THE COMMITTEE
Just as the interests of the proprietors of the Stock Exchange are in
the hands of a body of Trustees and Managers, so are the interests of
the members under the control of a Committee, which is called the
Committee for General Purposes. The Managers provide and maintain the
market-place, and thus make profit on the proprietors' capital; the
Committee presides over the dealings in the market, and, of course,
makes no profit in any way. It consists of thirty members, elected by
ballot annually. Sometimes the election is exciting, when, for instance,
the policy of the Committee on any point is questioned, but more usually
it is a very formal affair. But exciting or formal, a few of the
ballot-papers handed in by the members are, strange to say, always
spoilt. The member of the Stock Exchange is prone to give vent to his
feeling of admiration or indignation for the benefit of the scrutineers
even at the expense of losing his votes altogether.
To be eligible for the office of Committeeman, one must have been a
member for at least five years. The office is and always has been
honorary, but now and again it is suggested that the Committee should
consist, at least partly, of paid experts. Its duties are arduous, and
it frequently has to settle points of the most delicate nature, whereas
it is frequently complained that it does not consist of the best or most
experienced members of the Stock Exchange, who do not see in the honour
and dignity of the position sufficient inducement for the sacrifice of
the time its duties involve. However, generally speaking, the members
are held in high esteem, and seldom, indeed, does it occur that there is
even an expression of disloyalty to the dictates of the Committee even
on the part of those who most desire its reform.
It is questionable whether throughout the whole world any body of men so
constituted is endowed with more important functions or with more
arbitrary power. The Committee can make practically any additions to or
alterations in the code of rules, which was originally based on the deed
of settlement of the Stock Exchange. Those rules have become more
drastic than the law of the land. Practices which would be perfectly
legal, although not very reputable, constitute a contravention of the
rules of the Stock Exchange which would bring dire consequences upon any
member who indulged in them. Members have been expelled the House by the
Committee under the rules for an offence of which the law of the land
would not take cognisance. The rules of the Stock Exchange, as
administered by the Committee, are a code of honour rather than a code
of law.
In the course of administering this code of honour the duties of the
Committee become exceedingly varied. It holds an ordinary meeting every
Monday, but special meetings may be called at an hour's notice, only
seven members out of the thirty being required to form a quorum in the
ordinary way. Its fiat may go forth censuring, suspending, or expelling
a member--expulsion, of course, meaning the loss of his profession,
practically the end of his career, and probably ruin. Or its fiat may go
forth in mild protest against smoking in the House a few minutes before
the regulation time, or, as the temptations of the 5th of November
approach, appealing to members to desist from firework displays in the
House. With the Committee, of course, rest the admission and re-election
of members. It decides whether the House shall be closed on any day
except the usual holidays--there is always the excuse of structural
alterations, and, as everyone knows, building operations can be carried
on much more readily on a fine summer Saturday than during the dark
frosts of winter. It decides all disputes between members; arbitration
amongst the members themselves is encouraged, but they frequently refer
to the Committee as a last resort. From its decision there is no appeal.
To have recourse to the law courts without the permission of the
Committee--which is, of course, granted in special cases--probably means
the loss of membership by the member, who at the very outset undertakes
to submit absolutely to the Committee and its rules. The Committee may
summon any member before it and demand information; its power is
inquisitorial. It fixes the days of settlement of the various
transactions which take place in the market, and it decides what stocks
or shares shall or shall not be quoted in the Official Price List, which
emanates daily from the Stock Exchange under the Committee's
superintendence. The principal officers of the Stock Exchange
responsible to the Committee are its Secretary, the Secretary of the
Share and Loan Department, the Official Assignee, the Deputy Official
Assignee, the Manager of the Settlement Department, and the Manager of
the Buying-In and Selling-Out Department. The nature of their duties
will become clear as we proceed.
Thus it will be seen the Stock Exchange is governed under a system of
dual control--that of the Managers representing the proprietors on the
one hand, and that of the Committee representing the members on the
other. It is the system of a proprietary club. In its efforts for the
good order and government of the House, the Committee has no funds that
it can expend. It may make representation to the Managers, but it can do
no more; although there is every sign that the Managers are always
reasonably willing to accede to these representations. At the time of
the imposition upon unauthorised clerks of those badges of which mention
has been made, there was much delay in issuing them, and the story went
round that whilst the Committee had declared their necessity, the
Managers refused to advance the money to provide them. That was probably
merely a playful little suggestion, but it serves as an illustration of
the drawbacks of dual control. This dual control is, however, gradually
becoming abolished under the operation of the rule which compels every
new member to hold one or more shares in the Stock Exchange.