Asset strategy

The JSE has initiated an unclaimed dividends programme

Asset strategy

In 2022, the Financial Sector Conduct Authority (FSCA) published a white paper shedding light on the ongoing issue of unclaimed financial assets in SA. Most notably, the report highlighted the concerning trend of unclaimed dividends, which has stirred widespread discussion both among industry players and the general public alike. According to the FSCA, there is an estimated R88.56 billion of unclaimed assets across the financial sector, with unclaimed dividends making up more than R4.5 billion of this huge figure.

Recognising the evident need for proactive intervention in this issue, the JSE has launched a nationwide initiative, in consultation with issuers, to match claimants with their unclaimed dividends. The National Asset Reunification initiative aims to address the critical issue of unclaimed dividends in the market by identifying and reuniting individuals with unclaimed or ‘lost’ entitlements stemming from limited or outdated information about the owners or holders of shares.

‘The administration of this project will be outsourced to JSE Investor Services [JIS], our subsidiary that is fully equipped to deal with a project of this nature. JIS provides tracing services to their issuer clients and has been successful in paying over R400 million in unclaimed dividends to shareholders; this initiative supplements that effort,’ according to Vuyo Lee, the JSE’s Director of Marketing and Corporate Affairs.

JIS aims to ensure the efficiency of this claimant process by applying a strict multi-step verification process that will be followed by the JIS back office to ensure the correct dividends are paid to the right shareholders. Furthermore, shareholders will be able to speak to a call centre agent to manage the claims process telephonically, with SMS verification and call-back ability. While the JSE is looking at cheaper forms of communications for clients, shareholders will have access to its centralised online portal named ShareHub, where they can update details and upload supporting documents.

‘The National Asset Reunification initiative was launched to the media in February this year, and we’re planning to officially kick off the marketing of this campaign in June with an education drive, followed by a second campaign to attract potential claimants. The JSE aims to educate shareholders or potential shareholders on the investment process and the various market-related terms, such as dividends. This ties into the unclaimed dividends campaign nicely as shareholders will have access to more information before and during the process of claiming their unclaimed dividends,’ says Lee.

To ensure the success of this initiative, the JSE plans to collaborate with other relevant stakeholders, such as regulatory bodies and financial institutions, in implementing this initiative, as the roll-out of the initiative requires the involvement and support of the broader business community and financial markets.

‘The JSE has informed the FSCA on the intention to embark on the National Asset Reunification initiative and they have indicated their support. We are also looking at potential partnerships with banks and other financial services organisations that have systems and processes that we can leverage,’ she says.

‘At the core of driving the South African economy forward, the JSE is dedicated to uncovering the rightful owners of unclaimed dividends. We look forward to collaborating with the market to facilitate this initiative to improve the well-being of individuals, and in turn, to advance our country’s prosperity.’

By Patrick Farrell
Image: iStock