An analysis of the effect that integrated reporting has had on the description of the strategy and strategic planning process in the banking sector in South Africa
- Authors: Musuwo, Getrude Tafadzwa
- Date: 2017
- Language: English
- Type: Thesis , Masters , MBA
- Identifier: http://hdl.handle.net/10962/40990 , vital:25045
- Description: The study was carried out in order to analyse the effect which the requirement for integrated reporting has had on the description of strategy and strategic planning processes of three South African Banks during the three-year period between 2012 and 2014. The study was conducted in three Johannesburg Stock Exchange listed Banks namely Barclays Bank, Capitec Bank and Standard Bank and focused on their integrated reports for 2012 to 2014. The objectives of the study were to analyse the change in the scope of the depth of reporting on strategy, analyse the evolution of the strategic planning process, compare and contrast the banks’ nature, scope and depth of reporting and establish how the requirement for integrated reporting has impacted on the strategic planning processes in the banks. The study was carried out as a content analysis of the integrated reports of the three banks. The sample for the study consisted for the 9 integrated reports issued by the three banks in the period from 2012 to 2014. There was an increasing trend in the prominence of reporting on strategy by the C.E.Os and chairmen of the companies in the integrated reports. All the companies exhibited an increase in the depth of their reporting on strategy in their overall integrated reports. There is a general increase in the depth of reporting on value creation in the integrated reports. From discussing their business models to some extent in 2012 and 2013, all integrated reports reported on strategy to a large extent in 2014. The study concluded that the scope and depth of reporting on strategy was growing. The study also concluded that strategic planning processes had been transformed due to the requirement for integrated reporting. It was also concluded that Standard Bank had the greatest focus on strategy. Further studies may focus beyond strategy and explore the extent to which companies are implementing non-financial measures in their integrated reporting.
- Full Text:
- Date Issued: 2017
- Authors: Musuwo, Getrude Tafadzwa
- Date: 2017
- Language: English
- Type: Thesis , Masters , MBA
- Identifier: http://hdl.handle.net/10962/40990 , vital:25045
- Description: The study was carried out in order to analyse the effect which the requirement for integrated reporting has had on the description of strategy and strategic planning processes of three South African Banks during the three-year period between 2012 and 2014. The study was conducted in three Johannesburg Stock Exchange listed Banks namely Barclays Bank, Capitec Bank and Standard Bank and focused on their integrated reports for 2012 to 2014. The objectives of the study were to analyse the change in the scope of the depth of reporting on strategy, analyse the evolution of the strategic planning process, compare and contrast the banks’ nature, scope and depth of reporting and establish how the requirement for integrated reporting has impacted on the strategic planning processes in the banks. The study was carried out as a content analysis of the integrated reports of the three banks. The sample for the study consisted for the 9 integrated reports issued by the three banks in the period from 2012 to 2014. There was an increasing trend in the prominence of reporting on strategy by the C.E.Os and chairmen of the companies in the integrated reports. All the companies exhibited an increase in the depth of their reporting on strategy in their overall integrated reports. There is a general increase in the depth of reporting on value creation in the integrated reports. From discussing their business models to some extent in 2012 and 2013, all integrated reports reported on strategy to a large extent in 2014. The study concluded that the scope and depth of reporting on strategy was growing. The study also concluded that strategic planning processes had been transformed due to the requirement for integrated reporting. It was also concluded that Standard Bank had the greatest focus on strategy. Further studies may focus beyond strategy and explore the extent to which companies are implementing non-financial measures in their integrated reporting.
- Full Text:
- Date Issued: 2017
An investigation of the relationship between Corporate Social Responsibility (CSR) and financial performance of companies listed on the Johannesburg Stock Exchange (JSE) in South Africa
- Authors: Soko, Leon Lenny Kudzaishe
- Date: 2017
- Language: English
- Type: Thesis , Masters , MBA
- Identifier: http://hdl.handle.net/10962/7078 , vital:21215
- Description: The purpose of this study is to investigate whether there is an association between CSR and financial performance in South African companies which are listed on the FTSE/JSE SRI Index. Specifically, whether there is a difference in financial performance of companies that perform CSR activities, and those that do not. If so, which direction does this association have? The selection process of companies used in this study will now be explained step-bystep. The JSE SRI Index results show that there were 80 successful constituents as of February 2015 (JSE, 2015). These 80 companies are listed alphabetically in Appendix A, while the top 100 companies as ranked by Turnover are linked in Appendix B. Of these 100 companies, 67 were constituents of the JSE SRI Index continuously in 2015 and are shown in Appendix C. This leaves 33 companies in the top 100 which are not listed on the JSE SRI Index. Companies that were listed on the JSE SRI Index were assumed to be ‘good’ companies as the listing requirements included the performance of numerous CSR activities such as Employee development, environmental sustainability practices and stakeholder engagement. The financial performance of these 67 companies was compared to the financial performance of the 33 companies that were not listed on the JSE SRI Index which were included in the population sample of one hundred companies. Financial performance was measured using the ratios: Return on Assets and Return on Equity. The data analysis process used in this study was as follows: 1. The ratios for each company were obtained from the iNET (BFA) database, and annual and integrated reports for the period 2011 - 2015 (Appendix D;E;F). 2. The ratios for Non-SRI and SRI companies were then compared for each of the three ratios using a T-Test. The purpose of the T-Test was to show whether there is a difference in the ratios between SRI and Non-SRI companies on a year to year basis. The direction of the difference was shown by whether the SRI ratio was higher than or lower than the Non-SRI ratio. The results of this study do not seem to support any of the CSR theories, as the study concluded that there is no significant difference between the financial performance of companies that perform CSR activities and those that do not. This means that investing in CSR activities does not have a significant effect on the financial performance of a company.
