scholarly journals Market reaction to trading statements released by Johannesburg Stock Exchange listed companies

2021 ◽  
Vol 18 (1) ◽  
pp. 21-47
Author(s):  
N BHANA ◽  
Keyword(s):  
Market Reaction ◽  
Stock Exchange ◽  
Listed Companies ◽  
Johannesburg Stock Exchange

scholarly journals The effect of industry nuances on the relationship between corporate governance and financial performance: Evidence from South African listed companies

2018 ◽  
Vol 21 (1) ◽  
Author(s):  
Jonty Tshipa ◽  
Leon M. Brummer ◽  
Hendrik Wolmarans ◽  
Elda Du Toit
Keyword(s):  
Corporate Governance ◽  
Financial Performance ◽  
South African ◽  
Resource Dependence ◽  
Stock Exchange ◽  
Listed Companies ◽  
Company Performance ◽  
Johannesburg Stock Exchange ◽  
Good Corporate Governance ◽  
The Relationship

Background: Premised on agency, resource dependence and stewardship theories, the study investigates empirically the existence of industry nuances in the relationship between corporate governance and financial performance of companies listed in the Johannesburg Stock Exchange. Aims: The main objective of the study is to understand the relationship between internal corporate governance and company performance from the perspective of three distinct economic periods, as well as industry nuances, cognisant of endogeneity issues. Setting: South Africa, as an emerging African market, offers an interesting research context in which the corporate governance and financial performance nexus can be examined empirically. Method: A sample of 90 companies from the five largest South African industries, covering a 13-year period from 2002 to 2014 (1170 firm-year observations) was examined with three estimation approaches. Results: Two key trends emerged from this study. First, the relationship between corporate governance and company performance differed from industry to industry. Second, the association between corporate governance and company performance also changes during steady and non-steady periods, which is an indication that the nexus is driven by the state of the global economy and the type of the industry. Conclusion: Evidence from the study suggests that companies should be allowed to optimise rather than maximise their corporate governance options. This finding questioned the approach of the recently published King IV Code of Good Corporate Governance, which requires Johannesburg Stock Exchange-listed companies to ‘apply and explain’ as opposed to ‘apply or explain’ as pronounced by King III Code of Good Corporate Governance.

scholarly journals Integrating ESG factors in investment decisions by mutual fund managers: a case of selected Johannesburg Stock Exchange-listed companies

2020 ◽  
Vol 17 (4) ◽  
pp. 258-270
Author(s):  
Michael Bamidele Fakoya ◽  
Segopotje Evonia Malatji
Keyword(s):  
Mutual Fund ◽  
Stock Exchange ◽  
Panel Data Analysis ◽  
Listed Companies ◽  
Business Practices ◽  
Mutual Fund Managers ◽  
Responsible Investment ◽  
Fund Managers ◽  
Johannesburg Stock Exchange ◽  
Asset Managers

This paper examines whether mutual fund managers incorporate environmental, social, and governance (ESG) factors when deciding which sector to invest on behalf of their trustees. In doing this, the top 20 South African mutual fund companies (asset managers) listed on the Johannesburg Stock Exchange (JSE) were selected. The paper identified the top 30 JSE listed companies (in the large industrial, equipment, and machinery sectors, excluding unlisted and service-oriented companies) where trustees’ funds were invested (with a total of 28 companies between 2007 and 2017) from the mutual fund companies’ Equity Fund Fact Sheets 2017 (representing recent investment focus). ESG data were collected from the integrated and sustainability reports at the sampled companies’ websites, and financial data were sourced from the IRESS database. This study adopted the panel data analysis. The results show an insignificant negative relationship between the ESG proxies (water usage, employee health and safety cost [number of work-related fatalities], percentage of women on corporate board) and return on equity (ROE). This means that the sampled companies disregard the United Nations Principle of Responsible Investment (UN PRI) guideline, suggesting that asset managers focus on increasing returns on shareholders’ investment without considering ESG issues. The paper concludes that the disregard for responsible investment guidelines does not encourage companies to improve their unsustainable business practices.

scholarly journals The Day Of The Week Effect: An Analysis Of The Johannesburg Stock Exchange Top 40 Firms

