[South Africa] JSE amends listing requirements to include disclosure on promotion of racial diversity at board level
The Johannesburg Stock Exchange has amended its Listing Requirements to ensure that its listed companies have a policy in place to promote racial diversity at board level. These amendments have been implemented in conjunction with amendments dealing with the King IV Report on Corporate Governance.
The JSE commenced with proposed amendments to its listing requirements after the King IV Report was released in November 2016. The amended requirements include a policy on the promotion of race diversity policy at board level and the publication of an annual compliance report following the Broad-Based Economic Empowerment Amendment Act No.46 of 2013 (the “BBEE Act”).
The implementation date of the required disclosure in the annual report of the policy on the promotion of race diversity at board level will be 1 June 2018. As such all annual reports issued on or after 1 June 2018 will have to comply with the required disclosure. The intention with the lead time is to afford listed companies with sufficient time to comply with the new requirement.
Publication of the annual compliance report pursuant to the BBEE Act is required from 19 June 2017. The amended Listing Requirements are twofold:
Racial diversity disclosure at board level. This means that companies must have a policy for the promotion of racial diversity at board level and they are further required to report annually to their shareholders how they have applied the policy. Listed companies are also required to report on how they have complied with their own voluntary targets and are also required to report on the progress they have made.
Listed companies are required to publish their Broad Based Black Economic Empowerment annual compliance report on their company website and are further required to make an announcement on the stock exchanges news service (SENS) that this has been published on their website.
Zeona Jacobs, Director Marketing and Corporate Affairs at the JSE, says the JSE strongly supports the transformation of the South African economy and believes it can contribute to this. “The exchange is committed to the transformation of our country’s Capital Markets. Our focus is both on transformation in how we run our own business, JSE Ltd, as well as well influencing our broader eco-system which includes our listed companies, investors and intermediaries.”
Jacobs concludes that, notwithstanding these implementation dates, the JSE encourages early implementation of the new Listing Requirements. The JSE listing requirements already require companies to have and to report on their policies on the promotion of gender diversity at board level, a requirement which became into effect on 1 January 2017 and was well received by listed companies.