Search Results

SA Government | 1 August 2023 Consider employing people with disabilities –CEE Chairperson. The Chairperson of the Commission for Employment Equity (CEE), Tabea Kabinde told the gathering that transformation in the workplace has been very slow for the designated groups, and even more so for the Persons With Disabilities (PWD), where change has hardly taken place. Kabinde was addressing the Employment Equity roadshow held at Diep in die Berg Conference centre in the east of Pretoria today. “Out of 27 532 reports received, covering a total of 7 215 960 employees, only 1,2% are persons with disabilities. We are now stretching it to only 2 percent as a proposed target. Please do not overlook persons with disabilities,” Kabinde said. The chairperson told the gathering that whilst there are employers who are transforming their workplaces in terms of hiring PWD, very few go beyond the 1.2 percent. She said there must be a demonstrable commitment to employ those with disabilities. Kabinde told the roadshow that any person can earn the status of disability due to an accident or illness and ‘this does not mean the end’. On the issue of sector targets, the CEE Chairperson told the meeting that a lot of noise in the media is created by misunderstandings. “When we start fighting, we forget that we are talking about the Economically Active Population (EAP). The EAP focuses only on people who are working, looking for work and are employable”, she said. She told the workshop that it cannot be that a group with a small EAP continues to occupy top management level posts whereas, the racial groups with a higher percentage of the EAP occupies a small fraction of those top management posts. She said this is not possible, “unless we argue that Africans are stupid to occupy top management positions”. “What we are saying is simple, please employ suitably qualified people to those positions.” Conducted under the theme: “Real transformation makes business sense”, the Employment Equity Roadshows by the Department of Employment and Labour in collaboration with the Commission for Conciliation, Mediation and Arbitration (CCMA) are working to create awareness on the recently promulgated EE amendments, sector targets and regulations. The workshops further aim to deal with the impact of employment equity in the labour market; by sharing the results of the 23rd CEE Annual Report. Part of the session is also spent on a demonstration of the online EE system with the incorporated amendments to reporting on the system and how certificates of compliance will be generated. There is also a presentation of the CCMA’s case law related to EE, professionally done by a Commissioner from the CCMA. The national series workshops/roadshows started on 18 July and will conclude on 29 August 2023. The remaining August workshops are as follows: Gauteng Johannesburg (02 August 2023) Mpumalanga Witbank (Emalahleni) - (15 August 2023) Nelspruit (Mbombela) – (16 August 2023) Western Cape George (15 August 2023) Cape Town (16 August 2023) Eastern Cape Gqeberha (22 August 2023) East London (23 August 2023) Mthatha (24 August 2023) Free State Welkom (22 August 2023) Bloemfontein (23 August 2023) KwaZulu-Natal Durban (29 August 2023) The EE workshops are targeted at Employers or Heads of organisations, Academics, Assigned Senior Managers, Consultative forum members, Human Resource Practitioners, Trade Unions, employees and other interested stakeholders. The national workshops are from 10:00am to 14:00pm covering all provinces and members of the media are invited. Enquiries: Teboho Thejane Cell: 082 697 0694 E-mail: Teboho.Thejane@labour.gov.za(link sends e-mail) ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.gov.za/speeches/consider-employing-people-disabilities-%E2%80%93cee-chairperson-1-aug-2023-0000

Nathaniel Lee | 2 August 2023 Government advised to take education, skills training seriously to correct wrongs of the past. On Wednesday, the DA led a march through Cape Town to protest against the signing into law of the Employment Equity Amendment Bill, which contains measures that purport to promote diversity and equality in the workplace. The bill was assented to President Cyril Ramaphosa in April and inter alia seeks to pave the way for the minister of employment and labour to identify and set employment equity numerical targets for each economic sector. According to the bill, employers with more than 50 employees must consult trade unions on the said employment targets. It also requires that all salaries and wages be bench-marked according to job descriptions. The DA has referred to it as “race quotas” legislation and has argued it will worsen racial tensions in the country. DA leader John Steenhuisen asserted: “You are going to see companies that would ordinarily look at expanding, narrowing and keeping their workforce down.” He added that the bill would cause incredible harm to the economy. The ANC and Good Party have accused the DA of not having regard for past injustices, playing divide and rule and also seeking to drum up support ahead of the 2024 general elections. The new bill seeks to amend