Black ownership on the JSE during the first three decades of democracy

Black ownership on the JSE during the first three decades of democracy

R35000,00

The methodology is based on actual ownership as reported by companies in their own annual reports.

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Description

BEE only applies to the South African operations or assets of JSE-listed companies. The paper calculates the value of South African operations or assets and provides two measures of black ownership: at the level of the whole JSE and after excluding the value of foreign operations or assets.

Where information is available, it also measures black ownership at the level of unlisted subsidiaries of JSE-listed companies. It provides statistics on black ownership within the critical mining and finance sectors. These sectors account for the majority of black ownership on the JSE.

The paper provides a brief historical overview and an analysis of corporate restructuring after 1994. It then outlines the three phases of BEE dealmaking from 1994 to 2024 and presents statistics on black ownership within the Top 60 JSE companies. The final section makes policy recommendations on how to redesign the ownership element of B-BBEE and kick-start a fourth phase of BEE transactions.

Why the Transformations Lens published this report

Over the past decade, South Africans have become confused by the dramatic differences between reported statistics of black ownership on the JSE. There is a now a bewildering maze of conflicting statistics, at the levels of the whole JSE, sectors such as mining and finance and individual companies. The measurement of black ownership has lost credibility and there is now no relationship between what companies disclose in their own their annual reports and the statistics that appear on their BEE certificates. Recently, there has also been a proliferation of false statistics and urban legends about black ownership on the JSE and the economy that are polluting public discourse.

The Transformation Lens is a new company that was established by Duma Gqubule and Colene Agbleke to provide evidence-based analysis of issues relating to economic development and transformation and create media platforms and events that will enrich public dialogue. Duma had a front row seat during the evolution of Black Economic Empowerment (BEE) – first as a financial journalist who interviewed pioneers of empowerment such as Nthato Motlana and Don Ncube then as an advisor on economic development and transformation who played an important role in developing the country’s BEE policies. In 2022, the BEE Commission gave him a spearhead award for his work in this area.

Alarmed by a decline in the quality of debate about BEE and black ownership on the JSE, Duma felt that he had to draw upon his unique experiences and expertise and conduct credible research on black ownership on the JSE which explained the different methodologies. The Transformation Lens has published a report that provides the most comprehensive ever analysis of black ownership on the JSE during the first three decades of democracy. The objectives are to change the narrative about BEE, accurately document.

Methodology

The methodology is based on actual ownership as reported by companies in their own annual reports.
BEE only applies to the South African operations or assets of JSE-listed companies. The paper calculates the value of South African operations or assets and provides two measures of black ownership: at the level of the whole JSE and after excluding the value of foreign operations or assets. Where information is available, it also measures black ownership at the level of unlisted subsidiaries of JSE-listed companies. It provides statistics on black ownership within the critical mining and finance sectors. These sectors account for the majority of black ownership on the JSE.

Content

The report provides a brief historical overview and an analysis of corporate restructuring after 1994. It then outlines the three phases of BEE dealmaking from 1994 to 2024 and presents statistics on black ownership within the Top 60 JSE companies. The final section makes policy recommendations on how to redesign the ownership element of B-BBEE and kick-start a fourth phase of BEE transactions. The appendix below provides a more detailed explanation of what will be in the report.

Appendix: Black Ownership within the JSE Top 60 Companies

The paper includes the following.

  1. Deal flow statistics for the period 1994 to 2024
  2. A qualitative analysis of BEE transactions during the following phases
    1. The first phase of BEE transactions (1994 – 2002)
    2. The second phase of BEE transactions (2003 – 2008)
    3. The third phase of BEE transactions (2009 – 2024)
  3. The market capitalisation of the JSE Top 60 companies
  4. The BEE market capitalisation of the JSE Top 60 companies
  5. PIC market capitalisation within the Top 60 JSE companies
  6. The market capitalisation of JSE-listed companies with no SA assets
  7. The value of SA assets within the JSE Top 60 companies
    1. Mini case studies of every company which explain the methodologies used to calculate the value of SA assets
  8. BEE market capitalisation of transactions concluded at the level of unlisted subsidiaries or other operations of Top 60 JSE-listed companies
  9. Summary of black ownership at the listed and unlisted levels as percentages of the JSE and SA assets
  10. The top 15 transactions by value since 1994
  11. The best BEE transactions of all time
  12. The worst BEE transactions of all time
  13. Black ownership by broad-based ownership schemes (BBOS) and strategic black partners (SBPs)

Who should buy the report?

  • International audiences who have an interest in BEE and the South African economy
  • Many South Africans who believe in BEE and economic transformation
  • Government departments and policy markers
  • Business and professional organisations
  • JSE listed companies
  • BEE companies
  • Trustees of broad-based ownership schemes and employee share ownership plans
  • Academic community
  • Independent think tanks and researchers
  • Investment bankers

Black Ownership in the Mining Sector

The report has a comprehensive analysis of black ownership in 14 companies in the mining sector that are part of the Top 60 JSE-listed companies that had a market capitalisation of R5.4 trillion. After stripping out the value of the non-South African companies (BHP Group and AngloGold) and other foreign assets, the value of South African assets was almost R900 billion. We also analyse the Public Investment Corporation’s (PIC’s) ownership in the mining sector.

Black Ownership in the Finance Sector

The report has a comprehensive analysis of black ownership in 14 companies in the finance sector that are part of the Top 60 JSE-listed companies that had a market capitalisation of R2.2 trillion. After stripping out the non-South African assets, the value of South African assets was R1.6 trillion. We also analyse the Public Investment Corporation’s (PIC’s) ownership in the financial sector.

Broad Based Ownership Schemes

The report provides a comprehensive analysis of ownership by broad-based ownership schemes within the Top 60 JSE-listed companies. The biggest myth is that BEE has only benefited the politically connected few. While politicians such as president Cyril Ramaphosa and former Gauteng premier Tokyo Sexwale benefitted from earlier waves of empowerment, an analysis of the current composition of black shareholders within the JSE Top 60 companies shows that this is no longer true.

The most surprising finding was that two-thirds of shares owned by black people on the JSE were broad-based ownership schemes. This included 14 employee schemes worth R40.7 billion and community-owned companies such as Royal Bafokeng Holdings, which had a net asset value of R56 billion at the end of December 2024. There are public retail schemes such as Multichoice’s Phuthuma Nathi which had 73 791 shareholders in March 2025 and has paid dividends of R19.6 billion since inception in 2006.

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