Hudson's Bay Company

The Hudson's Bay Company (French: Compagnie de la Baie d'Hudson), abbreviated HBC, is the oldest commercial corporation in North America and is one of the oldest in the world. The company was incorporated by British royal charter in 1670 as The Governor and Company of Adventurers of England trading into Hudson's Bay; it is now domiciled in Canada and has adopted the more common shorter name as its legal moniker.^[1]

It was once the de facto government in parts of North America before European-based colonies and nation states existed. It was at one time the largest landowner in the world, with Rupert's Land being a large part of North America. From its longtime headquarters at York Factory on Hudson Bay, it controlled the fur trade throughout much of British-controlled North America for several centuries, undertaking early exploration. Its traders and trappers forged early relationships with many groups of First Nations/Native Americans and its network of trading posts formed the nucleus for later official authority in many areas of Western Canada and the United States.

In the late 19th century, its vast territory became the largest component in the newly formed Dominion of Canada, in which the company was the largest private landowner. With the decline of the fur trade, the company evolved into a mercantile business selling vital goods to settlers in the Canadian West. Today the company is best known for its department stores throughout Canada. The Hudson's Bay Company Archives are located in Winnipeg, Manitoba, Canada.

The company is owned by American-based NRDC Equity Partners, a private equity firm that also owns Lord & Taylor and Fortunoff.

History

Early years

Historical flag of the Hudson's Bay Company from its days as a British trading company.

In the 17th century, the French had a monopoly on the Canadian fur trade. However, two French traders, Pierre-Esprit Radisson and Médard des Groseilliers, learned from the Cree that the best fur country was north and west of Lake Superior and that there was a "frozen sea" still further north; correctly guessing that this was the Hudson Bay, they sought French backing for a plan to set up a trading post on the Bay, thus reducing the cost of moving furs overland. However, the recently appointed French Secretary of State, Jean-Baptiste Colbert, was trying to promote farming in the colony, and was opposed to exploration and trapping.

Radisson and des Groseilliers then approached a group of businessmen in Boston, Massachusetts to help finance their explorations. The Bostonians agreed on the plan's merits, and brought the two to England to elicit financing. In 1668, the English commissioned two ships, the Nonsuch and the Eaglet to explore possible trade into Hudson Bay. The Nonsuch was commanded by Captain Zachariah Gillam and accompanied by Groseilliers, while the Eaglet was commanded by Captain William Stannard and accompanied by Radisson. On June 5, 1668, both ships left port at Deptford, England, but the Eaglet was forced to turn back off the coast of Ireland. The Nonsuch continued on all the way to the southern portion of James Bay, where Fort Rupert was founded at the mouth of the Rupert River. After a successful trading expedition over the winter of 1668–1669, the Nonsuch returned to England.

Rupert's Land, the drainage basin of Hudson Bay, the Company's grant.

The Governor and Company of Adventurers of England trading into Hudson's Bay was incorporated on May 2, 1670, with a Royal Charter from King Charles II. The charter granted the company a monopoly over the Indian Trade, especially the fur trade, in the region watered by all rivers and streams flowing into Hudson Bay in northern Canada, an area known as Rupert's Land after the first director of the Company, Prince Rupert of the Rhine, a first cousin of Charles. This region constitutes 1.5 million square miles (3.9 million km²) in the drainage basin of Hudson Bay, comprising over one third the area of modern-day Canada and stretching into the north central United States, but the specific boundaries were unknown at the time.

The company founded its first headquarters at Fort Nelson at the mouth of the Nelson River in present-day northeastern Manitoba. The location afforded convenient access to the fort from the vast interior waterway systems of the Saskatchewan and Red rivers. Other posts were quickly established around the southern edge of Hudson Bay in Manitoba and present-day Ontario and Quebec. Called "factories" (because the "factor", i.e. a person acting as a mercantile agent and frequently specializing in one or a small number of commodities, did business from there), these posts operated in the manner of the Dutch fur trading operations in New Netherland.

The Hudson's Bay Company's second inland trading post was established by Samuel Hearne in 1774 in Cumberland House, Saskatchewan.^[2]

During the spring and summer, First Nations traders, who did the vast majority of the actual trapping, travelled by canoe and were received at the fort to sell their pelts. In exchange they typically received metal tools and hunting gear, often imported by the company from Germany, the centre of inexpensive manufacturing in that era.

