Final Fantasy VII used a unique approach for its antagonists at the start of the game, as the members of Avalanche weren't fighting an evil army or a demon with lots of arms and legs. Instead, the enemy was a sleazy corporation that had a monopoly on a power source that everyone used. As such, the general population turned a blind eye to the fact that the world had been taken over by the Shinra Electric Power Company, due to sheer convenience.
The Shinra Electric Power Company returns as villains in Final Fantasy VII Remake, where they are given a much bigger role in the story. Final Fantasy VII Remake offers a new look at the history of the Shinra, but there is still a lot that is left unsaid about some of the most hated villains in the Final Fantasy series.
The X-2 Connection
In Final Fantasy X-2, there is a young boy named Shinra who makes comments about using the power of the Farplane as an energy source, but that it would take several generations to accomplish. The creators of Final Fantasy VII and Final Fantasy X/X-2 have made light-hearted comments about the two settings being connected in Japan-only guidebooks, but most fans have discounted these statements as banter.
Final Fantasy VII Remake included an easter egg that shows an old photo of the Shinra staff. Sitting in the center of the picture is a person wearing a mask that is similar to the one worn by Shinra in Final Fantasy X-2. As such, there is now more evidence that the Shinra Electric Power Company was conceived by Shinra or his descendants.
Final Fantasy VII
The Shinra Electric Power Company started out as the Shinra Manufacturing Works, but they came into power when a Shinra scientist discovered who to utilize the Lifestream in order to create Mako. This was accomplished with massive Mako Reactors, which could power entire regions cheaply. The Shinra Electric Power Company soon became incredibly wealthy, and they developed their own security force that allowed them to slowly take over the world. The Shinra Electric Power Company had an entire army of soldiers that it could mobilize, as well as a fleet of vehicles, ships, and airships at its disposal. Shinra also had the Turks to do the dirty work behind the scenes, including assassination, blackmail, and espionage. The Final Fantasy villains from previous games tried to take over the world by force or by transforming themselves with unholy rituals, but the Shinra did it through wealth and backdoor deals. In the end, the citizens of the world handed over power to the Shinra Electric Power Company, all except for one nation - Wutai.
The last major conflict before the events of Final Fantasy VII began involved a war between the Shinra Electric Power Company and the nation of Wutai. The war broke out when Wutai refused to allow a Mako Reactor to be built within its borders. The war lasted for several years, but Shinra was victorious, thanks to the aid of warriors like Angeal Hewley, Genesis Rhapsodos, Zack Fair, and Sephiroth.
Jenova & SOLDIER
The secret behind the Shinra Electric Power Company's military might was the discovery of Jenova in the North Crater. Jenova was an alien lifeform that landed on the world centuries before the events of Final Fantasy VII took place. The Cetra managed to slay Jenova and seal her within the North Crater, but most of their race was wiped out in the process.
Professor Gast Faremis discovered the corpse of Jenova and misidentified it as a Cetra. Jenova cells were implanted in members of SOLDIER in order to increase their strength. A few members of SOLDIER were implanted with Jenova cells while still in the womb. Angeal, Genesis, and Sephiroth were all created through this process. Sephiroth became a hero during the Wutai War, as no one could withstand his might. The Jenova cells transformed Sephiroth into an unstoppable warrior.
The fact that the Shinra Electric Power Company dabbled with nature is what led to their downfall. The word got out that Mako energy was draining the life force of the planet, which would eventually lead to an apocalyptic event if left unchecked. Terrorist groups like Avalanche sprang up and started to oppose the Shinra. The company's real downfall happened when the members of SOLDIER defected, leading to Angeal's death, Genesis being sealed away, and Sephiroth going berserk. Sephiroth killed President Shinra and his actions led to the downfall of the company in the Final Fantasy VII timeline. With that being said, Final Fantasy VII Remake takes place in a new timeline, so it's possible that the Shinra Electric Power Company will meet a different fate in the future.
Final Fantasy VII Remake is available now for PlayStation 4.