National Cultures and International Competition: the Experience of Schering AG, 1851-1950.
Lewis, Jeffrey
National Cultures and International Competition: The Experience of
Schering AG, 1851-1950, by Christopher Kobrak. Cambridge Studies in the
Emergence of Global Enterprise. Cambridge, Cambridge University Press,
2002. xvii, 394 pp. $50.00 US (cloth).
National Cultures and International Competition: The Experience of
Schering AG, 1851-1950, by Christopher Kobrak is a
thoroughly-researched, crisply-written history of one of Germany's
most enduring pharmaceutical firms. While the book's subtitle would
lead one to expect a century's worth of history, in fact the work
is much more focused on the early twentieth century, as Kobrak readily
admits. Roughly three-quarters of the book is devoted to the time
between 1913 and 1945, and during this time Schering makes for an
interesting case study because its corporate strategy differed markedly
from the more common model of German "cooperative capitalism"
that favored stability and close government/business relations over
markets. Schering, in contrast, chose to pursue innovative products that
could compete in international markets, although the firm certainly did
not remain outside the system of cartels that dominated German business
in the early twentieth century.
This tension between Schering's corporate strategy and the
broader political climate of Germany is the main theme of the book, and
Kobrak convincingly demonstrates that when Schering compromised its
international business presence to accommodate German national concerns,
the result was usually detrimental for the firm. Schering's first
major commercial success, coming in the early twentieth century, was the
production of synthetic camphor, which won it a wide international
market. Schering suffered from the effects of World War I, both by
losing markets abroad and by the inability to import raw materials.
War-related contracts with the German government temporarily offset
these losses, but were of little long-term commercial significance.
After the war, Schering was purchased by a coking firm, Kokswerke, as
part of a broader wave of consolidation. Schering recovered fairly well
from the damages of the war and inflation, and was successful in
recovering patents and other property that had been seized by the
Allies. In the early stages of the Depression, Schering managed to
remain profitable and even pay a dividend because its main products,
pharmaceuticals and film, maintained high export levels. Schering's
investment and specialization in these areas had built up a network of
trust with foreign customers. Thus Schering depended on a fragile
internationalism as the Nazis took power in 1933; Schering would soon
end up sacrificing this profitable internationalism to the autarky of
the National Socialist government.
When his story enters the 1930s, Kobrak self-consciously steps away
from the internal workings of the firm to focus on its interactions with
the Nazi government. This relationship was anything but smooth.
Schering's business practice contradicted the Nazi strategy of
autarky and none of its top executives were members of the party prior
to Hitler's appointment as chancellor. Still, the firm publicly
supported the Nazi government in a futile effort to remain independent.
Although the firm tried to protect Jewish executives early on, by the
late 1930s Aryanization was in full swing at Schering. The war years
also saw the widespread use of slave labour by both Schering and
Kokswerke. Most importantly, Kobrak notes how Schering's leaders
rationalized their complicity during and after the war. Because they had
not supported the regime at an early stage and because their firm had
not profited from its association with Nazism, they interpreted Nazism
and the war as an unfortunate occurrence for which they bore no
responsibility. They expressed no regrets about the use of slave labour
by their firms.
Kobrak's ongoing critique of the "cooperative
capitalism" that dominated the thinking of most German business
executives in the last century is likely to be the most important
finding of this study for the business history community. However, the
fact that a firm whose policies differed dramatically from those of the
Nazi government readily became complicit in autarky and even the
unapologetic use of slave labour, seems to me to be an equally
significant finding. Unfortunately, just as Kobrak begins to explore
this topic, he wraps his account up all too quickly. The entire postwar
era receives very scant attention, merely a seventeen-page epilogue,
which is a shame, for it is here that Kobrak's work could be of
great significance to readers outside the field of business history.
There is much in common between the behavior of Schering's
executives and other groups who supported Nazism without embracing it
fully and then used this ambivalence to rationalize their behaviour
after the war. Thus the example of Schering has the potential to
contribute significantly to a growing literature on the early years of
the Federal Republic of Germany. Since Kobrak's stated goal was to
produce a business history that is of relevance to a broader community
of scholars, it seems to me he has missed an opportunity here to make
his good book even better.
Jeffrey Lewis
Ohio State University
