An analysis of director interlocks on the Johannesburg Stock Exchange

Director interlocks, which occur when companies have directors in common, have concerned shareholders, the public and legislators since the early 1900s. The purpose of this paper is to analyse the interlocking directorships of the Top 40 companies listed on the Johannesburg Stock Exchange using small world theory and compare the results to research on interlocks in Italian, French, German, United Kingdom (UK) and United States (US) companies. South Africa was found to be closest to Italy, between the low-density models of the UK and the US, and the significantly higher-density models of Germany and France. This suggests that rather than just the two models (low density and high density), there is a continuum currently reflected with the UK and the US at one end, then South Africa and Italy, and then France and Germany at the other end. The presence of directors with multiple directorships indicates that the threats and benefits associated with multiple directorships may exist in South Africa.