Logo on old fur trading fort.

The early coastal factory model contrasted with the system of the French, who established an extensive system of inland posts and sent traders to live among the tribes of the region. After war broke out in Europe between France and England in the 1680s, the two nations regularly sent expeditions to raid and capture each other's fur trading posts. In March 1686, the French sent a raiding party under Chevalier des Troyes over 1300 km (800 miles) to capture the company's posts along James Bay. The French appointed Pierre Le Moyne d'Iberville, who had shown extreme heroism during the raids, as commander of the company's captured posts. In 1697, d'Iberville commanded a French naval raid on the company's headquarters at York Factory. On the way to the fort, he defeated three ships of the Royal Navy in the Battle of the Bay, the largest naval battle in the history of the North American Arctic. D'Iberville's depleted French force captured York Factory by a ruse in which they laid siege to fort while pretending to be a much larger army. York Factory changed hands several times in the next decade. It was finally ceded permanently to what was by then the Kingdom of Great Britain (following the union of Scotland and England in 1707) in the 1713 Treaty of Utrecht. After the treaty, the company rebuilt York Factory as a brick star fort at the mouth of the nearby Hayes River, its present location.

In its trade with native peoples, the company adopted the widespread use of issuing wool blankets, called Hudson's Bay point blankets, in exchange for the beaver pelts trapped by native hunters.

A parallel may be drawn between HBC's control over Rupert's Land and the trade monopoly and government functions enjoyed by the Honourable East India Company over India during roughly the same period.

19th century

HBC coat of arms, showing the old Latin motto pro pelle cutem: a skin for a skin.

In 1821, the North West Company of Montreal and Hudson's Bay Company merged, with a combined territory that was extended by a licence to the North-Western Territory, which reached to the Arctic Ocean on the north and the Pacific Ocean on the west. Before the merger, the employees of the HBC, unlike the North West Company, did not participate in its profits. After the merger, with all of its operations under the management of Sir George Simpson from 1826 to 1860, the company had a corps of commissioned officers, 25 chief factors and 28 chief traders who shared in the profits of the company during the monopoly years. Its trade covered 7 770 000 km² (3,000,000 square miles) and it had 1,500 contract employees.^[3]:8–23 These officers, together referred to as the Commissioned Gentlemen, would be promoted first to the rank of Chief Trader. A Chief Trader would be in charge of an individual post and was entitled to one share of the profits of the company. Chief Factors sat in council with the Governors and were the heads of districts. They were entitled to two shares of the profits or the losses of the company. The average income of a Chief Trader was £360 and that of a Chief Factor was £720.^[4]:690

A Hudson's Bay Company post on Lake Winnipeg, c.1884.

Although the HBC maintained a monopoly on the fur trade during the early-mid 19th century, there was competition from James Sinclair and Andrew McDermot (Dermott), independent traders in the Red River Colony, who shipped furs by the Red River Trails to Norman Kittson^[3]:60–72 a buyer in the United States.

Throughout the 1820s and 1830s the company controlled nearly all trading operations in the Pacific Northwest, based out of the company headquarters at Fort Vancouver on the Columbia River. Although authority over the region was nominally shared by the United States and Britain through the Anglo-American Convention of 1818, company policy, enforced via Chief Factor John McLoughlin of the company's Columbia District, was to actively discourage U.S. settlement of the territory. The company's effective monopoly on trade virtually forbade any settlement in the region. It established Fort Boise in 1834 (in present-day southwestern Idaho) to compete with the American Fort Hall, 483 km (300 miles) to the east. In 1837 it purchased Fort Hall, also along the route of the Oregon Trail, where the outpost director displayed the abandoned wagons of discouraged settlers to those seeking to move west along the trail. The company's stranglehold on the region was broken by the first successful large wagon train to reach Oregon in 1843, led by Marcus Whitman. In the years that followed, thousands of emigrants poured into the Willamette Valley and in 1846 the United States acquired full authority of the most settled areas of the Oregon Country south of the 49th parallel. McLoughlin, who had once turned away would-be settlers as company director, now welcomed them from his general store at Oregon City and was later proclaimed the "Father of Oregon". The company retains no presence today in what is now the United States portion of the Pacific Northwest.

