The 129-year-old JSE is showing the way, outshining other organisations by surpassing the 50/50 gender parity goal. In an exclusive interview, we chat to the stock exchange’s youngest (and first female) CFO, Aarti Takoordeen (36) about her responsibility as a Young Global Leader, growing the economy and eradicating gender inequality in the financial sector.
More than 50% of both the JSE Board and Executive are women. Who is driving gender transformation at the JSE and what needs to happen to speed up the pace in South Africa?
At the JSE, we believe that having women at all levels should become the norm. Organisations should create the right platforms to afford women employees the same opportunities to grow as their male counterparts. This includes creating a conducive environment for them to prosper. Compared to most companies, the JSE is unique in its representation of women at the most senior level. Out of our 490 employees, 248 are women (51%) and six out of 11 executives are women (54%).
In 2015, the JSE introduced a rule requiring issuers to have a policy for the promotion of gender diversity at board level and disclose their performance against it. It’s only been operational as of January 2017, so the impact is not yet measurable. Our SRI Index, replaced with the FTSE/JSE Responsible Investment Indices, includes qualitative and quantitative indicators based on global best practice, including the number and percentage of women on the board, disclosure of an equal opportunity policy, actions to improve workforce diversity, end discrimination and commitments to gender diversity at the board level.
The resilience of our financial institutions is one of the reasons investors turn to South Africa. What measures are in place to continue building this strength and sustainability?
For capital markets to make a meaningful difference to economic growth and development, we must be truly inclusive in our approach. For us, this means using our core business strengths in a manner that positively impacts the growth of the economy and the transformation of the financial services ecosystem. We do this by ensuring that the JSE listings requirements enable small- and medium-sized entrepreneurs to come to the market.
In this regard, we created our small cap market, AltX more than 10 years ago. We’re currently developing Umnotho, a market for SMEs smaller than those listed on AltX. Our vision is that Umnotho will offer SMEs access to capital and a support structure comprising mentors and training to give them the best chance of sustainable growth. This will offer ordinary investors an accessible way to invest. We’re also committed to growing the financial services ecosystem, like our Black Stockbroker Enterprise Development Programme, that supports the sustainable development of our black stockbrokers. The JSE is a member of the African Securities Exchange Association that promotes Africa as an investment destination.
How has technology affected the way the JSE does business?
Technology is at the heart of everything we do at the JSE. Like most stock exchanges, we are a fully-automated electronic market place. What sets us apart is that we offer investors access to a broad range of markets and service offerings, using technology to create market places that our clients can trust. As the technology landscape evolves, it is incumbent on us to unlock more opportunities. One of our recent technology projects was the successful launch of a shorter three-day settlement
cycle, known as T+3. It reduces the settlement cycle (the time between when a share is traded to when money and shares exchange hands) from five days to three days. The project was extremely well received by the financial markets and our clients, and it aligned the JSE to international best practice. Since we launched T+3 settlement cycle, there have been zero failed trades. This is considered unprecedented globally.
The JSE is a level 2 B-BEE contributor. What role does this play in transformation?
The JSE supports the transformation of the South African economy to better reflect the society in which it operates. As a contribution to this process, we have proposed that companies must disclose the racial diversity of their boards and policies when listing. This will ensure that companies are more transparent about their efforts towards transformation. The focus for disclosure is at board level, given the exchange’s mandate.
In a continuation of this journey and as a clear demonstration of our commitment to broad-based transformation, we’ll amend our Listing Requirements even further to ensure that listed companies have a policy in place to promote race diversity at board level. Listed companies are also required to publish their B-BBEEE scorecard on their company websites and announce it on the stock exchanges news services (SENS). Last year, we launched the Enterprise Development Programme, targeted at helping emerging black stockbroking firms to grow. In 2016, we paid R6-million to qualifying black stockbroking firms. This equated to 33% of the JSE’s equity trading and membership fees that brokers pay to the exchange on a quarterly basis.
What is your role and responsibility as a Young Global Leader?
The Forum of Young Global Leaders is a unique global network of peers from diverse backgrounds and fields with a highly visible opportunity to significantly impact world affairs and shape the global agenda. In my five-year period as a Young Global Leader, I hope to make South Africa a better place. Economic redistribution and growth, poverty alleviation and education are my impact themes to explore during my time as Young Global Leader.
In his new book – Chief Value Officer – Mervyn King describes the crucial role of accountants in adding value and saving the planet, and in it he quotes you – please elaborate.
Mervyn quoted me as follows: “In this age of dramatic distraction, disruptive technology, increased globalisation and a tough economic climate, businesses have come under serious pressure to grow while keeping costs down. CEOs come under competitive threats like never before and are required to respond appropriately. As such, they look to their finance counterparts for a very different output compared to a few years ago. Finance professionals are no longer expected to be back office number crunchers, but rather value-adding business partners.”
How do you contribute to thought leadership?
As a business leader in South Africa, I believe it’s required of me to make a positive contribution towards actionable solutions to the challenges of our country. As an example, I’m passionate about creating an impact on transformation in South Africa, and hold myself to account in my daily business and personal actions. More recently, I put my hand up to increase awareness of the gender inequality issues we face in business to help alleviate this very real challenge. I serve my profession through working with a number of organisations, like SAICA, business schools, universities and CFO forums. I also coach a number of young chartered accountants on an informal basis.
Your advice to young, aspiring business leaders?
Every young, aspiring leader looking to enter the business world must break the mould of traditional business partners while remaining relevant within the global context of business.