- Full Text:
- Date Issued: 2017
- Authors: Soko, Leon Lenny Kudzaishe
- Date: 2017
- Language: English
- Type: Thesis , Masters , MBA
- Identifier: http://hdl.handle.net/10962/7078 , vital:21215
- Description: The purpose of this study is to investigate whether there is an association between CSR and financial performance in South African companies which are listed on the FTSE/JSE SRI Index. Specifically, whether there is a difference in financial performance of companies that perform CSR activities, and those that do not. If so, which direction does this association have? The selection process of companies used in this study will now be explained step-bystep. The JSE SRI Index results show that there were 80 successful constituents as of February 2015 (JSE, 2015). These 80 companies are listed alphabetically in Appendix A, while the top 100 companies as ranked by Turnover are linked in Appendix B. Of these 100 companies, 67 were constituents of the JSE SRI Index continuously in 2015 and are shown in Appendix C. This leaves 33 companies in the top 100 which are not listed on the JSE SRI Index. Companies that were listed on the JSE SRI Index were assumed to be ‘good’ companies as the listing requirements included the performance of numerous CSR activities such as Employee development, environmental sustainability practices and stakeholder engagement. The financial performance of these 67 companies was compared to the financial performance of the 33 companies that were not listed on the JSE SRI Index which were included in the population sample of one hundred companies. Financial performance was measured using the ratios: Return on Assets and Return on Equity. The data analysis process used in this study was as follows: 1. The ratios for each company were obtained from the iNET (BFA) database, and annual and integrated reports for the period 2011 - 2015 (Appendix D;E;F). 2. The ratios for Non-SRI and SRI companies were then compared for each of the three ratios using a T-Test. The purpose of the T-Test was to show whether there is a difference in the ratios between SRI and Non-SRI companies on a year to year basis. The direction of the difference was shown by whether the SRI ratio was higher than or lower than the Non-SRI ratio. The results of this study do not seem to support any of the CSR theories, as the study concluded that there is no significant difference between the financial performance of companies that perform CSR activities and those that do not. This means that investing in CSR activities does not have a significant effect on the financial performance of a company.
- Full Text:
- Date Issued: 2017
Drivers of sustainability disclosure in Liberty Holdings
- Authors: Chembeya, Edina Matamba
- Date: 2017
- Subjects: Liberty Holdings Limited (Firm) , Insurance companies -- South Africa -- Management , Risk management -- South Africa -- Case studies , Stakeholder management -- South Africa -- Case studies , Corporate culture -- South Africa -- Case studies , Product management -- South Africa -- Case studies
- Language: English
- Type: Thesis , Masters , MBA
- Identifier: http://hdl.handle.net/10962/5579 , vital:20943
- Description: This research assesses the drivers of sustainability disclosure in Liberty Holdings. The relevance of reporting on sustainability is growing for both listed and non-listed companies in South Africa. However, many companies many companies still coming to terms with reporting process, although others are doing exceptionally well. Liberty Holdings is one of the insurance organisations that has continuously improved their sustainability reporting and disclosure of their sustainability issues, in a sector that previously perceived such concerns as low on their agenda, due to the perception that they had a low impact on the sector. The research findings reveal that the process of sustainability disclosure in Liberty Holdings is driven by several elements that are strategically linked and are aligned to the core strategy of the organisation. The findings also indicate that in order to understand and implement viable sustainability processes, the processes must be embedded in a well-informed sustainability strategy that is aligned with this core strategy.
