Q: KEVIN JAMES: The JSE is obviously the place at the top end of town. These are the biggest companies, the complex organisations where there’s a big struggle to embed sustainability principles from a top-down and a bottom-up perspective. Since the SRI was launched on the JSE over ten years ago, what have been your major successes and greatest challenges?
A: CORLI LE ROUX: It’s been quite a journey with the SRI Index. I think the biggest success is just the way we’ve seen the conversation change. When we started the process in 2002, we had consultations with companies to understand what we would need to look at. We had companies who said “I just burn jet fuel, I don’t have an impact on the environment.” Today those conversations are extremely different.
We have companies almost on a daily basis who want to understand better what it is that they need to do to improve their performance. Not only in the index, but even smaller companies who are not eligible for the index use the criteria as a benchmark to see what it is that they need to be reporting on. So if you take the spectrum of the investment community from the issuers right through to the investors, the issuers are the real success story.
The start of the SRI Index in South Africa was quite unique. In most places around the world where these kinds of indices have been developed, they were spearheaded and driven from the investment community wanting to see greater transparency from the corporates. But in South Africa, the corporates were the ones driving the creation of the index. They were the ones who came to the JSE and said, look we are doing all of these things, there’s all of this pressure on us to disclose more, to do more; how can we demonstrate to investors what we are doing and give them an opportunity to engage with us better and reward us with that? So, while there is still a lot of work for corporates to be doing, I think all of the companies that are in the index deserve to be congratulated for the immense work that they’ve done in growing with the index.
The biggest challenge is getting the investment community on board. When I say investment community, it’s not the investment community as a whole – there are key actors within the investment community that are deeply engaged in the whole debate and that we have ongoing conversations with. The nice thing is that that group of people is also growing. However, there is still a challenge to really get this conversation to become mainstream.