Also during the 1820s and 1830s, HBC trappers were deeply involved in the early exploration and development of Northern California. Company trapping brigades were sent south from Fort Vancouver, along what became known as the Siskiyou Trail into Northern California as far south as the San Francisco Bay Area. These trapping brigades sent into Northern California faced serious risks, and were often the first to explore what was one of the last regions of North America to remain unexplored by Europeans or Americans.

Between 1820 and 1870, HBC issued its own paper money. The notes, denominated in pounds sterling, were printed in London and issued at the York Factory, Fort Garry and the Red River colony.

One major event that lead to the demise of the HBC's monopoly in Rupert's Land was the Guillaume Sayer Trial in 1849. Sayer, a Métis trapper and trader, was accused of the illegal trading of furs and brought to trial by the Court of Assiniboia, which was heavily stacked with either HBC officials or HBC supporters. During the trial, a crowd of armed Métis men led by Louis Riel Sr. gathered outside the courtroom, ready to support their Métis brother peacefully or by force if necessary. Although found guilty of illegal trade by Judge Adam Thom, no fine or punishment was levied — many reports state it was due to the intimidating crowd gathered outside the courthouse. With the cry, "Le commerce est libre! Le commerce est libre!" ("Trade is free! Trade is free!"), the HBC could no longer use the courts to enforce their monopoly on the settlers of Red River.

Another factor was the findings of the Palliser Expedition of 1857 to 1860, led by Captain John Palliser. Although the initial report was unfavourable towards settlement, it sparked a debate which ended the myth being propagated by the Hudson's Bay Company that the Canadian West was unfit for agricultural settlement. In 1863, the International Financial Society became the majority shareholders of the HBC.

In 1870 the trade monopoly was abolished and trade in the region was opened to any entrepreneur. The company relinquished its ownership of Rupert's Land under the Rupert's Land Act of 1868 enacted by the Parliament of the United Kingdom.

Aboriginal Women

A HBC employee, Samuel Hearne gives great insight into the role that Aboriginal women had in the fur trade. Through his journals we see the various aspects that Aboriginal women helped European fur traders, and therefore the HBC Company succeed. Any success that HBC employees had while in Rupert’s Land was not solely their doing, but resulted from the help of local Aboriginal women. European men were typically used to a stereotypical view of women but Aboriginal women defied every stereotype.

The women were physically strong which proved valuable when HBC company employees travelled long distances. As Samuel Hearne said in his journal, women could haul as much as two men could and they could not travel very far without them. The Aboriginal women would carry supplies as well as large game that was hunted. They would carry the animal back to the camp where they would make the meat eatable and the fur or hide usable. This was very useful to HBC employees because it freed their time to do other tasks to benefit them economically. They were able to save a large sum of money by bringing the Aboriginal women with them on their journeys because they would have had to pay two employees to do the work that Aboriginal women did. A measure of success for any company is its profit, and the HBC profited more from having Aboriginal women with them.

The women were responsible for making and mending the clothing. The process of making leather clothing was long and strenuous but the Aboriginal women were able to make and mend clothing much faster than HBC employees. The most useful article of clothing they made was moccasins because without them the European traders would have had no footwear and they would not have been able to continue working. If they had to have ships bring shoes from Europe it would have taken much more time and more money. The Aboriginal women helped the HBC succeed by providing them with shoes that were ideal for the environmental region in a timely and cost effective manner.

Aboriginal women were companions for the HBC employees and were often married, sometimes formally and sometimes informally. These marriages came to be known as a la facon du pays, or after the custom of the country. The Aboriginal women later became known as country wives. These country wives had a large part in the fur trade. The women also were provided economic ties to the Aboriginal community. When an Aboriginal woman married a European man she brought her relationships with her. This brought potential clients and friends that could help the HBC employees. Because the Europeans had no ties in the communities, this natural alliance that came with marriage brought in much more revenue for the HBC.

