by John Browne
Jamsetji finally earned government support when he met Lord Hamilton, the Secretary of State for India, in 1900. Now sixty and wealthy, Jamsetji explained to Hamilton that his efforts to develop a steel works were for the improvement of his home country rather than personal profit. Hamilton told him that he would have full government backing. At once, Jamsetji left for the US, where he sought the advice of Julian Kennedy, America’s foremost steel expert and manager at Carnegie’s well-known Edgar Thomson Steel Works. Then he hired a geologist to seek out suitable iron ore reserves, a task he had started almost two decades earlier.
In 1904 Jamsetji Tata died. Of his four great plans for India, only the Taj Mahal Hotel had been completed, built with ten pillars of spun iron that still hold up the ballroom ceiling today. The execution of his vision was continued with equal determination by his sons, Sir Dorabji and Sir Ratanji Tata. Three years later, Dorabji found the perfect site for the Tata steel plant at the small village of Sakchi, which had had a good supply of iron ore, water and sand. Sakchi was later renamed Jamshedpur in honour of Jamsetji. In 1912, the Tatas’ plant produced its first ingot of steel, marking the birth of India’s new iron industry. During the First World War, Tata Steel exported 2,500 kilometres of steel rails, leading Dorabji to comment that if Sir Frederick Upcott had fulfilled his promise to eat every quality steel rail produced he would have suffered ‘some slight indigestion’.66
The Tatas’ first steel mill might never have been built if it had not been for their nationalist vision. Seeking investment for the Sakchi steel mill, the Tatas appealed to their fellow Indians to invest in a project that would help industrialise India. One observer recounts how ‘ … from early morning till late at night, the Tata offices in Bombay were besieged by an eager crowd of native investors. Old and young, rich and poor, men and women they came, offering their mites; and at the end of three weeks, the entire sum required for construction requirements … was secured, every penny contributed by some 8,000 native Indians.’67
At all Tata’s industrial enterprises, the wellbeing of the workers was a priority. Jamsetji introduced humidifiers, fire sprinklers, sanitation disposal and water filtration into his early cotton and textile mills. He was also a pioneer of pension funds, accident compensation and equal rights. Unlike Carnegie, the Tatas did not pursue profits at all other costs; they believed that a business that supports the development of a nation must also support the health and wellbeing of its people. A century before Western business had defined corporate social responsibility, enlightened self-interest and the triple bottom line, he had already got there.68 Tata knew that consideration for society must be integral to every aspect of operations. When shareholders complained of the great expense going into building workers’ accommodation on the site of the Tatas’ first steel mill, Sir Dorabji would tell them: We are not putting up a row of workmen’s huts in Jamshedpur, we are building a city.’69 In 1895 Sir Dorabji wrote: ‘We do not claim to be more unselfish, more generous or more philanthropic than other people. But we think we started on sound and straightforward business principles, considering the interests of the shareholders our own, and the health and welfare of the employees, the sure foundation of our success.’70
There are few more eloquent expressions of the proper relationship between business and society. Even today many businesses have failed to catch up with Tata. Some still follow American economist Milton Friedman’s mantra that ‘the only business of business is business’, and believe they can ignore the external world.71 In doing so, they risk their reputation, their licence to operate and their customers. Today, as the scrutiny of business becomes more intense than ever, and as governments call on business to do more and more beyond their core activity, we would do well to refer to Tata’s example, and to observe the success it became, not only for his dynasty but for India as a whole.
In The Argumentative Indian, Nobel prize-winning economist Amartya Sen considers the role that our sense of identity and social motivation play in the determination of our economic behaviour. ‘Within the limits of feasibility and reasonable returns,’ he writes, ‘there are substantial choices to be made, and in these choices one’s visions and identities could matter.’72 For the Tatas, a nationalist vision of India’s industrial development led them to behave quite differently in their business practices from the American robber barons.
