The medieval craft guilds developed as the forerunners of the present professional institutions. Each, within its own industry, set and regulated the standards of professional competence that customers might expect to receive when trading with their members. Competence and common standards were achieved by the development of systems of training through master and apprentice relationships: successful apprentices could themselves become masters of the craft and therefore members of their guild of which the badge of office was a livery - an identifiable gown - hence the title of livery company. Complaints about professional incompetence were investigated by the relevant guild and, if proved, the complainant would be compensated and the incompetent practitioner would be deprived of the right to practise the trade. In addition to this professional self-regulation the guilds also operated a system of financial support (or insurance) for those of their members falling upon hard times.

There are now over one hundred livery companies of which thirty or more have been founded in the second half of the twentieth century. The professional self-regulating function of most companies has been ceded to the appropriate professional institutions but involvement with beneficial giving to their trades and with the annual election of the Lord Mayor of London are still valued roles for all companies.