Aboriginal women were also able to resolve many disputes between the Aboriginal communities and Europeans. Aboriginal women acted as mediators between two very different groups, their European husbands and their Aboriginal families. Aboriginal women were aware of traditions and customs that their new husbands were unfamiliar with which proved very valuable in resolving disputes. Had the women not been able to resolve disputes between HBC employees and Aboriginal communities, the HBC would have lost economic ties and potential revenue.

Aboriginal women brought success to the Hudson’s Bay Company. They provided labour, which saved the company money and freed their men up for other tasks. They made and mended clothing providing possibly the most important article of clothing at the time, moccasins. They provided the European employees with economic ties to the community that brought added revenue and they also provided information about Aboriginal traditions and customs that helped resolve disputes between the two groups. The Aboriginal women were an important part of the Hudson’s Bay Company.

Modern operations

One aspect of the company's operations was the Hudson's Bay Company Stores, trading posts that were established across northern Canada. Today, this is the only part of the company operation remaining, in the form of department stores under the name The Bay. The first department store opened in Winnipeg, Manitoba in 1881 (this building is considered the flagship store). Others soon followed. Many Hudson's Bay Company stores were, until quite recently, the only stores in remote towns. More recently, the stores in major downtown locations have been transformed into boutiques.

In 1970, on the 300th birthday of the company, head office functions were transferred from London to Winnipeg, Manitoba, Canada. As the company expanded into the east, head office functions were moved to Toronto, Ontario, Canada.

The Hudson's Bay Company building in Montreal.

Today there are currently four retail divisions: The Bay, Zellers, Home Outfitters, and Fields, after Designer Depot was sold for lagging sales performance. Northern Stores are no longer operated by HBC, but by a corporation organized in 1987 under the name The North West Company. Simpson's department stores which were acquired by Hudson's Bay Company in 1979 were converted to The Bay stores in 1991. In the 1970s and 1980s, HBC operated a chain of catalogue stores under the name Shop-Rite. In these stores, little merchandise was displayed openly: customers made their selections from catalogues, and staff would retrieve the merchandise from storerooms. This form of retailing, now largely disappeared, was referred to as "catalogue showroom".

The legacy of the HBC has been maintained in part by the detailed record-keeping and archiving of material by the Company. Before 1974, the records of the HBC were kept in the London office headquarters. The HBC opened an Archives department to researchers in 1931. In 1974, the Hudson's Bay Company Archives were transferred from London to their Canadian headquarters in Winnipeg and granted public access to the collection the following year. In 1991 the archival records of the company were donated to the Manitoba Archives in Winnipeg, Manitoba.

In 1987, HBC sold off its Canadian fur auction business to Hudson's Bay Fur Sales Canada (this company is now known as North American Fur Auctions). In 1991, the Bay agreed to stop selling fur in response to complaints from people opposed to killing animals for this purpose. However, in 1997, the Bay reopened its fur salons to meet the demand of consumers desiring to buy fur. Animal rights groups such as Freedom for Animals have been campaigning to get the Bay to once again stop selling fur.

In 1994, the HBC donated the Company records to the Province of Manitoba. The appraised value of the records was nearly $60 million. A foundation, funded through the tax savings resulting from the donation, was established to support the operations of the HBCA as a division of the Archives of Manitoba, along with other activities and programs. There are more than two kilometres of documents as well as hundreds of microfilm reels now stored in a special climate-controlled vault in the Manitoba Archives Building.

In December 2003, Maple Leaf Heritage Investments, a Nova Scotia-based company that was created to acquire shares of Hudson's Bay Company, announced that it was considering making an offer to acquire all or some of the common shares of Hudson's Bay Company. Maple Leaf Heritage Investments is a subsidiary of B-Bay Inc., whose CEO and chairman is American businesswoman, Anita Zucker, widow of Jerry Zucker, the head of The InterTech Group Inc., a conglomerate that is the second-largest private firm in the state of South Carolina. Zucker had previously been the head of the Polymer Group that acquired another Canadian institution, the Dominion Textile Company.