- Full Text:
- Date Issued: 2017
- Authors: Chembeya, Edina Matamba
- Date: 2017
- Subjects: Liberty Holdings Limited (Firm) , Insurance companies -- South Africa -- Management , Risk management -- South Africa -- Case studies , Stakeholder management -- South Africa -- Case studies , Corporate culture -- South Africa -- Case studies , Product management -- South Africa -- Case studies
- Language: English
- Type: Thesis , Masters , MBA
- Identifier: http://hdl.handle.net/10962/5579 , vital:20943
- Description: This research assesses the drivers of sustainability disclosure in Liberty Holdings. The relevance of reporting on sustainability is growing for both listed and non-listed companies in South Africa. However, many companies many companies still coming to terms with reporting process, although others are doing exceptionally well. Liberty Holdings is one of the insurance organisations that has continuously improved their sustainability reporting and disclosure of their sustainability issues, in a sector that previously perceived such concerns as low on their agenda, due to the perception that they had a low impact on the sector. The research findings reveal that the process of sustainability disclosure in Liberty Holdings is driven by several elements that are strategically linked and are aligned to the core strategy of the organisation. The findings also indicate that in order to understand and implement viable sustainability processes, the processes must be embedded in a well-informed sustainability strategy that is aligned with this core strategy.
- Full Text:
- Date Issued: 2017
Evaluating the impact of responsible investing strategies on fund performance
- Authors: Ntuli, Thulani
- Date: 2017
- Language: English
- Type: Thesis , Masters , MBA
- Identifier: http://hdl.handle.net/10962/7067 , vital:21214
- Description: Several studies have been undertaken to evaluate performance of responsible investments, that is, funds that integrate ethical as well as environmental, social and governance considerations in the investment process (ESG). Particularly to address the question whether it is possible for investors to do well while doing good. Modern Portfolio Theory predicts sub-optimal performance for funds constructed on any basis other than risk-reward optimisation. These studies usually compare performance of responsible investments with conventional funds or an unrestricted benchmark portfolio. The findings have been contradictory and on the main inconclusive. Underlying this contradiction is the treatment of responsible investments funds as a homogenous group of funds and not acknowledging their heterogeneity owing to methods and strategies used to construct them. This study seeks to address this gap in the literature by investigating the impact of responsible investment strategies on fund performance. The performance of nine South African responsible investment funds constructed and manged using different responsible investing strategies are analysed over a five-year period from 01 October 2010 to 31 October 2015. Their performance is benchmarked against the JSE ALL Share Index (ALSI) and the FTES/JSE SRI index. Specifically, the average monthly returns, variability and Sharpe ratio of the constituent fund is used to compare performance. Moreover, the CAPM based Jensen alpha is used to determine any significant under or overperformance of respective funds relative to the benchmarks. The study found to be no difference in average monthly returns and risk relative to the two benchmark indices for all respective strategies. However, funds constructed using the negative screening strategy generally underperform. These funds overall deliver a statistically significant lower alpha. It is concluded that this RI investing strategy is not suitable for investors concerned about a trade-off between fund performance and ESG performance.
- Full Text:
- Date Issued: 2017
- Authors: Ntuli, Thulani
- Date: 2017
- Language: English
- Type: Thesis , Masters , MBA
- Identifier: http://hdl.handle.net/10962/7067 , vital:21214
- Description: Several studies have been undertaken to evaluate performance of responsible investments, that is, funds that integrate ethical as well as environmental, social and governance considerations in the investment process (ESG). Particularly to address the question whether it is possible for investors to do well while doing good. Modern Portfolio Theory predicts sub-optimal performance for funds constructed on any basis other than risk-reward optimisation. These studies usually compare performance of responsible investments with conventional funds or an unrestricted benchmark portfolio. The findings have been contradictory and on the main inconclusive. Underlying this contradiction is the treatment of responsible investments funds as a homogenous group of funds and not acknowledging their heterogeneity owing to methods and strategies used to construct them. This study seeks to address this gap in the literature by investigating the impact of responsible investment strategies on fund performance. The performance of nine South African responsible investment funds constructed and manged using different responsible investing strategies are analysed over a five-year period from 01 October 2010 to 31 October 2015. Their performance is benchmarked against the JSE ALL Share Index (ALSI) and the FTES/JSE SRI index. Specifically, the average monthly returns, variability and Sharpe ratio of the constituent fund is used to compare performance. Moreover, the CAPM based Jensen alpha is used to determine any significant under or overperformance of respective funds relative to the benchmarks. The study found to be no difference in average monthly returns and risk relative to the two benchmark indices for all respective strategies. However, funds constructed using the negative screening strategy generally underperform. These funds overall deliver a statistically significant lower alpha. It is concluded that this RI investing strategy is not suitable for investors concerned about a trade-off between fund performance and ESG performance.
