By some inexplicable fatuity of theirs they are contented and happy if they see the name of a lord or a sir upon the board of directors, no matter whether or not that lord or sir has proved himself to be an unscrupulous rogue. They do not trouble to think that a lord may be as impecunious as any struggling individual without a title, and may jump at the chance of getting a hundred or two as a director of this company, and a hundred or two from other companies, with little or nothing to do for his money. In fact, a title has become in these days an invaluable asset to any man, an asset, however, that is of precious little value to the mining or any other industry. A lord may be well educated, but a good education is not the first nor the sole qualification of a director, especially of a director of a mining company. People do not seem to understand that business knowledge and aptitude, experience, common-sense, acumen, and intelligence, are far more essential, and plain Tom Jones may possess all these qualifications in an eminent degree. But, somehow or other, we turn up our nose at plain Tom Jones, and refuse to entrust the laying out of our capital to him. But let Tom Jones be knighted, or be made a lord for some distinguished service or other, and the man's whole nature and character and mental attributes undergo a magical change in our eyes, and he has but to beckon a finger and we obey it immediately. We would not dream of engaging an assistant in our own business or profession unless he came to us fully qualified, unless he was experienced and had a character above suspicion; but, strange to say, we do not obey these instincts in our public investments, nor take the precautions which are the first we think of in our private life. An impecunious lord may come to us and beg employment, but we would as lief think of putting him in a position of trust and responsibility as we would a tramp out of the street. We may pity his condition, but all we could do would be to offer him some menial position, and bid him be thankful for it. Nor would we have that reverence for him which we seem to have for him in his public capacity, and though we should treat him with respect, we would perhaps look upon him as in some respects inferior to ourselves.
This is a peculiar trait of human nature, and needs penetrative insight and analysis to understand it. Probably the one and only explanation is that we feel vaguely that a lord would not disgrace himself as a public servant, and that the prominent position in which he had placed himself would be a guarantee that he would, at any rate, be an honest man. But many lords have shown themselves to be the most unscrupulous scoundrels unhanged. They have no respect for themselves, and therefore no respect and consideration for other people, their sole concern being self-enrichment and the pursuit of pleasure. Nor have they need to concern themselves much about their public conduct as directors, seeing that, no matter how dishonest they might be, no odium seems to be attached to them, and that they are held in as high estimation as though they had scrupled to conduct themselves as honest, upright men. Neither do they run much risk, even under the new law, of being punished, for though they might deserve it, there is a strange reluctance on the part of shareholders and others to prosecute them. But even should they be honest men, they may still be utterly incompetent, as they commonly are, in fact, and mining companies cannot drift to success, in an aimless way, as most people seem to imagine. They require to be directed by sound intelligence, and if that intelligence is lacking, then it needs no special keenness of vision to foresee the consequences.
Therefore if I were to invest my money in any public company, mining or otherwise, I would take the first instinctive precaution to learn by what kind of men the business was to be administered. I would make sure that they knew something of the business, or the industry, that they engaged capable assistance and advice, and that they were intelligent enough to understand and act upon that advice, and honest enough to work faithfully for the success of the company. If I saw that the board of directors was not composed of such men, I might trouble to read through the prospectus, but it would undoubtedly greatly influence my opinions and direct my judgment, even though the particular business or mine seemed to me to be a promising one. For such men could easily ruin a business, however promising, and easily wreck a mine, however rich it might be. Therefore this is advice which I earnestly impress upon speculators and investors in mining companies, and I hope I shall not tender my advice in vain.
A mine-manager once cabled to his directors to say that a new shaft was urgently needed if the mine was to be properly developed, and he hoped they would give him the necessary approval and money with which to commence the work without delay. Imagine the amazement of that mine-manager when the directors cabled out to him to ask him to try and get a second-hand shaft from somewhere, as they could not afford to buy a new one. And there are many boards equally as ignorant, and these are the kind of men to whom thousands of people will entrust their money. It is astounding! It is fatuity bordering on imbecility. There is no reason and common-sense in it. There is not ordinary child-like gumption in it, and yet when these people reap the consequences of their folly they lay the blame on anybody and anything rather than on themselves.