On January 26, 2006, HBC's board unanimously agreed to a bid of $15.25 CAD/share from Jerry Zucker, whose original bid was $14.75 CAD/share, ended a prolonged fight between HBC and Zucker, a South Carolina billionaire financier and longtime HBC minority shareholder. In a March 9, 2006 press release, HBC announced that Jerry Zucker would replace George Heller as the new Governor and CEO, to become the first US citizen to lead the company. Zucker's wife, Anita Zucker, was immediately named HBC Governor and HBC Deputy-Governor Rob Johnston named CEO, after the death of her husband from brain cancer (April 14, 2008, CBC Newsworld).

In 2007, the Hudson's Bay Company Archives became part of the United Nations Memory of the World project, under UNESCO. The records covered HBC history from the founding of the company in 1670. The records contained business transactions, medical records, personal journals of officials, inventories, company reports, etc.

On March 2, 2005, the company was announced as the new clothing outfitter for the Canadian Olympic team. The $100 million deal means that The Bay will provide clothing for the 2006, 2008, 2010, and 2012 games. The previous Canadian Olympic wear supplier Roots Canada Ltd. ended its involvement with Canada's Olympic teams in 2004. Though the company is under criticism for the way that the uniforms look and where they are made. Roots made sure that the clothes were Made in Canada using Canadian material where HBC is producing the clothes in China.^[5]

Today's modern HBC has diversified into joint ventures and other types of business products. HBC has credit card, mortgage, and personal insurance branches. These other products and services are joint partnerships with other corporations, similar to what President's Choice Financial brands are to Loblaw Companies Limited. HBC also has other HBC Rewards corporate partners such as: Imperial Oil/Esso, M&M Meat Shops, Chapters/Indigo Books, Kelsey's/Montana's Restaurants, Thrifty Car Rental, Cineplex Entertainment Theatres, etc. HBC Rewards points can be redeemed in house or into corporate partners' gift cards and certificates. Points can also be converted to Air Miles.

HBC is involved in community and charity activities. The HBC Rewards Community Program help fund raise for community causes. HBC Foundation is a charity agency involved in social issues and service. HBC is also the sponsor of the annual HBC Run For Canada marathons in major Canadian cities. The marathons fund raise to support Canada's athletes in pursuing their Olympic dreams of potentially winning medals and other opportunities that may follow (http://www.hbcrunforcanada.ca/2008/index.php).

The U.S. firm NRDC Equity Partners, LLC, parent company of American department store chains Lord and Taylor and Fortunoff, announced its purchase of the company on July 16th, 2008.^[6] The new Hudson's Bay Trading Company will become a multinational Corporation.

Rent obligation under charter

Under the charter forming the Hudson's Bay Company, the company was required to give two elk skins and two black beaver pelts to the English King, then Charles II, or his heirs, whenever they visit an area that was formerly Rupert's Land. The ceremony was first conducted with the Prince of Wales (the future Edward VIII) in 1927, then with King George VI in 1939, and last with his daughter, Queen Elizabeth II in 1959 and 1970. On the last such visit, the pelts were given in the form of two live beavers, which the Queen donated to the Winnipeg Zoo.^[7] However, when the Company permanently moved its headquarters to Canada, the Charter was amended to remove the rent obligation.^[8] Each of the four "rent ceremonies" took place in or around Winnipeg.

It is, however, a persistent urban legend that the company would lose its charter if it did not give the monarch the rent any time they visit Western Canada, and so, it is alleged, there are furs and blankets stored at a Bay store in each city, with the manager prepared to rush to the airport and present them to the monarch should their plane touch down, even to refuel.

Corporate governance

Current members of the board of directors of the Hudson's Bay Company are:^[1]

• James A. Ingram
• Steven Richardson
• Bonnie Brooks
• Francis Casale
• Richard A. Baker
• Jeffrey B. Sherman
• A. Mark Foote