the Employment Equity Act of 1998 which sought to advance the transformation of the South African workforce by setting equity targets, which it is hoped will ensure equitable representation of suitably qualified people from historically disadvantaged groups, based on race, gender and disability, at all levels of the workforce. The added requirement of the bill is that companies seeking to do business with the state will be required to submit a certificate from the department of labour to confirm compliance with the act and its objectives. This means labour inspectors would carry out inspections at workplaces and issue compliance orders in an effort to enforce compliance. Twenty-five years after the passing of the initial legislation, it is pertinent to assess the efficacy of the act. What becomes evident is there has been negligible progress towards addressing systemic inequalities. It is therefore doubtful whether the firming up of the regulatory landscape through the amended bill would bring the desired results through social engineering. The pitfalls of race-based policies of the apartheid era cannot be fixed by the introduction of more race-based policies, which would arguably amount to reversing discrimination. According to labour law expert Michael Bagraim, the government must look at other ways of correcting the wrongs of the past. His advice is for it to take education and skills training seriously if it wants to address the country’s skewed labour market. “The only way you can do it is to improve education, in particular education of people who were previously disadvantaged. “Now the education is completely broken, and it has led to a situation where you have got more white managers than black managers, has led to a situation where you have got more men than women. But you cannot fix something by using something that is social engineering.” The DA Western Cape leader Tertius Simmers weighed in on the debate by stating that the bill would do the opposite of what the government claims it will, warning that 600,000 people would lose jobs through this amendment. According to official figures, the unemployment rate only affects 9.5% of the white population while almost one in two black South Africans were unemployed in the first quarter of this year. In his book, Architects of Poverty, Moeletsi Mbeki argues that the high standards of living of the majority of whites in SA was achieved by the creation of an artificial scarcity of skilled manual labour and professionals, which is what gave rise to job reservation. He then suggests that the country do the opposite if it is to develop – which is to create an overabundance of artisans, technicians, professionals and managers. This can only be achieved in the long term by a massive educational drive that actually produces qualified people, especially scientists and engineers. Independent political and economic analyst and advisor Frans Cronje also notes that employers in SA are nervous of hiring workers because of the destructive behaviour of many trade unions and because of the risk and administrative burden associated with South African labour laws. It is clear that knee-jerk tampering with labour legislation can only lead to pauperisation of the black population which legislation such as the Employment Equity Amendment Bill purports to redress. The improvement of the quality of education in SA is imperative towards the reduction of the workplace inequality gaps, the removal of racial tensions and resentments, and the normalisation of South African politics. ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.sowetanlive.co.za/opinion/columnists/2023-08-02-nathaniel-lee--will-employment-equity-amendment-bill-reverse-workplace-discrimination/

Q | Is the Workplace Skills Plan or Annual Training Report mandatory at a B-BBEE verification for QSEs? A | It is mandatory for B-BBEE purposes when a QSE reports in line with the Skills Development Act or Skills Development Levies Act. Skills Development Services are available to assist members with assembling a Workplace Skills Plan and Annual Training Report.

Core to the Net Value calculation is the Graduation Factor formula that awards 8 points on the Ownership scorecard. The time-based graduation factor reduces, over time, the level of debt attributable to the economic interest held by ‘Black’ Participants. Q | To earn the points available, when is the first-year repayment of the 10% target to claim Ownership by using the Graduation Factor formula payable? A | A `year’ is not defined in Schedule 1; therefore, it takes on the ordinary meaning of 12 months commencing on the first day of the first month and ending on the last day of the 12th month. As such, the 10% target for the first year commences on the first day that all rights and obligations in Ownership become enforceable. The intent is to ensure that there is always value in the hands of ‘Black’ Participants, from day one, before awarding Net Value points. It is for this reason that entities offer ‘Black’ shareholding at a discount. Ownership Services are available to assist with an analysis of Ownership transactions.

