Institute History

Archives in the City of London record offices, dating back to 1285, assert that 'there shall be no brokers in the City except those who are admitted and sworn before the warden or Mayor and Alderman'. The privilege of a licence to trade was granted to a broker for an annual fee of £5 and his promise to abide by certain rules that would ensure he would behave in an honourable fashion: any misdemeanours were answerable to the Court of Aldermen. This system lasted for an extraordinary six centuries, giving truth to the term 'Honest Broker'.

By the end of the nineteenth century, brokers in the City of London felt that their business was being hampered by the Court of Aldermen and the thirteenth century law was repealed in 1886.  The Baltic Mercantile and Shipping Exchange Ltd (later The Baltic Exchange) exerted its own code of practice, but brokers were not obliged to be members of it and standards of conduct in the profession were not assured.

David Garbutt Pinkney of D G Pinkney & Co, a shipbroker and a member of The Baltic Exchange, was so concerned about increasingly low standards amongst shipbrokers in the first decade of the twentieth century that he suggested that an "Institute of Shipbrokers", should be formed.  A number of shipbrokers and shipowners, all members of The Baltic Exchange and prominent in British society, took up his cause and so the Institute was set up in 1911. Both shipbrokers and ship agents, from London and all the ports around the UK were invited to become members.

The formal objectives for the new Institute were:

• To protect and promote, by co-operation, the general welfare and interest of shipbrokers
• To discuss, consider and report subjects of interest to shipbrokers and to communicate with the Chambers of Commerce and other public bodies
• To promote or oppose legislative and other measures affecting the business of shipbrokers and to consider, originate and support improvement in maritime and commercial law
• To consider all questions affecting the interest of persons engaged in the business of shipbrokers
• To provide better definition and protection to the profession and business of shipbrokers by a system of examination and issue of certificates

It was this last activity - to set standards by examination - that convinced the UK's Privy Council that the Institute was a serious professional body, and deserving of a much coveted Royal Charter.  It was announced, on 21st January 1920, that by 'Special grace and certain knowledge of His Majesty King George V', the Royal Charter had been granted and so the Institute of Shipbrokers became the Institute of Chartered Shipbrokers.

In addition to the conditions applied to the provision of education, the Royal Charter imposed a system of discipline so that any member acting in a discreditable manner would be censured, suspended or even expelled from membership. This is still the case today.

The 1920 Charter had stipulated that members of the Institute must be British born.  This rule was amended in 1947 to British subjects: as a result of the increase in the number of members that this engendered, new branches of the Institute were opened in British territories outside the UK and in Commonwealth countries.

The rapid development in trade and changes in the design and size of ships following the Second World War resulted in far greater specialisation and an increase in liner shipping.  In response to these new market forces, the Institute changed its examination syllabus into a modular system, sub-dividing shipbroking into six 'disciplines': dry cargo chartering; ship operations & management; tanker chartering; ship sale & purchase; liner trades; and port agency.

A growing demand for membership from countries outside the Commonwealth, led to the Privy Council granting a Supplemental Charter in 1984, permitting membership of the Institute to be offered to citizens of any country in the world.

The same Charter also enabled the Institute to offer Company Membership as a new class and this has enhanced the Institute's influence.  It is now represented on a number of government joint consultative committees, including HM Revenue and Customs and the Home Office.  Suitable members of the Institute collect light dues on behalf of Trinity House.

Find out more about the ICS centenary celebrations