Like Carnegie, Jamsetji Tata also gave money to support the needs of his nation. With the large fortune that Ratanji and Dorabji inherited, they set up philanthropic organisations, with a focus on education, health and founding institutions of national importance. They continue to hold a large shareholding in Tata today. Jamsetji Tata is remembered in India in the same way as Carnegie is remembered in the US. They differ in how they acquired their wealth. Carnegie sought to amass as much wealth as possible, whatever the cost to his workers, so that he would have more to give back to society, while, for the Tatas, their personal wealth and that of India were one and the same. Both used iron to develop the industrial power of a nation, to form the foundations of a long-lasting business and, ultimately, to give back to society.
Their approaches were successful in their own time and place, but neither would be entirely successful today. In the lawless early days of the American industrial revolution, cronyism and corruption were the only ways for a business to survive and grow. Today such behaviour would provoke an immediate and powerful public backlash; a business would not grow or survive. Even the Tatas’ pioneering and enlightened approach to business is not wholly sustainable in today’s business environment. Dorabji’s decision to build ‘a city’, rather than ‘a row of workmen’s huts’, would run contrary to the fundamental business principle of maximising shareholder value.73 Dorabji’s shareholders were the people of India, whereas today shareholders are largely private individuals. In the current business environment, social investment remains a vital aspect of ensuring business sustainability, but there is a need for something more. In the face of growing inequality, philanthropy remains a vital mechanism for redistributing the wealth that individuals acquire through their use of the elements. In Carnegie and the Tatas we find lessons for today.
CARBON
EVERY YEAR, ON THE third Saturday in July, I watch the fireworks of Venice’s Festa del Redentore, the Festival of the Redeemer, illuminate the sky above the church of the same name. With friends I take a gondola into St Mark’s Basin and meander through the festively decorated boats, packed solid save for a narrow passage kept open for gondolas. Even today, the gondola still commands precedence and respect from all other vehicles in the city. We dock close to the old customs house, the Dogana, and admire the magnificent spectacle of lights as they reflect in the still lagoon waters around us.
The Festa del Redentore celebrates the end of the plague that swept through Venice between 1576 and 1577, taking 51,000 Venetian lives, including that of Titian, the great Renaissance painter. Later that year, as the plague subsided, the foundation stone of Il Redentore, the Church of the Most Holy Redeemer, was laid on the island of Giudecca as an act of thanks. A floating bridge was created out of barges between Giudecca and the main island to allow the Doge, the leader of the Republic of Venice, to walk in procession to the church. That tradition is continued to this day, without, of course, the Doge.
Venice grew out of virtually nothing, from a marshy, malarial wasteland to become, by the thirteen century, the prosperous and most recognised commercial centre of the Western world. Few other cities have made more of a contribution to painting, sculpture, architecture and music. The Festa del Redentore is a celebration of the city’s enduring spirit during times of adversity. We watch the rockets shoot skywards and explode in jubilant streams of colour. Atoms of each element flare their characteristic colour: copper blue, strontium red and sodium yellow.1 But the element of essential importance to the light display is carbon. Without it the rockets would never leave the ground.
Carbon is the fuel supply in gunpowder. In ancient Ch
ina, where the first fireworks were invented, honey was the source of carbon; the drier the honey, the greater the carbon content. The explosive mixture was reported to burn hands and faces and even burn down houses. Later, charcoal, made from the carbonisation of firewood, came to be the traditional fuel element of gunpowder.2 Now, as in the first fireworks of the Festa del Redentore centuries ago, carbon is the fuel element that ignites these yearly festivities.