Bizcommunity | 1 August 2023 South Africa has a youth unemployment problem. The current rate is at an all-time high of 32.9% with no turning point in sight. This trend is driving many young South Africans to consider self-employment and starting their own business as a possible option. Starting your own business isn't easy. It requires careful planning, determination, and a clear vision. Currently, small businesses employ between 50-60% of South Africa’s workforce and contribute approximately 34% to GDP. A study by Global Entrepreneurship Monitor shows total early-stage entrepreneurship activity among 18-24 years old has increased from 3.4% (2002) to 19.3% (2021) and for the age 25-34, from 5.3% (2001) to 19% (2021). Is there a secret sauce? Adam Young, owner and director of Cape Town-based Rowdy Bags is one young entrepreneur who quickly identified a niche in the market. A small business created on the steps of UCT in 2012 that would become an award-winning, internationally acclaimed leather goods brand. “We are a young business made up of young people that are passionate about the slow fashion movement. Simple, beautiful designs that speak to a more sustainable future in fashion have been the vision that has taken us from one person with a dream to about 20 employees currently,” explains Young. “A huge turning point in our business was the pandemic, at the time about 95% of our business was direct to customers and when sales halted during lockdown; we made the decision to pivot our business to manufacturing cotton face masks.” Throughout this period, the founders of Rowdy Bags had always set their sights on taking the business internationally. Some of the relationships that they had been developing came into fruition in 2020 and that foresight enabled them to recover sales lost during the pandemic in new wholesale business abroad. With a decade of experience in the bag together with surviving a global pandemic, Rowdy has refined its products, while also empowering and honing the skills of the artisans who hand-make each piece. Strength is in your network Colin Timmis, country manager of Xero South Africa, a global small business platform, believes that a strong network and a well-crafted business plan, coupled with a positive attitude towards digital adoption and core business skills such as financial literacy, are significant factors in the success of young small business owners. “Young entrepreneurs and small business owners are often already digital natives and are leading the way when it comes to embedding technology at an early stage and innovating to do things differently,” he says. “It’s great to see so many businesses setting an example for those thinking of starting a business. Understanding the importance of digital tools and embedding them from the start will put young entrepreneurs in a strong position to create efficiencies and boost profitability.” Access to funding and support can also be a huge hurdle for young entrepreneurs. The good news is that financial advisors and accountants can help guide you so that you can benefit from the different funding opportunities available and the compliance that comes with applying for it. In fact, according to Xero’s 2023 State of Small Business Report, the two most significant factors that helped small businesses survive and grow in the past year were technology (41%) and their accountant (28%). The value of professional advice “Professional advice can unlock resources to access funding, mentorship, and training programmes aimed at the youth that can propel businesses forward. Our research found that 60% of small businesses believe accountants are key to economic growth. Almost half (49%) go to their accountants for business advice and guidance,” adds Timmis. “We know that small business owners and entrepreneurs have so many great ideas to grow and innovate, but funding to do this is often the hurdle. That’s why we’ve launched a Beautiful Business Fund to help support small businesses in key areas like tech innovation, sustainability, skills, and supporting their communities.” For many years, small businesses have served as the backbone of the South African economy, creating jobs that help families and communities put food on the table – and stimulating broader socioeconomic growth. They remain the most likely vehicle to tackle the country’s rising levels of youth unemployment, poverty, and inequality. ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.bizcommunity.com/Article/196/837/240626.html

Bonani Malgas | 31 July 2023 While there have been pockets of transformation in industry, there is still a long way to go, says Bonani Malgas, Procurement Manager at the Republic of Mozambique Pipeline Investments Company (ROMPCO). This is as South Africa celebrates and acknowledges the important role of women in industry, the economy, and in local communities and families on Women’s Day on 9 August. Commenting on the changes she would like to see materialise, Bonani explains that women bring different leadership skills to the table. Industry should celebrate the value of being different, break any biases and discrimination against women, address the gender gap, and increase the participation of women in top management positions and ensure they are retained. Bonani’s high-level role sees her attending to customer needs, sourcing the best suppliers, and building strong relationships. Her areas of responsibility include procurement lifecycle optimisation, category and Request for Proposal (RFP) management, supplier selection and management, and procurement data analysis. She is part of a two-person team dealing with all the company’s procurement requirements. “It has been exciting and challenging at the same time. The company is fairly new, therefore innovation, trying new things, and diversified duties are part of each working day. Working closely with the executives