Stephen Cranston Associate editor

It would have been so much simpler to use benign phrases such as “socially responsible investments” or “developmental assets”. Instead the ANC has raised the highly anachronistic concept of prescribed assets. Charles de Kock, who now runs absolute return funds at Coronation, joined Old Mutual in 1986 when the old prescribed assets regime operated. It forced pension funds to invest 53% of their new cash flows into either cash or gilts (the old name for government and parastatal bonds). But it never mandated investment in a specific project or organisation. There was a hothouse effect, as no funds could (legally) be taken offshore at that time so equity prices were still high, especially for shares with rand hedges such as Liberty (which included the Liberty Internatiional UK property business and British insurer Sun Life) and Rembrandt, which controlled Rothmans internationally before its overseas holdings were rehoused in Richemont. These two shares often traded on a price:earnings ...

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