2013 ◽  
Vol 12 (3) ◽  
pp. 319
Author(s):  
James Plimsoll ◽  
Ben Saban ◽  
Andreas Spheris ◽  
Kanshukan Rajaratnam
Keyword(s):  
Stock Exchange ◽  
Listed Companies ◽  
Previous Literature ◽  
Specific Level ◽  
Johannesburg Stock Exchange ◽  
Specific Focus ◽  
Day Of The Week ◽  
Top 40 ◽  
Micro Analysis ◽  
Estimation Models

This study investigates the existence of the Day of the Week (DoW) effect on returns and volatility on the Johannesburg Stock Exchange (JSE), with a specific focus on the markets Top 40 firms (Top40). It is the most micro analysis of the DoW effect conducted to date, as previous literature has only explored the effect on market and index levels. While this paper focuses on a firm-specific level, it also makes a comparison with the DoW effect on the All-Share Index (ALSI) and Top40 Index (TOPI). Drawing on Borges (2009) study, this paper investigates whether a DoW effect exists on a specific day compared with the rest of the week. This is achieved by regressing returns on each day of the week separately. GARCH estimation models are used to test for a DoW effect with regards to variance in share returns. The initial findings show that neither the ALSI nor the TOPI have any significant DoW effects. However, a more micro examination reveals that ten of the Top40 firms have significant DoW effects on at least one day of the week. The investigation reveals no significant DoW effects with regards to volatility, which highlights that the constituents of the Top40 typically achieve consistent returns compared to other listed companies.

scholarly journals An exploratory study of the effect of country-by-country reporting ambiguities on Johannesburg Stock Exchange-listed companies

2018 ◽  
Vol 21 (1) ◽  
Author(s):  
Cara Thiart ◽  
George F. Nel
Keyword(s):  
South Africa ◽  
Financial Reporting ◽  
Multinational Enterprises ◽  
Stock Exchange ◽  
Listed Companies ◽  
Annual Reports ◽  
Reporting Standards ◽  
Financial Reporting Standards ◽  
Johannesburg Stock Exchange ◽  
Group Structures

Background: South Africa issued regulations implementing country-by-country (CbC) reporting standards for multinational enterprises (MNEs) on 23 December 2016. Country-by-country reporting will be applicable to all MNEs with a group revenue in excess of R10 billion. Aim: The aim of the study was twofold: to identify ambiguities that might influence the filing obligation and subsequent scope of CbC reporting in South Africa and to quantitatively measure the potential impact of any identified ambiguities. Setting: This study used data from Johannesburg Stock Exchange-listed companies. Methods: The study commences with a review of the relevant regulations and other applicable literature and continues with a quantitative analysis exploring alternative interpretations deduced from this review. Results: The review identified conflicting interpretations of how companies can be categorised as an MNE Group or not, as well as in measuring the revenue threshold. An analysis of the group structures and annual reports of a selected sample of 78 companies showed that the scope of CbC reporting will depend on the definitions applied to an MNE Group and revenue. Conclusion: Further guidance is needed to determine whether non-controlling entities must be considered as Constituent Entities, as well as how to measure revenue (i.e. whether only the International Financial Reporting Standards [IFRS] 15 revenue line item should be used or whether other income should also be included).

An Application Of Data Envelopment Analysis To Benchmark CEO Remuneration: A South African Study

2013 ◽  
Vol 29 (5) ◽  
pp. 1509 ◽  
Author(s):  
Marli Theunissen ◽  
Merwe Oberholzer
Keyword(s):  
Data Envelopment Analysis ◽  
South African ◽  
Stock Exchange ◽  
Listed Companies ◽  
Data Envelopment ◽  
Efficiency Frontier ◽  
Cross Sectional ◽  
Johannesburg Stock Exchange ◽  
Multiple Components ◽  
And Performance