has afforded me the opportunity to learn many facets of the business,” says Bonani. Her career has progressed rapidly as a result, culminating in her role to bolster the procurement function across Mozambique and South Africa. Bonani has a National Diploma in Logistics Management from Nelson Mandela University, a BTech in Logistics Management, an Advanced Programme in Sourcing and Supply Chain, and a Master’s in Business Leadership, all from Unisa. ROMPCO recognises that its success relies on having a team of diverse people with extensive perspectives and experiences. The foundation blocks of its diversity and inclusion policy include creating a positive and inclusive working environment for employees and customers, protecting employees from discrimination, ensuring fairness and mutual respect, and creating a culture where diversity, equity, and inclusion in the workplace are respected and adopted as best practice. “The goal is to intentionally support transformation and empowerment in the gas distribution industry at a local and multinational level in both South Africa and Mozambique,” highlights Bonani. Her career highlights to date include successfully negotiating and implementing procurement principles for various major projects within the energy sector, drafting and implementing a supply chain policy, and establishing the procurement department. “Many perceive procurement as only a cost saver, but I see it as a strategic enabler that adds value to the company. It maximises value creation via supplier engagement and boosts competitiveness via supplier collaboration. This excites and drives me. It is also the change I want to see and push for,” comments Bonani. Her message to young women contemplating a similar career path is to understand the market you currently live in and to take chances. “Do not wait until you are 100% qualified for a job. Do your research, make that call, as uncomfortable as it may be, and apply for that position you have been eyeing. Talk to people in the profession and build networks. Lastly, overcome the pressure to be perfect at all times.” Bonani concludes that, as much as Women’s Day commemorates the 1956 march by women, it also means learning from those women who came before and continuing the good fight for everyone to be equal. ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.engineeringnews.co.za/article/rompco-supports-transformation-and-empowerment-in-the-gas-distribution-industry-2023-07-31

Marleny Arnoldi | 31 July 2023 Industry body Agri SA remains concerned about the draft Water Use Licence Applications, Amendment and Appeals Regulations published by the Department of Water and Sanitation (DWS) and believes these should not be enacted in the current form. Agri SA has noted its concerns in comments on the proposed regulations, saying that the regulations need to be reviewed and substantially amended, given the potential impact on food security. The draft regulations were published for public comment on May 19, proposing that certain enterprises applying for water-use licences to take or store water would in future have to allocate shares of up to 75% to black South Africans in order for the licence to be granted. Despite having received some clarification from the DWS in June, Agri SA says the draft regulations are misaligned with provisions in the National Water Act (NWA), the Equality Act and the Constitution. In its clarifications on the draft regulations, the DWS said the new transformation requirements proposed by the regulations would only apply to the 1.5% of water resources in South Africa that have not already been allocated. Additionally, the DWS said the regulations were not intended to apply to applications for the renewal of existing water-use licences, nor to the water-use licence applications which will arise out of compulsory licensing. Agri SA confirms that it has considered the clarifications received from the DWS in its parameters of the suggested reformulation of the regulations. The industry body explains that no provision in the NWA empowers the Minister to make regulations prescribing substantive requirements for licence applications or for the determination of licence applications. “Even if such power is inferred, the Act provides that, in issuing a licence, the responsible authority must take into account all relevant factors, including efficient and beneficial use of water in the public interest, the socioeconomic impact of the water use and investments already made by the water user.” Agri SA adds that the need to redress past racial and gender discrimination is one of the 11 factors that are taken into account when issuing water-use licences and that, by law, when determining an application for a water licence, the responsible authority must strike a reasonable balance between all the factors. The organisation states that the “arbitrary and therefore legally impermissible nature of racial quotas” have already been established by court judgments. “As the draft regulations do not allow for any element of discretion, they are so rigid as to be indistinguishable from a quota and therefore invalid.” Another concern Agri SA points out is that the draft regulations reduce transformation to black ownership, whereas the Codes of Practice issued under the Broad-based Black Economic Empowerment Act uses a scorecard that comprises five elements, with ownership being only one. Agri SA says the other four scorecard elements of management control, skills development, enterprise and supplier development and socioeconomic development should also be taken into account by DWS when issuing water-use licences. Moreover, the organisation says the inclusion of women as a previously disadvantaged group should also be taken into account, since the draft regulations only include racial transformation goals. Agri SA says it is well aware of the historical imbalances that prevail in the agriculture sector, but the sector must achieve equality within the rule of law. Agri SA’s submission makes it clear that, were the draft regulations passed as published, they would have a potentially catastrophic impact on agriculture and the country’s food security. The organisation ultimately advocates for a water licensing regulatory framework that respects the Constitution and protects food security. ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.engineeringnews.co.za/article/agri-sa-warns-of-unconstitutionality-of-proposed-water-use-licence-regulation-2023-07-31

