Black Ownership On the JSE Top 100 Still Only 9%

Stock exchange

VENTURES AFRICA – Black ownership of stocks on the Johannesburg Stock Exchange (JSE) stands at only 9 percent, according to a study released on Thursday, falling short of black empowerment targets.

According to a JSE-commissioned study released on Thursday, 9 per cent of the top 100 companies listed on the JSE – which account for approximately 90 per cent of the bourse’s $834 million market cap – are directly owned by black investors.

When pension funds and indirect holdings are taken into account, the black ownership figure rises to 21 per cent; while if foreign stockholders are excluded from considerations the figure rises once again, reaching 34 per cent black ownership.

“If you look at the demographics of this country, what would be normal is that no less than 50 percent of the JSE (Johannesburg Stock Exchange) should be owned by black people,” African National Congress (ANC) spokesman Keith Khoza said according to Reuters.

Since the end of apartheid in 1991, the ANC – which officially came to power in 1994 – has pushed black economic empowerment (BEE) initiatives as a pivotal factor in political policies, setting targets for black ownership of companies, among other economic targets.

The current study shows that while some headway has been made in increasing black ownership of companies and increase black participation in the economic arena, BEE targets have not yet been met – almost two decades after the end of apartheid – with the majority of JSE listed companies remaining under non-black ownership – despite South Africa’s black population making up in excess of 80 per cent of the overall population.

The lag in achieving ANC and BEE targets has prompted many – in particular the ANC’s youth league, to argue in favour of land and wealth redistribution much along the lines of Zimbabwe’s policies, which saw land re-seized from non-black owners, and mines and banks nationalised in a move to improve national wealth distribution.

Commenting on the study, head of the Black Business Council Sandile Zungu, argues that what is needed is more engagement by the whole South African population with the state of the economy; and a push to grow the economy and transform its current standing.

“There’s reasonable progress in the level of ownership by black people, notwithstanding the fact that the economy has not grown significantly over the last year…What that really means is that there’s beginning to be an attitude among South Africans that we have to transform the economy,” Zungu told Talk Radio 702.