governments. British economic expansion in the nineteenth century also provides a useful contextual testbed of these relationships as a contribution to the corporate governance literature, given the heterogeneity of elites and their greater categorical distinctiveness, compared to more recent datasets.[iii]


To contact the authors:

Shima Amini: s.amini@leeds.ac.uk, @Shima_Amini2020

Steven Toms: j.s.toms@leeds.ac.uk




[i] The group exchange score is defined as the number of reciprocal ties connected to one group divided by the total number of reciprocal ties in the network.

[ii] Cain, P. J., and Hopkins, A. G., British imperialism: 1688-2000, (Routledge, 2014).

[iii]According to data accessed via Creditsafe, featuring directors of all present day Companies House registered companies, < 1% had readily identified elite titles.