- Full Text:
- Date Issued: 2017
Evaluating the share performance of socially responsible investment on the Johannesburg Stock Exchange
- Authors: Cormack, Bradley Alexander
- Date: 2017
- Subjects: Investments -- Moral and ethical aspects -- South Africa , Johannesburg Stock Exchange , Social responsibility of business -- Standards , Social responsiblity of business -- South Africa
- Language: English
- Type: Thesis , Masters , MBA
- Identifier: http://hdl.handle.net/10962/36251 , vital:24532
- Description: Socially responsible investing (SRI) integrates environmental, social and governance (ESG) issues into the investment decision-making process. Growing ESG concerns and the uncovering of corporate scandals have catalysed the substantial growth in SRI portfolios worldwide. Notwithstanding its increasing popularity, barriers to further SRI growth have been identified. Traditional investing practices suggest that theoretically, SRI may underperform conventional investment strategies. However, despite the vast amount of literature on SRI, empirical studies have yielded a mixture of results regarding fund performance. The JSE SRI Index was launched in 2004 to promote transparent business practices. It was discontinued at the end of 2015 succeeded by a new Responsible Investment Index established by the JSE in association with FTSE Russell. The aim of the research was to evaluate the share performance of the JSE SRI Index from 2004-2015. Additionally, the indices were categorised by environmental impact to further analyse disparity among share returns. The study was also divided into two sub-periods, 2004-2009 and 2010-2015, with the latter following the endorsement of integrated reporting by the King III Code as a listing requirement in 2010. A single-factor Capital Asset Pricing Model (CAPM) was used to assess differences in risk-adjusted returns. Engle-Granger and Johansen tests were employed to explore the possibility of a cointegrating relationship between the indices. No significant difference between returns was observed for 2004-2009, with the SRI Index exhibiting statistically significant inferior risk-adjusted returns for the latter half of the study. Overall, a significant difference between share returns was found, with CAPM results suggesting that the JSE SRI Index underperformed the All Share Index by -2.33% per annum throughout the time span of the study. Engle-Granger and Johansen test results indicated the existence of a cointegrating relationship over the first half of the study. However, there was no cointegration between the two indices for 2004-2015, which may be attributed to no significant relationship found for the latter years. Results support the notion that investors pay the price to invest ethically on the JSE. Inferior risk-adjusted returns associated with SRI may be a major barrier to its development in South African markets.
- Full Text:
- Date Issued: 2017
- Authors: Cormack, Bradley Alexander
- Date: 2017
- Subjects: Investments -- Moral and ethical aspects -- South Africa , Johannesburg Stock Exchange , Social responsibility of business -- Standards , Social responsiblity of business -- South Africa
- Language: English
- Type: Thesis , Masters , MBA
- Identifier: http://hdl.handle.net/10962/36251 , vital:24532
- Description: Socially responsible investing (SRI) integrates environmental, social and governance (ESG) issues into the investment decision-making process. Growing ESG concerns and the uncovering of corporate scandals have catalysed the substantial growth in SRI portfolios worldwide. Notwithstanding its increasing popularity, barriers to further SRI growth have been identified. Traditional investing practices suggest that theoretically, SRI may underperform conventional investment strategies. However, despite the vast amount of literature on SRI, empirical studies have yielded a mixture of results regarding fund performance. The JSE SRI Index was launched in 2004 to promote transparent business practices. It was discontinued at the end of 2015 succeeded by a new Responsible Investment Index established by the JSE in association with FTSE Russell. The aim of the research was to evaluate the share performance of the JSE SRI Index from 2004-2015. Additionally, the indices were categorised by environmental impact to further analyse disparity among share returns. The study was also divided into two sub-periods, 2004-2009 and 2010-2015, with the latter following the endorsement of integrated reporting by the King III Code as a listing requirement in 2010. A single-factor Capital Asset Pricing Model (CAPM) was used to assess differences in risk-adjusted returns. Engle-Granger and Johansen tests were employed to explore the possibility of a cointegrating relationship between the indices. No significant difference between returns was observed for 2004-2009, with the SRI Index exhibiting statistically significant inferior risk-adjusted returns for the latter half of the study. Overall, a significant difference between share returns was found, with CAPM results suggesting that the JSE SRI Index underperformed the All Share Index by -2.33% per annum throughout the time span of the study. Engle-Granger and Johansen test results indicated the existence of a cointegrating relationship over the first half of the study. However, there was no cointegration between the two indices for 2004-2015, which may be attributed to no significant relationship found for the latter years. Results support the notion that investors pay the price to invest ethically on the JSE. Inferior risk-adjusted returns associated with SRI may be a major barrier to its development in South African markets.
- Full Text:
- Date Issued: 2017
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