Thank you for attending the session we hope to see you again soon. for upcoming events follow this link https://www.bee.co.za/training

Thabiso Mochiko | 30 July 2023 Most large farms in South Africa are well established, white-owned family businesses. The cost of funding transformation is prohibitive and there needs to be more co-ordination between stakeholders, say Agri SA, Nafu SA. The agricultural sector has posted mixed performance on black economic empowerment (BEE). Presenting the third Sanlam Transformation Gauge report, Lerato Ratsoma, MD at Empowerdex, said there were “a lot of improvements from last year. Ownership increased from 68% to 75%, but still below the 2021 figures. We are seeing an improvement in management and control, which must be commended.” Listed companies fared much better than their unlisted counterparts in areas such as ownership and skills development. However, in management and control, unlisted companies' performance was superior, while at listed companies it was below 50%, “which is an area of concern that should be delved into further to figure out why it's so low compared to everything else”, said Ratsoma. The Sanlam Transformation Gauge found a persistent challenge for the sector’s charter council was that few businesses reported on their broad-based black economic empowerment (B-BBEE) compliance. This year, only 57 businesses voluntarily submitted BEE certificates, according to Madime Mokoena, director at BBBEE Charters Compliance at the department of agriculture, land reform & rural development. The department managed to obtain an additional 21 certificates via desktop research and verification agencies, the report said. Mokoena said the data was inconclusive, making it a challenge to determine whether the sector was transformed. “There are more than 30,000 commercial farmers in South Africa, according to Stats SA, but only 57 submitted certificates.” Thapelo Machaba, agricultural economist and policy analyst at the Agricultural Business Chamber (Agbiz), said in the report that the nature of agriculture and the inherent flat structure of most primary agribusinesses deterred farmers’ participation in BEE. Motsepe Matlala, president of the National African Farmers Union of South Africa (Nafu SA) agreed, saying the country’s internal agricultural market was dominated by established, white-owned enterprises which are mainly “family businesses”. “You can’t come and tell me that I must come up with BEE in my family. It is not about the white farmers alone. Let’s be fair, it’s not easy to expect a family farmer to bring in a Motsepe Matlala to work in the family business,” he stated in the report. Nafu represents smallholders and commercial farmers with up to 20,000 hectares. Christo van der Rheede, CEO of Agri SA, said capital was needed to drive transformation. “[With the challenges farmers are facing, they are] not in a position to drive transformation on their farms because they just don’t have the capital.” Matlala agreed the cost of funding was prohibitive, saying during apartheid the Agricultural Credit Board funded white farmers and did not charge interest. “The government at that time truly wanted farmers to develop.” Van der Rheede and Matlala want transformation efforts to be consolidated. Van der Rheede said in the report there should be more co-ordination between stakeholders, with realistic goals to sustainably build and transform the sector. “The problem is we’ve got all these very good plans such as the National Development Plan and the Agriculture and Agro-processing Master Plan, but they are poorly executed, if at all.” Matlala said in the report that one national department and nine provincial departments acting independently made it difficult to deliver effective services to farmers. This had seen the proliferation of farmers’ unions and associations, leading to unnecessary contestation. “Farming is a business. Farming is a science. It should not be politicised or racialised,” he said. Ratsoma said there could be improvements and “I am hoping there will be as the economy improves and there are more available resources to fund different farming activities that fall under agri-BEE”. In forestry, while there had been some resistance to change, compliance had improved. According to the report, the sector achieved ownership targets of 92% from 72% last year, management was at 54% from 50%, skills development at 88% from 72%, and enterprise development was at 90% from 68%. Makhosazana Mavimbela, executive director of the Forest Sector Charter Council, stated in the report that big companies had been consistent with reporting and compliance. However, smaller businesses,, particularly those that did not do business with the government, needed to be persuaded to report. Forestry's management control stood at 54% behind the overall average of 67%. Mavimbela said companies were comfortable using the same faces on their boards because they were reliable. This often robbed them of an opportunity to give women a chance to contribute to diversity at board level. She acknowledged that while some companies were making progress, the sector continued to face migration and fewer numbers of women in science and technology. Commenting on skills, Mavimbela said work was under way to change the mindsets of young people who were not attracted by the rural locations of companies in forestry and also that the majority of roles were low-level — blue-collar work. “We are creating a database of women who are currently in training and also calculating how much the industry spends through bursary schemes and skills development, and how we can best maximise those resources,” said Ndlovu. ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.timeslive.co.za/sunday-times/business/business/2023-07-30-lack-of-capital-stymies-bee-in-agriculture--experts/

