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History of the Institute

London in the Middle Ages

Archives in the City of London 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 the promise that he would abide by certain rules to 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 rise to the term 'Honest Broker'.

For late Victorian brokers, however, the licence represented a restriction on the expansion of their trade and there was a swell of opposition to what was described as interference by the Court of Aldermen. An Act of Parliament in 1886 duly repealed the 13th century law and the register of brokers was discontinued from 1888. The Baltic Committee (as it was known till 1900, when it merged with the London Shipping Exchange to form the Baltic Mercantile and Shipping Exchange) exerted its own codes of practice, but although it was advisable in business terms for brokers to be members of this august body, they were not compelled to be so. Shipbrokers, along with brokers for other trades, could have free rein, which did not always bode well for standards of conduct.

The need for a professional body

Without witnesses to relate the conversations that took place among shipbrokers in the restaurants and coffee rooms of the Baltic Exchange and elsewhere, it is not possible to pinpoint the moment when the desire for an institute of shipbrokers took hold. But an early printed paper in the pages of the shipping magazine Fairplay seems to have triggered concerted action for it. In 'Reciprocity and the Shipbroker', printed in Fairplay on 1 September 1910, David Garbutt Pinkney of DG Pinkney & Co, a shipbroker and a member of the Baltic Exchange, observed:

"During my thirty years' active membership of the 'Baltic' I have witnessed, with feelings of dismay, the gradual decadence of the professional shipbroker, owing to circumstances entirely beyond his control. This change is due to two principal causes, namely the bugbear of reciprocity and the lack of any attempt at combination amongst shipbrokers themselves for their protection." He noted there was "hardly a profession which does not have the protection of an Institute or a Society, protecting them not only in regard of remuneration and status but also in the regulation of conditions under which they shall conduct their business."

Pinkney's view was that it would be a boon for a young man to be able to take "a definite course of study prescribed by an 'Institute of Shipbrokers', and ultimately become an Associate or a Fellow of such a corporation."

The reactions to Pinkney's suggestion of an institute were decidedly positive. Percy Harley, a shipbroker who remained committed to the cause of the Institute right through to the 1930s, remarked that "the immensity and importance of the shipbroking trade is so vast that anything to improve the status and calibre of the broker would be a step in the right direction, and since Mr Pinkney's idea is for that end it deserves every attention."

The first meeting

Whether it was a direct result of Pinkney's public stance or of behind-the-scenes discussions, there was an informal meeting on 20 October 1910 at the Baltic Exchange's "large and commodious building" at 24-28 St Mary Axe, which resolved:

That this meeting approves the formation of a Shipbrokers' Institute and that the gentlemen present at this meeting form themselves into a Provisional Committee for the purpose of formulating a scheme and for calling a full meeting of London Shipbrokers to further discuss the question.

A report of the meeting of 23 November 1910 was published in Fairplay on 1 December 1910. The men who attended were well-known and highly respected in their industry:

  • Thomas Devitt (later Sir Thomas Devitt)
  • David Garbutt Pinkney
  • Sir John Ellerman
  • Fenwick Shadforth Watts (later Sir Fenwick Shadforth Watts, President of the Chamber of Shipping UK)
  • HG Kellock
  • Marmaduke Lawther
  • Harry W Preston
  • GA Bromage
  • Mr Pickard

The resolution that "this meeting of London shipbrokers hereby resolves to form an Institute of Shipbrokers" was proposed by chairman Thomas Devitt duly and it was passed by all those present. All the attendees signed the list of those who would be the first to join the new Institute.

A home at the Baltic Exchange

In 1911, James Arbuckle Findlay was asked to become the new Institute's first Honorary Secretary as well as being the Baltic Exchange's Secretary: he was happy to accept and remained in both posts until he retired in 1932. It seems that the Institute's administration was therefore handled from Findlay's office at the Baltic Exchange; in 1926 it took an office of its own in the building, with a clerk in attendance. Findlay was, by many accounts, a tyrannical sort of a chap, with a reputation for scaring young and unseasoned brokers; however, he was also credited with giving the Baltic Exchange prestige and vitality; qualities that he undoubtedly also brought to the new Institute.


