This study investigated the nature of institutional shareholder activism in South Africa with a particular focus on proxy voting as a public form of shareholder discontent. A total of 24 510 votes cast by 17 local investment management companies in 2013 were analysed. Interviews were also conducted with selected investment managers to gain more insight into the proxy voting process at their companies. Based on this data, it was concluded that investment managers preferred to engage with investee companies in private and viewed proxy voting as the last link in the shareholder activism chain. As a result, only 6.6 per cent of all votes were 'against' resolutions tabled by 347 JSE-listed companies in 2013. Resolutions regarding shareholders' endorsement of companies' remuneration policies; the election and re-election of directors, particularly those serving on audit committees; and the issuance of ordinary shares elicited the most opposition. Companies that were excluded from the JSE's Socially Responsible Investment Index in 2013 attracted significantly more opposition than their counterparts who were included in the index when seeking shareholder approval on the election and re-election of directors and the placing of shares under the control of directors. The same applied to companies that had low environmental, social and governance disclosure scores in 2013 as regards the issuance of shares. It is recommended, amongst others, that shareholder activism in South Africa be promoted by enhancing investor education and effecting some regulatory changes.

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Although statistical evidence seems to be lacking. it is at present widely acknowledged that organisational culture has the potential of having a significant effect on organisational performance. An analysis of sustained superior financial performance of certain American organisations has attributed their success to the culture that each of them had developed. It has been proposed that these organisations are characterised by a strong set of core managerial values that define the ways in which they conduct business. how they treat employees, customers, suppliers and others. Culture is to the organisation what personality is to the individual. It is a hidden but unifying force that provides meaning and direction and has been defined as the prevailing background fabric of prescriptions and proscriptions for behaviour, the system of beliefs and values and the technology and task of the organisation together with the accepted approaches to these. Recent studies have indicated that corporate culture has an impact on a firm's long-term financial performance: that corporate culture will probably be an even more important factor in determining the success or failure of firms in the next decade; that corporate cultures that inhibit long-term financial performance are not rare and that they develop easily. even in firms that are staffed by reasonable and intelligent people; and that corporate cultures, although difficult to change, can be made more performance enhancing. The purpose of this study, therefore, was to establish the statistical relationship between organisational culture and financial performance.

Objective:The research objective was to test the hypothesis that corporate health and wellness contributed positively to South African companies’ financial results.Methods:The past share market performance of eligible healthy companies, based on Discovery's Healthy Company Index, was tracked under three investment scenarios and compared with the market performance on the basis of the JSE FTSE All Share Index.Results:The evidence supports the hypothesis that a culture of health and wellness provides a financial advantage, in so far as the portfolio of healthy companies consistently outperformed the market over the selected simulations.Conclusions:Given the limitations of the investigation, namely small sample size, the brevity of the period of investigation, and the reliance on accessibility sampling, the research provides the first and preliminary evidence supportive of the direct financial benefits of companies’ wellness programs.

Seasonal patterns in the South African capital market In this article the seasonal patterns in daily price movements of the Post Office, Eskom 168 and the RSA bonds are examined and these are compared with three equity indices namely the Gold Index, Industrial Index and Overall Index of the Johannesburg Stock Exchange. Both the South African bond and share markets display significant seasonal patterns. In contrast with international findings, it is shown that seasonal similarities exist between the bond and share markets.

Investor relations is the field of management that is concerned with the relationships between companies and investors, and as such involves a wide variety of information types, for example mandatory, voluntary, financial, non-financial, qualitative and quantitative. While South Africa has recently been ranked number one for the strength of its auditing and reporting standards for the seventh consecutive year (IRBA, 2016), investor relations as a wider and voluntary concept, is largely unresearched in South Africa. The purpose of the study was to establish the determinants of Internet investor relations (IIR).The quality of IIR was measured for a sample of 85 JSE-listed companies using a measurement instrument that consists of 346 attributes. From the literature, as discussed in the literature review, 15 company characteristics were identified that could explain IIR quality. Stepwise regression model-building was used to develop a regression model that best explains IIR quality.Company size, leverage, being audited by a big four audit company, JSE industry membership, free float and dual listing status were found statistically significant independent variables, explaining 68.76% of the variation in the dependent variable, IIR. Contributions to the body of knowledge, study limitations and the need for further research are discussed in the conclusion.

Background: Information asymmetry manifests when one party has more or better information than the other. Information asymmetry is said not only to increase transaction costs and decrease liquidity, but also to diminish the quality of the investment decisions taken by investors, thus weakening the overall functioning of markets. Aim and setting: A well-developed Internet investor relations (IIR) strategy, coupled with increased disclosure levels, should theoretically decrease information asymmetry levels. The majority of related studies to date used either an indirect disclosure proxy or involved an examination of the annual report, and have used data from United States or European companies. Empirical studies to date have produced mixed results. The aim of this study was to ascertain whether a relationship exists between the quality of IIR (via corporate websites) and information asymmetry. Method: This study used data from Johannesburg Stock Exchange (JSE)-listed companies. Multiple regression analysis was applied with information asymmetry as dependent variable and IIR as one of a set of selected explanatory variables. A self-constructed measurement instrument was used to measure IIR for a sample of 85 companies. Given the inherent difficulty with direct observation of information asymmetry, three different proxies were used to estimate information asymmetry. Results: A significant negative association was found between IIR and information asymmetry for all three information asymmetry proxies that were used: bid-ask spread, price impact, and analyst following. Conclusion: Empirical support is provided for the notion that companies may potentially benefit from a well-developed IIR strategy through reduced information asymmetry.

PurposeThe purpose of this paper is to examine the effects of generic medicine competition on the market share growth and pricing of originator brand medicine in the South African private pharmaceutical market.Design/methodology/approachRegression analysis is applied to market share data of originator brand drugs that have been exposed to competition from generic substitutes, based on an agency model of the prescribing physician, the pharmacist or the medical scheme.FindingsThe results indicate that the price of an originator brand medicine relative to the weighted average price of its generics has a significant negative impact on the change of its market share. Investigations into the prices of the originator brands, in relation to the number of generic equivalents in the market, indicate that the number of generics available in a specific market has a significant positive impact on the relative price of originators, thereby making originators relatively more expensive compared to their generic competitors. At the same time, the results show that the absolute price of the originator brand medicines declines as the number of generic equivalents in the market increases.Practical implicationsThe results indicate that, for all modules pooled together, the relative price of the originator product to that of the generic equivalent, is responsible for a significant reduction in the relative change in the market share of the originator medicine. When analysed on the level of anatomical class, or the individual molecule, results are not consistent. For affordable healthcare, the results support the reduction in barriers to entry for generic medicine. Furthermore, the results support education and incentives for doctors, pharmacists and end‐users to develop generic alternatives as trusted brands in their own right.Originality/valueThis study quantitatively assesses the effect that generic medicine competition exerts on the market share of originator medicines in South Africa.