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Russell Loubser: A very good Innings

JSE magazine catches up with outgoing JSE CEO Russell Loubser, who steps down on 31 December after 15 years at the helm of the exchange.

An initial five-year contract has turned into nearly two decades. This is quite long for a CEO and also a large chunk of your professional life. What was it about the JSE that kept you there – and so committed – for this lengthy period?

My intention at first was not to go beyond the five-year contract and those early years were not always enjoyable. There was huge criticism from the financial community and the press – and granted, a lot of it was justified. But that could be very debilitating at times. However, by the end of that first contract term, we were winning a few battles. We could see light at the end of the very long tunnel and, with some personal pride thrown in there, it was too early for me to leave.

Also, I was working with really great people. We all believed the exchange was worth fixing up and that we could make a meaningful difference to the financial markets of SA. And 15 years later, it has been the most enjoyable time of my professional life.

Working in financial markets before joining the exchange and therefore knowing the enormous criticisms being thrown at the JSE from all its stakeholders, what was your mindset and immediate priorities on taking office? Did the task ahead ever seem insurmountable?

Having worked in the financial markets prior to joining the JSE, I came in with a very clear understanding of why the broking community was unhappy with the exchange. At that time the exchange was wholly-owned by them and possibilities like demutualisation and listing were not even remote considerations.

For years I had been working with (and sometimes against) them, and knew their irritations. We had some very tough discussions regarding what needed to be done but not once did I ever think of throwing in the towel. I had a clear picture of what needed to change and, importantly, that these changes could be made. I think it could have been a very different experience and challenge for someone who was not from a financial markets background to head the exchange.

Yet again, SA has been ranked first in the WEF 2011/12 competitive rankings in the Regulation of Securities Exchanges category, way ahead of its developed market peers. With all credit to you and your team over the years, what has put (and keeps) us in first place? And what are your hopes for other African countries regarding the development of their financial markets?

Once again, getting this first-place recognition is great. Our concern with last year’s number one ranking was ‘where do we go from here?’, as the only direction from the top is down.

Pleasingly, we maintained our position. We had been clawing our way up these rankings over the last few years to finally reach first place and did not want to lose it. But, like a batsman, we are only as good as our previous innings and certainly cannot rest on our laurels. We would hope for first place again next year, but no matter where we get positioned, there are things we need to get on with, irrespective of any rankings.

On markets in the rest of Africa, I wish they would move more quickly and lift their game. If exchanges operate more effectively, this benefits our economies and, in turn, our people.

But before SA starts commenting on what’s happening across the continent, we need to look internally and there’s a lot of cleaning up to do in our own country. In the WEF rankings we are close to bottom on the quality of our maths and science education. If we are not willing to settle for mediocrity for our financial markets we must not settle for mediocrity for the country. Mediocrity can be very dangerous.

What were the highs and lows that stand out for you over the past 15 years. What made you really proud and what was frustrating?

As every year went by, we’d accomplish more of our goals and see the genuine difference we were making to the financial markets in SA. This was extremely rewarding. But equally so, there were things we did not manage to achieve or that took longer than we expected. This was frustrating at times.

One thing that should’ve been tackled 10 years ago is the bond exchange. If we had managed to do this sooner, we would be so much further down the line. But with the bond market now firmly part of the JSE after we acquired it in 2009, it’s a priority. For a long time we have needed a transparent and liquid bond market in SA.

Nevertheless, through all the accomplishments and the disappointments of not achieving things more quickly than hoped for, the one constant was a great team and really amazing people.

As you watch from the sidelines going forward from 2012, what direction would you like to see the exchange moving in?

I have full confidence in the team to continue with all the good we have achieved and to take the JSE to even greater heights. On leaving the exchange, I will still have a great appetite for the JSE and our financial markets. In five years time I hope to see an even more advanced, faster and operationally efficient exchange. I wish the utmost best for the JSE and all its employees.

Useful resources:
JSE Magazine
JSE is the official business and lifestyle quarterly of the JSE Limited. JSE also gives you a glimpse into the workings of the exchange and a unique insight into the world of investing.
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