Sibongile Vilakazi | 31 July 2023 On the 20th of July 2023, the Black Management Forum (BMF) hosted a robust thinking session on reimagining Broad-Based Black Economic Empowerment (B-BBEE). We invited contributions from founding BMF President, Eric Mafuna; Economic analyst, Duma Gqubule; Business men, Dr Ruel Khoza, Mashudu Ramano and Sipho Nkosi to help unpack the issues surrounding B-BBEE in its current form and how we may want to proceed henceforth. As if telepathically, the speakers were aligned in their message that the time has come for black South Africans to explore who they are culturally and to explore their collective purpose in order to shape the kind of economic program that reflect their best interests. In his talk, Ramano articulated that the biggest success of colonialism and apartheid was its ability to convince Black Africans that they had no ability to produce anything for themselves and they had no culture of their own. That instead they were consumers of others’ cultures and ideas. This was of course not true because Africans have always had their own ways of living that were scientific. They produced everything from their own food, clothing, medicine and even permanent ink. They knew for instance that certain snake fat can heal burn wounds completely and they healed themselves by mixing plants and herbs and produced their own products by mixing elements of the earth or the “periodic table”. This was until they were convinced that they needed to stop and rather purchase everything produced by someone else. Khoza and Nkosi amplified this message by pointing out that we had believed what had been told about us as a people so much that we could not see the way out for ourselves. However, we had blamed colonialism and apartheid enough for our troubles. We needed to stop externalising the blame and take charge of our destiny. It was time we used the legislative environment appropriately. Introduce tighter legislation that is not open to interpretation and be clear that South Africa is not simply an ‘outpost of Europe’, existing for extraction to empower Europe or the West. The legislative framework must be conducive for the development and validation of Africans. We must partner in our own terms and not be price takers. Mafuna concluded the message by highlighting that we must stop undermining ourselves as a people because the world envies us. What makes South African talent attractive globally is our work ethic and creativity. We must know and believe that we are outliers as a country because we have achieved what many countries only dream of because we are able to rise from impossible conditions. Everyone in the room had come from a background that was meant to have broken them but had managed to get ourselves out of those backgrounds using whatever little resources were at our disposal. Therefore, we must be patient with ourselves because it takes generations to achieve what we are looking for. We must remove the notion that we are an incapable nation and continue to have conversations with ourselves. These are the frank conversations that are necessary and must happen at every corner to allow us to reflect about our own reflections and start moving in the direction of the desired economic emancipation. Gqubule used China as a case study to show what is possible when a people are clear about their own development. The fact that China had a 20-year vision and doubled the size of the economy every decade. The 20-year vision was broken down into 5-year plans with annual targets and adjusted tools of micro-economic policy accordingly to achieve the vision. Therefore, we must not reinvent the wheel but learn from those who had gotten it right. The thinking session was a first of many to come to drive these conversations with ourselves in order to reach consensus on the future we want to paint for the transformation agenda in the country. The current efforts at implementing B-BBEE and Employment Equity in particular have left a feeling of distrust amongst black professionals. The fact that 23 years of implementing Employment Equity Act has yielded 13.8% of Africans in top management versus 65.9% Whites in the Private sector and 20% Africans in senior management versus 55.1% Whites has shown that the transformation policies will not yield the desired results in the short-term and a different way of thinking must be introduced. The private sector is not willing to disrupt itself in favour of transformation and, therefore, black South Africans must start a process of disrupting themselves rather, to the benefit of their own economic emancipation. The time is now and we are ready! Dr Sibongile Vilakazi is the president of the Black Management Forum. ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.iol.co.za/business-report/companies/its-time-black-south-africans-had-a-conversation-with-themselves-to-drive-their-own-economic-emancipation-a40f3d0e-955f-4657-b2ea-b35ae1404878

