Splitting Besshi and the Shisakajima smelter out of the family’s direct operation (1927)

From what a house holds to what an account holds

To call the end of 236 years of direct operation merely a step in modernization is not enough. Sumitomo’s 1882 house code recorded Besshi as an “imperishable capital asset,” and until around the Sino-Japanese War the house’s business was almost nothing but Besshi. In 1927 Sumitomo Goshi took that same Besshi out of its own direct hands and turned it into the assets of a single company, priced at ¥15 million of capital. The core of the decision lies exactly there: what had been held in the name of the house was moved into the name and the accounts of a corporation.

Incorporation did not, however, make Besshi stronger. Domestic copper output had fallen to 54,000 tonnes by 1922, and the number of working mines had halved by 1929. The smoke-damage compensation ran on until the neutralization plant was completed in 1939, and the new company took over the business with that liability attached. Besshi was exhausted in 1973; what remained was the company. The business ends and the corporation continues — that order of precedence is what Sumitomo Goshi chose in 1927.