The fabric of which most of Venice is made is threaded through with carbon. The most widely used stone in the city is a form of limestone, calcium carbonate, from Istria, a peninsula which was part of the territories of the Republic. From Istrian stone the great columns, archways and façades of Venice’s historic palazzos were crafted. Both easy to carve and resistant to weathering, this carbonaceous mineral dominates the city. Carbon, too, is intrinsic to the paper and ink on which Venice laid down its monumental artistic and intellectual achievements and is embedded in the wooden ships with which Venice waged war and expanded her mighty Republic.3
The unusual ability of carbon atoms to bind to themselves to form long chains and rings makes carbon one of the most versatile elements.4 Carbon creates the structures off which other elements hang to create the great complexities of the world. Carbon is not only the foundation of the Venetian Republic, but also of all human civilisations and humans themselves. Carbon is the backbone of DNA, the genetic code from which our bodies are built, repaired and replenished. It is the element of life.5
But carbon, in isolation, is mostly useless. Gunpowder would not explode if the fuel consisted purely of carbon, which ignites only at extremely high temperatures. An oxidiser is needed to speed up the burning of the carbon to make the firework go off with a bang. It is the complex mix of carbon and oxygen that fuels the fireworks at the Festa del Redentore each year.6 Context is almost everything for the carbon atom.
There are very few uses for pure carbon. It appears in graphite, from which pencils are made, and in diamonds. It is used for jewellery and drill bits. Graphene, a pure carbon lattice which is just one atom thick, could soon revolutionise many high-technology industries.7 But overwhelmingly carbon needs other elements to make a difference to the world.
An outbreak of the plague was one of the first nails in the coffin of the Venetian Republic as it began to decline in the sixteenth century. In May 1797, the Republic came to an end when Napoleon Bonaparte’s troops surrounded the lagoon entrance. The Great Council of Venice had little choice but to surrender. With Zen-like calm, the Doge removed his ducal ‘corno’ and passed his white linen cap to his valet, saying simply: ‘Take it, I shall not be needing it again.’8
After the Republic fell, the city reinvented itself by turning to a trade of a very different kind: becoming an attraction for more and more visitors. Now, throughout the summer the historic walkways and squares are packed with tourists of all nationalities who come to marvel at Venice’s cultural legacy. Despite the modernisation of the Venetian economy, the city itself appears much the same as it did when the Republic fell in 1797. The absence of four-wheeled transport gives the impression that modernisation has passed the city by. However, without the constant stream of aeroplanes landing at Marco Polo airport, or the cars and buses crossing the Ponte della Libertà, the economy would collapse. Much like in the fireworks exploding above the Church of the Most Holy Redeemer, carbon now fuels the economy in the form of hydrocarbons used for transport.9
Of all carbon’s combinations, hydrocarbons are the most world-changing. Hydrocarbons are a variety of molecules which are made from the elements hydrogen and carbon. Generally, when they are mixed with oxygen from the air and a spark is added, heat is released. This exothermic reaction, with enough oxygen, also releases carbon dioxide and water vapour.10 In the form of fossil fuels – coal, oil and gas – carbon has granted us simple and abundant energy sources with which to shape the world. The rapid improvement in living conditions and growth in global population seen over the centuries since the Industrial Revolution could not have happened without these fuels. They are the focus of carbon’s story.
I begin with coal, the use of which exploded during the Industrial Revolution and placed societies on the road to global economic growth. Then comes oil, first pumped from wells at the end of the nineteenth century and used as a cheap, bright and clean source of illumination that extended the time available for both work and leisure. However, it was in combination with the automobile that oil really changed the world. The automobile gives people the freedom to go where they want, when they want. And beyond that, oil powers the global network of trucks, ships and aeroplanes that transport cargo and passengers and ensure the functioning of our modern society. And finally natural gas, the most volatile of fossil fuels, which for millennia humanity has simply regarded as waste as it was too difficult to use. Now it has found a powerful purpose in electricity generation and is capable of being moved from where it is produced to where it is needed. The end of my story of carbon tackles an important question: are coal, oil and gas, though of great benefit, the stuff which through our enormous consumption will create catastrophic consequences for humankind?