The Institute of Shipbrokers received its certificate of incorporation from the government's Board of Trade in 1913. A celebratory inaugural meeting was held in splendid style at London's then famous Cecil Hotel, the place to be seen at the time. Thomas Devitt described the formal objectives of the new Institute at the launch:

To provide for the better definition and protection of the profession or business of shipbroker by a system of examination, and the issue of certificates of the results of the examinations

To protect and promote by co-operation the general welfare and interest of the business of shipbrokers in the United Kingdom

To discuss, consider, and report upon subjects of interest to shipbrokers, and to communicate thereon with Chambers of Commerce and other public bodies

To consider all questions affecting the interests of persons engaged in the business of shipbrokers or on other trades, businesses or commercial interests connected therewith, and to take such action as may be necessary to promote all such interests

There is much room for debate in the definition of a shipbroker's role, given that the work is so varied, changing according to the area of shipping business on which the broker operates and including the chartering as well as sale and purchase of ships. In Devitt's view, "…the shipbroker was born and not made, as he had to possess so many qualifications, and above all had to be a man of action and capable of holding the balance between his clients effectively and intelligently."

The launch

Howard Houlder, a shipbroker with his own firm of the same name, asked to give a full address to mark the Institute's formal launch and declared that the shipbroker must be "diligent and painstaking, and careful in carrying out the instructions of his principal". For him, the formation of the Institute meant that the work of a broker should "be lifted from a mere haphazard trade into the dignity of a profession." Houlder remarked that the skilful broker gives his advice more by suggesting than otherwise, "so that when the decision is arrived at it is due not to the skill of the broker but to the wisdom of the owner who arrives at the decision".

He (they were invariably 'he' in those days) must also know everything about the crops of the world: "the cereal and vegetable crops of every kind that are grown, when and where they are shipped to, the average crops every year, where everything is produced and the markets of the world. He must have a first-class knowledge of geography, and must know the relative specific gravities of the various classes of merchandise, raw material, etc, as well as be in touch with the world's financial position."

The exuberance of the speeches at the formal launch could not belie the seriousness of the Institute's intentions as they were enshrined in a formal Memorandum of Agreement and Articles of Association, dated 1914. In addition to those described by Devitt, the Institute was bound:

To promote or oppose legislation and other measures which would affect the business of shipbrokers

To consider, originate and support improvements in maritime and commercial law

To create a system of examinations and certificates of passes, whilst acknowledging that such certificates were not "by virtue of Statutory or Government sanction but by the authority of the Institute only"

To set up a benevolent fund

To apply for a Royal Charter

After incorporation, the Institute continued to attract the support of very senior figures, and the list of members of the first Council read like a who's who of the time. These people were of great influence not only in shipping circles, but also in the British establishment as a whole and included a plethora of baronets and knights: Thomas Devitt, the first President of the Council, was knighted in 1916. The vice presidents were Lord Inchcape, Lord Cowdray, Sir Owen Philipps (who became Lord Kylsant), Andrew Weir (who became Lord Inverforth), Sir John R Ellerman, Sir Edward Hain, Sir Walter Runciman and Sir Fenwick Shadford Watts. Other vice-presidents - who may not have had titles but were highly regarded and prominent among shipbrokers - were Frank Dixon, Newton Dunn, Howard Houlder and George Paget Walford.

There were 185 Fellows and Associates of the Institute by May 1914, with members coming predominantly from London, but also from Bristol, Cardiff, Cork, Glasgow, Hull, Liverpool, Manchester, Newcastle-on-Tyne, Plymouth, Port Talbot, Sunderland, Swansea and West Hartlepool.

According to the Articles of Association, the Institute office had to be located in the City of London and ordinary general meetings had to be held in London. To be a Fellow (and entitled to use the initials FIS), a person had to have been a principal, a director or a managing clerk for the previous three years in a firm carrying on the shipbroking profession in the UK, or, having passed the examination for the admission as Associate, been engaged in business as described for not less than a year. The requirements for Associate (AIS) membership were that the person must be 21 years of age and working as a clerk to a shipbroker in the UK, and to have passed the Institute's examinations. By 1915, the Articles were amended to allow membership for shipbrokers of British nationality who were living in 'the Colonies' or abroad.

The Articles of Association gave no specific details of what the examinations would include and there is no information about whether any examinations were even set at this stage, which given that the First World War was in progress, is unlikely. Certainly, there is no mention of examination results in the annual Council Reports until 1922. A library was to be set up for the benefit of students.

