Browsing by Author "Thurner, Thomas"

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    Corporate governance in South Africa : the role of institutional investors
    (2015) Bhikha, Vishal; Thurner, Thomas
    Corporate governance has become the slogan of the global investment arena over the past decade. Corporate scandals and collapses with major loss to shareholders have noted a change in investors' attitude towards this topic. Corporate governance has not only become important for the survival of companies in the global economy, a set corporate governance framework too is required to merely attract capital for start-ups. This study focuses on the institutional investors in South Africa, and their attitudes towards current corporate governance standards in South Africa, and attitude to governance reform. The aims of this study: * To accentuate the significance, features and benefits of corporate governance in light of the empirical analysis; * To understand South African institutional investor environment better, and their monitoring and participating roles in corporate governance for investment in listed corporate entities; * Review the key criteria factored into investing, and how these are monitored on an on-going basis. Corporate governance criteria in specific was used; * Highlight the attitudes of South African institutional investors to corporate governance in South Africa, and their perception on corporate governance reform; * Review weakness in findings in light of the empirical study and analytical framework and summarise recommendations given the outlook for this sector. We introduce the topic of corporate governance and the concept of agency theory which highlights the reasons behind opportunistic behaviour which occurs at different levels within corporate organisations. We further discuss the change in attitudes of institutional investors on the back of corporate scandals, as well as the reasons and remedies of institutional activism. A background of South African institutional investors is also conducted, with a review of current legislation and corporate governance reform mechanisms applicable to South Africa. Following this is a broad literature review on the quantitative as well as qualitative information needs of institutional investors; this forms the basis for the structure of our questionnaires conducted. The last section draws on the critical findings and insights (including quotes from the interviews) on the role of institutional investors in South Africa, followed by the summary and limitations of this study.
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    Optimal capital structure and share repurchases: a case study of Anglo American Plc
    (2016) Chadderton, Marcus; Thurner, Thomas
    During 2006, AAL adopted and implemented its first share repurchase program, which continued up until its suspension in 2008. While management stated that share repurchases would only be done in the interest of shareholders, the repurchase program was disastrous for shareholder value. Management also stated that share repurchases provide the firm with flexibility regarding its capital structure. We investigated the capital structure of AAL for the years 2004 to 2012 from an optimal capital structure perspective. Using a CAPM approach, we find no evidence that AAL targeted or implemented a capital structure, which could be considered optimal.
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    A Shariah compliant private equity fund : compatibility in South Africa
    (2015) Cajee, Mohsin Ebrahim; Thurner, Thomas
    There is no doubt that the equity market plays a central role in the growth and the sustainability of an economy. Equity and capital markets allow companies to access increased levels of accessibility to capital. Besides the traditional models to access for corporate finance, new opportunities have appeared which offer interesting alternatives. The accumulated wealth from the Islamic community became accessible through new vehicles, built on the Islamic Shariah laws in as far as money and banking is concerned. The Islamic concepts of money and banking, emphasise the relationship between profit and risk as well as responsibilities of institutions and individuals. Many of the guiding principles of corporate finance and banking would not be pegged on religious provisions and doctrines. The Western, conventional economic system holds opposing views to Islamic economics and a key question arises, could principles of Islamic finance feed into a Western economic system and be maintained on a sustainable basis? Proponents and supporters of a Shariah compliant economic system argue that religion is meant to affect every other aspect of life and so would be the economic principles one stands for. As such, remaining committed and observing Islamic law in business and economic activities would be inevitable for all those who take pride in prophesying the Islamic faith. More recently, regulators in South Africa have taken a number of steps to promote Islamic finance in South Africa. The country has one of the more efficient and advanced financial systems, legal and tax frameworks as well as governance structures and regulations on the continent. This gives South Africa a competitive edge and first mover advantage over other African countries in promoting and advancing the Islamic finance industry. The main goal of this mini thesis is the study of what constitutes an Islamic Shariah compliant Private Equity Fund (IPEF). At a secondary and more basic level its viability is considered within a South African context. It also examines the key challenges and potential solutions for such a fund to exist in an economy based largely on Western principles, particularly with reference to the legal frameworks, interest treatment, taxation laws, regulatory and supervisory bodies as well as basic conceptual understandings. Of great attention to the researcher would be the differences between the conventional economic principles that guide equity and finance in South Africa and how Shariah compliance has affected the trade instruments. The author of this thesis has vast experience in the area of Private Equity and Islamic finance as it pertains to this field. In this work, the author builds on his own experience and critically reflects it against the dominant literature in the field. This work does not focus on the risk/return profile or provide any consideration as to the likely performance of such Islamic Private Equity Funds.