<p>The purpose of the study is twofold; firstly, to use data envelopment analysis (DEA) to estimate the technical efficiencies of Johannesburg Stock Exchange (JSE)-listed companies (per industry) to convert the multiple components of CEO remuneration into multiple company determinants, namely size and performance indicators, and secondly, to develop an efficiency frontier to serve as a benchmark to suggest acceptable CEO remuneration levels. An empirical study was executed on a sample of 221 JSE-listed companies. Cross-sectional data of CEO remuneration and company determinants were obtained from the McGregor BFA database for the 2010 financial year. The study found that CEOs from 80 of the 221 companies included in the sample emerged as the benchmark CEOs and formed the efficiency frontier against which inefficient CEOs were compared. The practical value is that remuneration committees can use this model, which is based on best practices, to simplify the structuring of reasonable CEO remuneration packages.</p>

Sources of accountability inside the boardroom

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Julia Goodman ◽  
Hayley Pearson ◽  
Morris Mthombeni
Keyword(s):  
South Africa ◽  
Stock Exchange ◽  
Listed Companies ◽  
Board Members ◽  
Exploratory Research ◽  
Executive Board ◽  
Content Type ◽  
Johannesburg Stock Exchange ◽  
Governance Effectiveness ◽  
Felt Accountability

Purpose Despite indications of scholarly interest, there are still gaps in the research of the concept of felt accountability, especially the felt accountability of board members. This paper aims to clarify the sources of accountability experienced by board members. Especially those in a non-executive capacity. How these sources can be accessed to enhance felt accountability and thereby governance effectiveness is explored. Design/methodology/approach Qualitative, exploratory research methods were used. In total, 15 semi-structured, in-depth interviews were completed with non-executive board members of Johannesburg Stock Exchange listed companies in South Africa. Thematic content analysis was used to analyse data. Findings The findings clarified the formal and informal sources of accountability experienced by non-executive board members. This included relational and structural mechanisms that can be used within corporate governance to enhance both types of accountability. Accessing the identified sources of accountability through appropriate mechanisms could increase the levels of felt accountability experienced by the individual non-executive board member, thereby strengthening accountability inside the boardroom and improving overall board effectiveness. The study also revealed a layer of implicit and explicit accountability. Research limitations/implications The study was conducted solely in South Africa, with non-executive board members of Johannesburg Stock Exchange listed companies. Originality/value There is limited research that clarifies the sources of accountability experienced by non-executive board members. This study aims to address this gap in the literature by providing techniques on how to enable the clarified sources of accountability to improve governance effectiveness.

scholarly journals IT risk management disclosure in the integrated reports of the top 40 listed companies on the JSE limited

2017 ◽  
Vol 7 (3) ◽  
pp. 27-34
Author(s):  
Ben Marx ◽  
Covanni Du Preez
Keyword(s):  
Information Technology ◽  
Risk Management ◽  
Stock Exchange ◽  
Listed Companies ◽  
It Risk Management ◽  
Annual Basis ◽  
Johannesburg Stock Exchange ◽  
Increase Productivity ◽  
Top 40 ◽  
It Risk

Information Technology (IT) has become an integral part of virtually all modern day organisations. The advent of IT has given rise to numerous benefits which increase productivity and efficiency in the workplace, however, IT also brings with it significant risks that can have an impact on an organisation’s ability to function as a going concern. Organisations, especially those listed on the Johannesburg Stock Exchange (JSE), are required to submit an Integrated Report (IR) on an annual basis in which they indicate how they used the resources at their disposal to create value for the organisation and its stakeholders during the year under review. The IR is also a forward-looking document, as opposed to the traditional, backward-looking reports. The purpose of this paper is to determine to what extent IT Risk and IT Risk Management are disclosed in the IR’s of the Top 40 Listed Companies on the JSE. It further aims to determine whether IT Risks are included as material risk in the entity’s risk statements of the Integrated Report, and whether proper explanations are provided on how the materiality of the risks are determined and dealt with. This is done by means of an empirical study consisting of a content analysis of the IRs of the Top 40 listed companies on the JSE. The results of the analysis indicates that more than half of the companies included IT risk as part of their material risks and outlined appropriate and detailed processes that were followed by the company to manage those IT risks. The findings of the study accordingly support the need for communicating significant risks and the management thereof to stakeholders as part of the integrated nature of governance of entities. However, it is disconcerting that some companies are not doing this, and accordingly are not realising the need for communicating significant matters to their stakeholders and the value that informative and credible reporting will bring to an entity’s Integrated Report.

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