After World War One

Some twelve years after the First World War, Howard Houlder reflected: "It is not too much to say that had there been no institute then, to formulate and press the shipbrokers' requests for equitable consideration, the attention which was given by the authorities would not have been made to representations made by individuals." Houlder also said that the Institute's efforts during the First World War had the positive result that "many brokers who previously had stood aloof from the Institute became members of it".

It was the aim to provide for better definition and protection of the profession or business of shipbrokers by a system of examination and the issue of certificates which convinced the Privy Council that the Institute was a serious professional body, and so on 21 January 1920 it was announced that "by the special grace and certain knowledge of His Majesty King George V" it was incorporated by Royal Charter and would henceforth be known as the Institute of Chartered Shipbrokers.

The president in that momentous year was William Joseph Noble and his collection of vice-presidents read like pages from Burke's Peerage: Lord Cowdray, Sir John R Ellerman, Lord Inchcape, Lord Inverforth, Sir Walter Runciman and Sir E Shadforth Watts. The Council chairman was Marmaduke Lawther.

The Royal Charter

The Royal Charter required the Institute not only to provide a proper education for its members and set examinations, it also insisted on a system of discipline so that any member acting in a discreditable manner would be censured, suspended or even expelled; in the latter case details may be published without any fear of legal action. That is, of course, still the case and, although action by the Discipline Committee is rarely needed, the committee members never shrink from their duty.

Much of Britain's trade was with member countries of the Commonwealth and these distant places attracted many expatriates to emigrate and continue their shipbroking in such places as Hong Kong, South Africa and British Columbia. Their desire to maintain their membership of the Institute prompted them to open local branches. Fortunately this had been foreseen when the charter was drafted so that membership was open to anyone in the British Commonwealth as well as the UK. A happy paradox was that Ireland was then the Irish Free State, which can best be described as half in and half out of the UK and so it was included in those countries covered by the charter. It was a happy paradox because when Ireland became an independent republic, no one had the heart to change their Institute status.

The 1920 Charter had stipulated that members of the Institute must be British-born. This rule was amended in 1947, allowing to citizens of Commonwealth countries to become members.

After the Second World War

The rapid development in trade and shipping following the end of the Second World War resulted in shipbrokers becoming specialised. They were no longer 'jacks of all trades' but masters of dry cargo chartering or tanker chartering or ship sale & purchase or port agency. Many companies that previously only handled tramps or tankers responded to the demands for agents made by the rapidly expanding number of national shipping lines, many of which were owned by recently independent members of the British Commonwealth; thus Liner Agency became an important branch of shipbroking.

In order to cope with the high degree of specialisation in shipping business, the Institute eventually modularised its examination syllabus and sub-divided shipbroking into six 'disciplines'; the sixth was added because of the demand to extend activities to take in ship operation and management.

Evolution was proceeding rapidly in another area. The programme of education, examination and eventual qualification was (and remains) unique, such that shipping personnel in countries outside the Commonwealth were asking why they could not take Institute examinations and become members. This prompted a series of discussions with the Privy Council, for which it posed something of a problem. In the same way as the Institute is obliged to exercise discipline over its members, so the Privy Council exercises discipline over chartered bodies. It is a noteworthy but not often publicised that the authority of the Privy Council is even greater than that of the elected government of the UK.

The solution to the Institute's problem was for the Privy Council to impose the stricture that the Controlling Council must always have a majority of British subjects. With this clarified, a Supplemental Charter was granted in 1984, which permits membership to be offered to citizens of any country in the world.

The same Supplemental Charter enabled the Institute to offer a new class of membership - Company Membership. Many official bodies, while recognising and respecting individual professional membership, are geared to working only with firms or companies. By creating this new class of membership various initiatives have become possible, including having representation on official committees and consulting with government departments. Perhaps the most significant appointment for Company Members has been the collection of Light Dues on behalf of Trinity House.


The Institute represents all aspects of the shipping business and includes in its membership not only shipbrokers but shipowners, charterers, agents, forwarders and other shipping professionals. It is dedicated to the setting and maintenance of the highest standards in international transport and shipping business.

Individual professional membership of the Institute is gained by candidates passing the Qualifying Examinations. Promotion to Fellowship permits the person to be described as a Chartered Shipbroker and is granted to those of seniority and influence in the world of shipping and international transport.

The Institute now has 27 branches of which seven are in the United Kingdom. Every year, in over 110 centres throughout the world, around 5,000 candidates sit its examinations. The Institute's qualification remains the unique hallmark of professionalism in the world of shipping business.