File photo of Johannesburg Stock Exchange in Sandton. Image: Thobeka Zazi Ndabula.

Black investors hold similar stakes in listed companies as white investors and this shareholding is expected to significantly grow, according to research released on Thursday.

The third annual study, commissioned by the JSE, looks at ownership of the top 100 listed companies.

“This year's study found a similar participation level among black and white South African investors - 21 percent and 22

percent of the Top 100 by value respectively,” JSE CEO Nicky Newton-King said in a statement.

Researcher Trevor Chandler said the proportion of wealth attributable to black investors would grow over time.

“Typically, the average age of black participants is younger than the average age of white people,” he said.

People were likely to join a pension scheme when they first started working, with life insurance and unit trusts following later in life.

“As people are employed longer, they accumulate more value,” he said.

This meant that even if the number of black participants stayed the same, and no new black economic empowerment (BEE) deals were announced, their share of the JSE could increase in value.

One large pension fund surveyed by Chandler had grown its black ownership from 40 percent last year to around 42.5 percent, although the number of black participants had not changed, he said.

Asked whether there was still a need for BEE deals, Chandler said it was important to understand the impact of such deals.

“When one does a BEE transaction, it's often subsidised. So one question you might want to ask is who is subsidising who,” he said.

Frequently, large institutions offered preferential financing to black investors, which was effectively a subsidy.

Most investors on the JSE were employees who invested through pension funds and the like. Ordinary people were subsidising BEE transactions.

In previous years, BEE schemes were dominated by a few well-placed individuals, but were now more broad-based.

As a result, community groups were benefiting.

“You can draw your own conclusion from that,” he said.

Total black shareholding in South Africa's largest companies rose to 33 percent if the methodology allowed by the BEE codes of good practice was applied.

The codes of good practice govern BEE in sectors without an industry-specific charter.

“This is principally due to the fact that listed companies who own businesses in multiple countries are allowed to exclude the value of these foreign business operations from the calculation of black economic interest,” said Chandler.

Foreign investors hold 34 percent of the market, while a further two percent is held directly by the government.

Most shares - 40 percent - are owned by institutional investors such as pension funds and life insurance companies, according to the research.

Only 24 percent of shares are held directly by South African individuals.

By excluding foreign and government stakes, the proportion of black investors in the remaining categories can be calculated.

This year's study had been more comprehensive than in the past two years, accounting for an increase in the numbers of black investors, said Chandler.

Over 80 percent of target companies had now been surveyed.

He declined to put a value on total black shareholding, as share and exchange values changed daily and the JSE's biggest companies had multiple listings across the world. -Sapa