Times Live | 31 July 2023 SA Inc’s efforts at transformation have improved, albeit slowly, according to the findings of this annual report Nearly 30 years since the dawn of democracy and more than 20 years after broad-based BEE (BBBEE) targets were introduced, the rate of transformation remains slow, according to the findings of the 2023 Sanlam Transformation Gauge report. The annual Sanlam Transformation Gauge, presented in partnership with the Sunday Times Business Times, is the only consolidated, sector-focused research report to take a holistic measurement of economic transformation in SA, accounting for all elements of BBBEE. In addition to providing a clear and accurate picture of the state of BBBEE and transformation in SA, the independent research carried out by Intellidex aims to ignite meaningful dialogue, shape policies and inspire actions that foster a more inclusive and prosperous future for all South Africans. “In SA, it is widely accepted that our challenges can be summarised in the triple challenges of poverty, inequality and unemployment, all of which can be resolved through the effective implementation BBBEE policy,” said Andile Khumalo, co-founder of the Sanlam Transformation Gauge report. The research is based on the BBBEE scores of 14,542 companies across 10 sectors of the BBBEE classifications system: Agri-BEE; Construction; Financial; Forestry; Information and communications technology (ICT); Integrated transport; Marketing, advertising and communication (MAC); Property; Tourism; and Generic, which includes all other sectors that do not have a gazetted BBBEE sector code, such as mining, manufacturing, wholesale and retail. The findings from this year's report were unpacked at the recent Sanlam Transformation Gauge Conference: watch the recording of this event below. Lerato Ratsoma, MD of Empowerdex, revealed that overall, SA Inc’s efforts at transformation have improved, albeit slowly. Overall, total scores improved to just above the level 3 threshold with a slight increase in black ownership from 75% of target in 2022 to 80.81%. Management control — traditionally a problem area — improved from 56% of target last year to just over 69% in 2023. Despite an expectation that enterprise supplier development (ESD) scores overall would see an uptick in 2023, this score has remained at a relatively low average of 75% of target. ESD is made up of procurement, enterprise development and supplier development. “Most companies get full points for enterprise and supplier development, but struggle with the procurement aspect because there are not always enough black suppliers to procure from,” said Ratsoma. The ESD pillar is regarded as one aspect of the BBBEE framework that could make a significant difference to SA’s economic trajectory if it was practised in the way that it was originally envisaged, to develop small and medium black-owned enterprises. Unfortunately, however, procurement practices have been subverted by corruption and the impact has been disappointing, according to the 2023 report. Newly appointed BBBEE commissioner Tshediso Matona, said when the BBBEE act came into effect, there may have been a naive belief that everyone would comply with the codes and act in good faith. It was not expected that people would want to “game the system” or that there would be “fronting and misrepresentation of BBBEE credentials”. Transformation not as advanced as BBEEE scorecards suggest This 2023 report included the findings of a Sanlam Transformation Gauge survey conducted among 42 BBBEE verification agencies. Though scores improved across the scorecard this year, except for socioeconomic development which remains well above target, the main theme emanating from the verification agency survey was that transformation is not as advanced as the scorecards suggest. More than half of verification agencies said management’s poor score was due to “resistance by corporate SA to seeing black people in leadership positions”. BBBEE participation is ostensibly still voluntary, even though it is legislated. However, in response to the slow pace of transformation, the government is pushing through a raft of legislation that attempts to enforce compliance in various ways. Matona believes there is a need to recalibrate the balance between incentives and penalties to improve compliance with BBBEE codes and targets given that businesses won’t be incentivised to ramp up their transformation efforts unless it has a measurable impact on their bottom line. There has long been an assumption that listed companies, which are required to submit their BBBEE compliance reports to the BBBEE commissioner, will have better results than unlisted companies. However, the 2023 Sanlam Transformation Gauge report found listed companies in the majority of sectors underperformed compared to their unlisted companies, in some sectors by a large margin. “While there is no apparent reason for this disparity, one possibility is that the balance sheets in the listed space are much larger than in the unlisted space, which in turn begs the question of how businesses are being funded,” said Sanlam chair Elias Masilela. Words need to be turned into action Previous Sanlam Transformation Gauge reports have highlighted BBBEE policy’s reliance on measuring inputs as opposed to outputs. In other words, it measures what a company spends on skills development, as one example, but does not measure the effectiveness of the skills training. In the absence of embedded monitoring and measurement mechanisms, it’s impossible to determine if the intended outcomes and impact are being achieved or not. This continues to be the case in 2023 with Matona conceding that these shortcomings are valid concerns. The unintended consequence of not measuring impact is that “these matters become relegated to a tick box exercise”, he said. This year's Sanlam Transformation Gauge Conference included a panel discussion on the “lived experience of BBBEE” vs the research findings. Panellists included Tabea Kabinde, chair of the Commission of Employment Equity, transformation consultant Litha Kutta, co-chair of the Enterprise & Supplier Development Community of Practice; Nozizwe Vundla, head of the Sanlam Foundation, Mamkeli Jim, a dealmaker in leveraged finance at RMB, and Disa Mpande, acting CEO at merSETA. They all agreed that the thinking regarding BBBEE needs to be reframed and more needs to be done to enable meaningful change. Other panel discussions at the event echoed a consistent theme: to enable real transformation, words need to be turned into action — with more opportunities for collaboration to be uncovered. “Collaboration is a key enabler in addressing some of the critical social ills that are facing our country,” says Ray-Ann Sedres, chief transformation officer at Sanlam. “We need to instil hope in our youth by working together to create more equitable opportunities to become economically active, thriving members of society.” ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.timeslive.co.za/news/south-africa/2023-07-31-native-sanlam-transformation-gauge-survey-reveals-a-mismatch-between-bbbee-scorecards-and-reality/