I first began to understand the dramatic ability of hydrocarbons to shape the world in the 1950s as a child living near the Masjid-i-Suleiman oilfields in Iran. My father worked for the Anglo-Iranian Oil Company (later BP), and he would often take me out to visit the oilfields with their ‘flares’ burning what was then useless natural gas. The intense heat, noise and sulphurous fumes were overpowering. At the age of ten, I remember being taken to the site of Naft Safid Rig 20, a well which spectacularly caught on fire years earlier. The well exploded, spewing hundreds of metres of pipe into the air. The pipe lay where it landed all around the well head. I also vividly remember watching the orange glow of the blowout of the Ahvaz No. 6 oil well burning fifty miles from our house. I was enthralled by the sheer power of oil.
My interest in the oil industry would remain with me for the rest of my life, leading me to join BP in 1966. At BP I tackled the technological and political challenges of oil extraction. I navigated through unstable political terrain of Russia and Colombia, facing oligarchs, drug barons and guerrilla fighters. I saw how, in the struggle for access and control of this highly valued resource, oil brings out the greed and malign spirit of powerful leaders. It occasionally brings out the good. It certainly changed nations who own it and, indeed, it changed the world.
But carbon’s story begins millennia before we began to use oil on an industrial scale. In 1969, I was working in Alaska and there I witnessed a natural phenomenon that led me to reflect on humanity’s earliest use of hydrocarbons. I was a member of a field survey team, taking measurements in the Brooks Range Mountains across which the Trans-Alaska Pipeline runs. During a storm, I watched lightning strike a bituminous outcrop, setting the exposed veins briefly on fire. It is just possible that, thousands of years earlier, early humans saw the same phenomenon and so learnt about the combustible properties of coal.
COAL
Today, by far the largest consumer of coal in the world is China. There is a striking continuity here, for the earliest known use of coal dates from around 4000 BC in the Shen-yang area of north-east China. Pieces of soft, black rock, known as jet or lignite, scattered about the ground were found by early humans and carved into decorative objects, such as beads and ornaments with which to pierce ears. Jet, being easy to carve and polish, was perfect for creating ornaments. It is still used in jewellery today because of its distinct, high-quality finish. The term ‘jet black’ originally comes from this rock.
Coal is the heaviest form of hydrocarbon. It has a smaller proportion of hydrogen to carbon than oil or gas. Therefore it is more difficult to burn and, when burnt, it produces a greater proportion of carbon dioxide than these hydrocarbons.11 Coal comes in different forms; the more hydrogen it contains, the easier it is to ignite. The early inhabitants of China probably saw coal ignited by lightning, or perhaps by the sparks from a firepla
ce, and then realised that they could use it as a source of heat and light.
By the time of the Han Dynasty, beginning around 200 BC, coal was being used on a large scale for both domestic and industrial purposes. It is not surprising that humanity’s first use of coal was in China. Small deposits are found in every province, while the world’s largest coal deposit is in the north, centred on the province of Shansi.
When timber, the traditional and most easily accessible fuel, became scarce during the eleventh century, the use of coal expanded dramatically, mostly in the growing iron industries in China. At this very point in history, China became the centre of innovation for the world. It invented gunpowder, the compass, paper and the printing press, the so-called Four Great Inventions.12 These took many centuries to reach the West.
Putting to use the energy inherent in hydrocarbons, China established itself as the world’s leading power. At that time, China seemed to be on the verge of an industrial revolution, but soon after its boom in innovation its coal consumption slowed and its development relative to the West faltered. This led to the ‘Great Divergence’, the term given to the increasing split between the West’s and East’s power and wealth through the later centuries of the last millennium.
Why did this happen? Was it simply due to differences in geography and geology? Or were the differences cultural, China emphasising the group over the individual? It is one question Joseph Needham set out to answer in his great work Science and Civilisation in China.13 I like to think that it was at least in part about access to energy, and that contains a lesson for today. Whatever the answer, Needham writes: ‘By 1900 China was out of the race, and Western industry dominated the world.’14
Meanwhile, Great Britain, one of China’s chief competitors, was using its own source of abundant coal to fuel the world’s first Industrial Revolution.