FINANCIAL SERVICES
ONCE EMPOWERED...
One of the challenges that stalled implementation of a final Code was disagreement on the concept of ownership, especially the
principle of “once empowered, always empowered”. This principle deals with the question of what happens to the rating of a company
if black investors lose or sell their shares.
Coovadia notes that it has been agreed in the new Financial Sector Code that if dilution of black ownership occurs as a result of an
institution raising capital for regulatory reasons, “once empowered, always empowered” will apply. If dilution of black ownership occurs
as a result of black shareholders selling their shares to white p