Dineo Faku | 30 July 2023 Transforming the “C-suite” in South African companies to reflect the country's demographics continues to lag, according to the latest Sanlam Transformation Gauge released last week. The report was produced by financial advisory firm Intellidex and sponsored by Sanlam in conjunction with Business Times and Andile Khumalo. The third edition of the report looked at B-BBEE scorecards of 14,542 companies in 10 sectors focusing on black ownership, management control, skills development, enterprise and supplier development, and socioeconomic development. The report said despite the improvement to 69% in 2023 from last year's 56%, management control had been the worst-performing segment since the report was established three years ago. More than half of the B-BBEE verification agencies that responded to the survey said racism was the reason corporate South Africa resisting appointing black people to management positions, while 23% flagged skills as a hurdle. In his message in the report, Bonang Mohale, president of Business Unity South Africa, said economic justice and fairness were required to boost economic growth. “Asking for a hand up is not the same as asking for a handout. B-BBEE is not a permanent crutch on which black people want to lean for the rest of their lives.” He said succession planning was key in transforming top management. “When you have black people and women in the C-suite, they will find other competent, professional and experienced black people. They will also enrich our collective culture, thought processes, strategies and priorities.” “C-suite” refers to senior executives whose titles often start with the letter “C”, such as chief executive officer, chief information officer and chief financial officer. Speaking at the launch of the report, Sanlam chair Elias Masilela said attitudes had not changed and corporate South Africa was paying lip service to transformation. “Why is BEE so elusive when we believe it is relevant to change our futures? It is not the policy, it is incumbents' attitudes, it is racism and corruption.” Masilela said South Africa needed to look at the underlying reasons why B-BEE had not worked. “Let us not deal with the symptoms, let us deal with the causes or the sources of the problems that bring us to where we are. Let us not blame the design, but the manner in which we implement and the conviction with which we implement. “Do not throw out the baby with the bath water. Replace the water and make sure it is cleaner and properly soaked.” Litha Kutta, co-chair of the Enterprise and Supplier Development Community of Practice, said South Africa needs to implement punitive measures by imposing fines of 10% of revenue on companies that fail to comply with codes. “For me it is the punitive side that is lacking. We can talk until we are blue, but until we fine people nothing is going to happen. We can have discussions and change the codes; absolutely nothing is going to happen.” The Employment Equity Amendment Act became law in April, giving the minister of employment and labour powers to impose targets in each sector for companies with 50 or more employees. Kutta said patronage undermined enterprise and supplier development. “Protecting the patronage system is fundamental to not dismantling the supply chain by bringing in people you do not know.” Tabea Kabinde, chair of the Commission of Employment Equity, said legislation for foreign nationals at top management should be scrutinised. “They are given work permits that are supposed to last for a certain period, but the reality is it keeps getting extended and my question is, why? “Why is it that as a country we are not getting to a place where we say skills development has got to work for us? ... We need you as much as you need us. Therefore, we are both going to make it work. I think we need to get to a point where we take the bull by the horns.” Disa Mpande, acting CEO of merSETA, said the report showed that skills training was a box-ticking exercise. “The critical skills needed to drive the economy — we are not training on them. We do skills development needs of each province and we were shocked that North West does not have engineers. How does it make sense when North West is the mining belt?” Mamkeli Jim, dealmaker for leveraged finance at RMB, said that despite challenges, B-BBEE had created monetary value for black entities 30 years into democracy. “There is probably northwards of R100bn that is sitting within black investment holding companies. You can look at that and say it is still small relative to the bigger pie, you can look at it and say it is a smaller grouping relative to the population of black people or you can say at least we are lucky there has been value and money sitting in black hands. There is a lot of value here that without BEE would not be happening; there are businesses that are started,” Jim said. ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.timeslive.co.za/sunday-times/business/business/2023-07-30-racism-behind-lack-of-diversity/