.B.B.B.E.EB.B.B.E.E IS THE WAY FORWARD…

BEE has been on the agenda of government since 1994. The detail for implementation is to be found in Codes of good Practice which were gazetted in February 2007. The aim of BEE has always been to redress the economic exclusion of the majority of South Africans, by doing that it was believed that a more evenly shared & stronger economy would be created and this would lead to job creation.

an introduction to B-BBEE

AS FROM THE 7TH OF December 2011 the government came up with a law that states that all business should have a BBBEE certificate. Therefore when applying for government tenders and Data Base application or even to show your suppliers that you are BEE compliant, which is very important.

Having a BEE certificate as become one of the requirements in doing business in South Africa. This is a very smart way used to get and encourage South African Businesses to become BEE compliant (having a BEE Certificate), therefore all businesses in S.A who gets a BEE certificate will need their supplier’s BEE certificate.

THE IMPORTANCE OF BBBEE

 GOVERNMENT

Supplier A SUPPLIER B SUPPLIER C

Exempted Micro Enterprise QUALFYING SMALL ENTERPRISE GENERIC

Level 3 LEVEL 4 LEVEL 6

IMPORTANCE OF BBBEE

It has been said that, “B-BBEE legislation is the most significant piece of legislation affecting South African business today.”

The Broad-based Black Economic Empowerment Act, Act 53 of 2003 (“B-BBEE”), affects all business and individuals in South Africa. It is not just vital for the country’s integrated prosperity but a catalyst for economic growth.

How will BEE affect me?

There are Benefits of having a BEE certificate for your company, you will received more value adding goods and services, decrease crime by employing more people (skills development) and training in productive activities, also you are able to the Global Market.

BEE can be used as a marketing tool for your company. As a client of BEE EMPOWERED, your company’s name will be listed on our website’s BEE Directory and will be available to all those searching for BEE compliant suppliers.

How will BEE affect me?

Exempt Micro Enterprise (EME). Below 5 million. White owned level 4 & black owned level 3.

Qualifying Small Enterprise (QSE) Above 5 million but below 35 million. 4 elements

Generic (Above 5 million). 7 elements

TYPES OF BBBEE SCORECARDS

The nature of your businessArchitectureEngineeringLandscape surveyorsQuantity surveyorsTown & Regional planners

BEP’s (Built Environmental Professions)

Exempted Micro Enterprise . (EME below 1.5 million) White owned level 4 and Black owned level 3

Qualifying Small Enterprise. (QSE above 5 million but below 11.5 million) 4 elements

Generic (exceed 11.5 Million) 7 elements Should you fall under the Qualifying Small

Enterprise or Generic category then you will need to be compliant on the following elements

BEP’s SCORECARDS

1. Ownership2. Management control3. Employment equity4. Skill development5. Enterprise development6. Socio economic development7. Preferential procurement

7 ELEMENTS

I will be explaining the seven elements of the B-BBEE Scorecard, which are Ownership, Management, Employment Equity, Skills Development, Preferential Procument, Enterprise Development and Socio Economic Development. I hope that this will assist you to comprehend the elements of the Scorecard and helps you to know what needs to done in order to Score good points from these elements.

BUSIE INTRODUCTION

The objective of this element is to expose Black people to the economic Substance of ownership, and we also look on the number of shares that are in the hands of Black people.

Ownership Element measures the effective ownership of enterprise by black people

“Black people is defined as Africans, Colored's and Indians who are South African Citizens.

OWNERSHIP

The ownership Element is about sharing the economic fruits of the country with Black people , but it is also about sharing the knowledge and successful ownership with Black people though exposing them to active participation in ownership.

There are two components in ownership: Voting rights and economic interest in the hands of Black South African Citizen people.

CONTINUATION OF OWNERSHIP

This element measures the effective control of enterprises by black people

Top management(Senior Management) in the company are the employees of the measured entity who serve on the Broad over and above their additional responsibility of providing leadership and managing day-to-day operations of an enterprise.

Only Black employees that are considered under Top management. Like executive officer, chief operating officer Head of Sales, Head of Public Relations ect.

Bonus Points are awarded for 10% holding of Economic interest by Black women.

MANAGEMENT CONTROL

This element is trying to redress the imbalances of the past by increasing participation & equitable representation of suitable qualified Black employees in general and Black employees with Disability.

Employment Equity role in B-BBEE is to promote diversity & equitable representation of Black employees in workplace which should reflect the demographic of country in terms of race.

Increase employment opportunity of all suitable qualified Black employees in Senior management, Middle Management and Junior Management

EMPLOYMENT EQUITY

We look on South African Black people who are under Management (Senior management, middle Management and Junior Management)

Look for the overall employees of the company as a percentage of all employees using the Adjusted Recognition of Gender.

At least 40% of Targets must be meet from all indicators under Employment Equity Element.

Continuation of Employment Equity

Skills Development addresses the skills shortage challenges & encourages development of core, Critical & scares skills among Black employees

To support economic growth that result in employment creation & poverty eradication

QSE 2% OF their Skill Leviable amount, Generic 3% of Leviable amount.

SKILLS DEVELOMENT

Training can be either Internal Training, External Training and Learnerships.

Generic companies needs to be registered with the applicable SETA and they must have developed Workplace Skills Plan

And they implemented programmes targeted at developing Priority skills generally, and specifically for Black employees

For QSE company they need to have 12 months EMP201’S submitted to SARS within their period of Financials.

Continuation of Skills Development

This element measures the extent to which enterprises buy goods & services from suppliers with strong BBBEE procurement recognition level.

The BEE Act does not place a legal onus on all businesses to comply with its provisions. It places a legal onus on organs of state and public entities to contribute to BEE, but not on private sector companies

PREFERENTIAL PROCUREMENT

Preferential procument carries one of the highest points on the Generic BEE Scorecard(20)

To achieve points, entities must buy or procure from companies with a favorable BEE status; otherwise the tender will favor competitors who offer a better BEE Status

Generic Companies also need to procure from QSE and EME companies that are more than 50% Black owned and also to measured entity that are 30% Black women owned.

Continuation of Preferential Procument

Examples: providing houses gives people a platform for organizing their lives and for launching economic activity.

Providing people with food gives strength to participate in the economic activities.

Monetary or non- monetary contributions The objective of the contribution must have

been to provide sustainable access to the economy for the respective beneficiaries.

The measured entity need to spend 1% on NPAT.

Continuation of Socio Economic Development

This element measures the extent to which Enterprises carryout initiatives intended to assist & accelerate the development & sustainability of other Enterprises.

The contribution to Enterprise Development must be something that will assist the ultimately Black owned enterprises in developing its operational and/ or financila capacity.

QSE contribute with 2% and Generics contribute with 3%

ENTERPRISE DEVELOPMENT

PointsLevel 1 > 100 > 135%Level 2 > 85-100 > 125%Level 3 > 75-85 > 110%Level 4 > 65-75 > 100%Level 5 > 55-65 > 80%Level 6 > 45-55 > 60%Level 7 > 40-45 > 50%Level 8 > 30-40 > 10%Non compliant <30 > 0%

DIFFERENT SCORES

From now on make sure that your suppliers are at least 51% black owned & also 30% female black female ownership it’s very important, you may not see the need for that now but one day you will……..

CONCLUSION

QUESTION AND ANSWERS