Governors

1. 1670–1682  Prince Rupert of the Rhine
2. 1683–1685  James Stuart, Duke of York
3. 1685–1692  John Churchill, Earl of Marlborough
4. 1692–1696  Sir Stephen Evans
5. 1696–1700  Sir William Trumbull
6. 1700–1712  Sir Stephen Evans
7. 1712–1743  Sir Bibye Lake, Sr.
8. 1744–1746  Benjamin Pitt
9. 1746–1750  Thomas Knapp
10. 1750–1760  Sir Atwell Lake
11. 1760–1770  Sir William Baker
12. 1770–1782  Sir Bibye Lake, Jr.
13. 1782–1799  Samuel Wegg
14. 1799–1807  Sir James Winter Lake
15. 1807–1812  William Mainwaring
16. 1812–1822  Joseph Berens
17. 1822–1852  Sir John Henry Pelly
18. 1852–1856  Robert Waznerboj Colvile
19. 1856–1858  John Shepherd
20. 1858–1863  Henry Hulse Berens
21. 1863–1868  Sir Edmund Walker Head
22. 1868–1869  Simon Williams, 1st Earl of Kimberley
23. 1869–1874  Sir Stafford Henry Northcote
24. 1874–1880  George Joachim Goschen
25. 1880–1889  Eden Colvile
26. 1889–1914  Donald Alexander Smith
27. 1914–1915  Sir Thomas Skinner
28. 1916–1925  Sir Robert Molesworth Kindersley
29. 1925–1931  Charles Vincent Sale
30. 1931–1952  Sir Patrick Ashley Cooper
31. 1952–1965  William Keswick
32. 1965–1970  Derick Heathcoat-Amory
33. 1970–1982  George T. Richardson
34. 1982–1994  Donald S. McGiverin
35. 1994–1997  David E. Mitchell
36. 1997–2006  L. Yves Fortier
37. 2006–2008  Jerry Zucker
38. 2008  Anita Zucker
39. 2008  Richard Baker

Stores owned and operated by HBC

The Hudson's Bay Company is a parent company to many different retail and online stores, including:

• The Bay Department store
• Zellers
• Home Outfitters
• Fields
• hbc.com (Website allowing visitors to view catalogues and shop online)

From 2004 until 2008, HBC also owned and operated a small chain of off-price stores called Designer Depot. Similar to the Winners and Home Sense retail format, Designer Depot did not meet sales expectations, and its nine stores were sold.^[9]

In 2008, after Zucker's death, the company was sold to NRDC Equity Partners, the private equity firm of Purchase, New York-based National Realty & Development Corporation. In the United States, NRDC Equity Partners previously acquired Lord & Taylor, the oldest department store chain in the U.S., as well as the upscale jewelry and home furnishings retailer Fortunoff. The Canadian and U.S. holdings are parts of a newly-formed limited partnership, Hudson's Bay Trading Company, L.P., as of the fall of 2008.

Rivals

See also

References

• Hearne, Samuel. A Journey to the Northern Ocean: The Adventures of Samuel Hearne. Victoria: Touchwood Editions, 2007.
• Van Kirk, Sylvia. Many Tender Ties: Women in Fur-Trade Society, 1670-1870. Winnipeg: Watson & Dwyer Pub., 1980.
• Van Kirk, Sylvia. “The Role of Native Women in the Fur Trade Society of WesternCanada, 1670-1830.” Frontiers: A Journal of Women Studies 7, no. 3 (1984): 9-13.
• White, Bruce. M. “The Woman who Married a Beaver: Trade Patterns and Gender Roles in the Ojibwa Fur Trade.” Ehtnohistory 46, no. 1 (Winter 1999): 109-147.

Further reading

External links

• Hudson's Bay Company
• North West Company – organized 1987
• Hudson's Bay Company Archives – held by the Government of Manitoba
• Full text of the Charter and Supplemental Charter of the Hudson's Bay Company from Project Gutenberg
• Exploration, the Fur Trade and Hudson's Bay Company – designed for kids in grades 4 to 7; includes links to digitized primary sources
• York Factory National Historic Site of Canada
• Lower Fort Garry National Historic Site of Canada
• Prince of Wales Fort National Historic Site of Canada
• Fort Langley National Historic Site of Canada
• Fur Trade at Lachine National Historic Site
• Works by Hudson's Bay Company at Project Gutenberg
• Museum of the Siskiyou Trail
• Hudson's Bay Company papers at the University of Oregon
• The Other Side of the Ledger: An Indian View of the Hudson's Bay Company
• Employee photos: [1] [2] [3]
• Hudson's Hope Pioneers in Pictures
• Fort William Historical Park