1.1 Background to this paper The history of the JSE Securities Exchange of South Africa (the JSE) dates back to the year 1887. The JSE was founded to enable financiers to raise funds for the expansion of the fledgling mining industry in Johannesburg. Murray (1987) argues that the JSE reflects the riches of the gold mining industry as was the case in the late 1800s. For example, current top ten companies as measured by market capitalization are predominantly mining companies.

“From its establishment in 1887 to modern day, the JSE has played and continues to play a vital role in the commercial and economic development of the Republic of South Africa. The JSE stands high as the engine-room of the South African economy. Companies listed on the JSE create a sizeable part of South Africa’s economic activity. Companies across the range of industry and commerce meet to raise the public capital needed to expand their businesses. In doing so, they create new jobs, products, services, wealth and economic opportunities”(JSE, 2005). Securities exchanges have consequently