Latest News

The Public Procurement and Asset Disposal Board (PPADB) has appealed a...
Members of the Botswana Sectors of Educators Trade Union (BOSETU) have...
GAPHATSHWA: Death brings everything to a halt, but sudden death as a r...
FRANCISTOWN: The United Nations High Commissioner for Refugees (UNHCR)...

NBFIRA Not Powerful Enough – Study

NBFIRA Not Powerful Enough – Study
The Botswana Institute for Development Policy Analysis (BIDPA) has through its researchers called for a review of laws and regulations to adequately address the issue of ordinary shareholders’ rights.

This was after a study they conducted found that there is an opportunity for expropriation and breach of corporate governance standards by listed companies in Botswana. The study titled ‘Ordinary Shareholders’ Rights Protection in Botswana’ dated March 2020 was conducted by Kelesego Mmolainyane, a research fellow at BIDPA and Ratang Sedimo, who is an attaché.

The Choppies Group was used as the case study following its suspension from the Botswana Stock Exchange (BSE). According to the study, the retail giant failed to comply with corporate governance standards. “Delisting statute within the BSE Listing Requirements states that if a company has been suspended and does not rectify its transgression to comply within six months of suspension, then the Listings and Trading sub-committee can take action to de-list the firm.

To date, more than six months after suspension, it is not clear why Choppies has not been delisted from BSE nor its suspension lifted. Furthermore, the rights of the minority shareholders were not legally protected when the CEO was reinstated by the majority shareholders,” they wrote.

They further state that the losses incurred by ordinary shareholders are therefore taken simply to be part of the inherent risks of stock market investing, even though they are a result of broken ‘rules of the game’ – weak adherence to corporate governance standards by Choppies managers.

The researchers also recommend that there is a need to ensure that non-compliance to requirements is punished

without delay to avoid loss of wealth to shareholders.  They also call for Non-Banking Financial Institutions Regulatory Authority (NBFIRA) with sufficient resources to effectively and efficiently regulate the securities.

The duo concluded that ordinary shareholders’ rights protection involves the use of institutions, legal and regulatory frameworks. “The protection of ordinary shareholders’ rights builds trust and ensures that there is increased participation of different stakeholders in the stock market. This increased participation brings vibrancy to the stock market by improving liquidity. Furthermore, protecting shareholders is usually a function of information disclosure; ensuring that firm managers disclose as much information as is needed for shareholders to make the best decisions concerning their investment,” they wrote.

The researchers found that existing laws in Botswana, both the Securities Act and the Companies Act of Botswana, are important legal instruments towards the protection of shareholders’ rights. However, they say from engagements with industry experts and regulators themselves, it is apparent that the two legal instruments could be amended to add clauses that specifically and explicitly spell out and ensure the protection of ordinary shareholders.

They found that, unlike the NBFIRA, which has a broader mandate of regulating all non-banking financial institutions, the Securities and Exchanges Commission’s role is to be a primary regulator of the securities market.  Moreover, they say the Financial Services Commission of Mauritius and the Financial Sector Conduct Authority of South Africa are independent regulatory authorities.


Banners ?>


Ministry of Sports and Culture

Latest Frontpages

Todays Paper Todays Paper Todays Paper Todays Paper Todays Paper Todays Paper
Adana Escort
Adıyaman Escort
Afyon Escort
Ağrı Escort
Aksaray Escort
Amasya Escort
Ankara Escort
Antalya Escort
Antep Escort
Ardahan Escort
Artvin Escort
Aydın Escort
Balıkesir Escort
Bartın Escort
Batman Escort
Bayburt Escort
Bilecik Escort
Bingöl Escort
Bitlis Escort
Bolu Escort
Burdur Escort
Bursa Escort
Çanakkale Escort
Çankırı Escort
Çorum Escort
Denizli Escort
Diyarbakır Escort
Düzce Escort
Edirne Escort
Erzincan Escort
Elazığ Escort
Erzurum Escort
Eskişehir Escort
Giresun Escort
Gümüşhane Escort
Hakkari Escort
Hatay Escort
Iğdır Escort
Isparta Escort
İskenderun Escort
İstanbul Escort
İzmir Escort
İzmit Escort
Karabük Escort
Karaman Escort
Kars Escort
Kastamonu Escort
Kayseri Escort
Kıbrıs Escort
Kırıkkale Escort
Kırklareli Escort
Kırşehir Escort
Kilis Escort
Kocaeli Escort
Konya Escort
Kütahya Escort
Malatya Escort
Manisa Escort
Maraş Escort
Mardin Escort
Mersin Escort
Muğla Escort
Muş Escort
Nevşehir Escort
Niğde Escort
Ordu Escort
Osmaniye Escort
Rize Escort
Sakarya Escort
Samsun Escort
Siirt Escort
Sinop Escort
Sivas Escort
Şırnak Escort
Tekirdağ Escort
Tokat Escort
Trabzon Escort
Tunceli Escort
Urfa Escort
Uşak Escort
Van Escort
Yalova Escort
Yozgat Escort
Zonguldak Escort
Alaçatı Escort
Aliağa Escort
Alsancak Escort
Bornova Escort
Buca Escort
Çeşme Escort
Çiğli Escort
Gaziemir Escort
Karşıyaka Escort
fethiye escort
iskenderun escort
iskenderun escort
iskenderun escort
iskenderun escort
iskenderun escort karataş escort ceyhan escort ankara escort etimesgut escort çankaya escort altındağ escort mamak escort keçiören escort