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Given Majola | 10 February 2023 The Amended AgriBEE Sector Code 2017, acknowledges the diversity and particularity of sub-sectors within the agricultural sector in South Africa, which is positive, but the wide scope also poses challenges, says Agbiz. File photo Cliffe Dekker Hofmeyr (CDH) yesterday said the Agriculture Sector Codes was still fairly new, but was a step in the right direction. CDH held a webinar yesterday, which focused on the B-BBEE regulatory environment applicable in South Africa in the agriculture and fishing sectors. With the advent of the Agriculture Sector Codes in December 2017, it made it easier to ensure and measure Broad-Based Black Economic Empowerment (B-BBEE) compliance. In CDH’s view it was likely to stay in place to allow the potential benefits and opportunities to crystallise over time. However, in the fishing industry, it said there was no B-BBEE sector code, and the generic code applied, but to a more limited extent. “There is accordingly, no sector specific B-BBEE regime applicable to the fishing industry which continues to apply its own policies and assessment processes which do take B-BBEE into account, but there are no fishing sector specific or relevant criteria in the generic B-BBEE Codes,” the firm said. It said the fishing sector might have to look at developing a B-BBEE sector code in the future, but at this stage it did not appear as if this was on the cards. But the changing nature of the Agriculture Sector Codes remained a challenge, Theo Boshoff, the CEO at Agricultural Business Chamber (Agbiz) said yesterday. Agbiz said promoting inclusive growth in the agro-food value chain was one of their core objectives. “B-BBEE remains directed at big businesses. In this regard, businesses in the value chains have made significant investments into B-BBEE. Investments that are made towards gaining greater recognition can be undermined when codes change. Long-term stability is required,” he said. Agbiz said the fundamental objective of the Act was to advance economic transformation and enhance the economic participation of black people in the South African economy. For this objective to be realised, the Code must be implemented, but there were geographic and financial challenges hampering its effective implementation. “Supplier development can be a powerful tool to aid black businesses throughout the value chain, but the rural nature of agriculture typically results in limited options as far as suppliers are concerned. For farmers, they need to source inputs from companies within the region to avoid exorbitant transport costs. There may therefore be areas where black suppliers are available but likewise, remote areas where the options are limited. “Agro-processors and food companies have invested substantially into developing black farmers and bringing them into their value chains. There are great examples within multiple value chains and some of the leading supplier development programmes empowering black farmers are being implemented by Agbiz members,” Agbiz said. But it said access to funding and the slow pace of land reform in South Africa continued to be a challenge to reaching industry goals and sourcing more produce from black farmers, however there were praiseworthy programmes that had made real progress. Boshoff said likewise, many agribusinesses and co-operatives who supplied inputs to farmers, had comprehensive farmer development programmes. These companies provided technical support, training, skills development and finance to black farmers. “Likewise, many commercial farmers provide mentorship and lend equipment to neighbouring black farmers. While this is very positive, the codes unfortunately provide little recognition for these companies as enterprise development (building black businesses who are not your suppliers) carries little weight in the codes. Here there is a clear mis-match between genuine efforts to build black businesses and the recognition provided by the codes,” he said. Boshoff said the Amended AgriBEE Sector Code 2017, acknowledged the diversity and particularity of sub-sectors within the agricultural sector in South Africa, which it said was positive, but the wide scope also posed challenges. This as the same code sought to cover input suppliers, agro-processors, traders and farmers. These companies operated in vastly different areas with very different issues. “A number of tweaks can certainly be made. For instance, voting rights as a measure of ownership may work for companies but not for co-operatives, which work on the basis of one-member, one vote. Using turn-over as a measurement of an entity’s size is also a challenge for agricultural commodity traders who move product through their books. They typically have a high turnover based on buying and selling stock, but with very low profit margins, thereby giving the impression that they are larger companies than they really are,” he said. Boshoff said elements such as preferential procurement was a challenge for farming as the options for procurement were very limited in deep rural areas. This was also the case with many farming enterprises that do not have multiple tiers of management. “An alternative, a simplified scorecard for primary agriculture should be considered. Overall, implementation and funding remains problematic. Verification is a costly process that adds to the cost of doing business. If the codes can be simplified and mechanisms be put in place to assist implementation (for instance, soft-finance for BBBEE deals), the uptake would likely be greater,” he said. ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.iol.co.za/business-report/economy/agriculture-sector-code-is-a-step-in-the-right-direction-says-law-firm-c0de17c8-ea74-4f09-8dac-17199edfddbc

News24Wire | 8 February 2023 SA's highest court has declined to hear an application for leave to appeal a lower court's ruling that found the state was wrong to include Broad-based Black Economic Empowerment (B-BBEE) as a criterion to access Covid-19 relief grants in the tourism sector. In April 2020, as the Covid-19 pandemic caused local and international tourism to grind to a halt, then-tourism minister Mmamoloko Kubayi set up a Tourism Relief Fund. Some R200 million was to be allocated for once-off payments of up to R50 000 for struggling small businesses. The minister included the B-BBEE status level of applicants as one of the criteria for funding. Trade union Solidarity and lobby group AfriForum then took the Department of Tourism to the North Gauteng High Court in Pretoria, arguing there was no need to use "race as a benchmark" for relief. While they lost their initial case, AfriForum and Solidarity won on appeal in the Supreme Court of Appeal (SCA) in September 2021. CODES The minister argued she was bound to include the B-BBEE level of applicants as one of the criteria for relief under the B-BBEE Tourism Sector Code. But the court found that the minister was mistaken, as relief grants administered under the Disaster Management Act could not be viewed as grants "in support of B-BBEE". The SCA said: Her inclusion of the B-BBEE status level of applicants for assistance as a criterion for eligibility for grants from the fund was therefore invalid. The court did not, however, rule that the R200 million already distributed to small businesses should be recovered, noting that neither Solidarity nor AfriForum has asked for this. APPEAL BID The department then applied for leave to appeal the SCA ruling before the Constitutional Court. On Wednesday, the apex court denied leave to the appeal. This means that the SCA's September 2021 ruling stands. In its ruling, the Constitutional Court noted that the issue was "moot" as SA's state of disaster had long been lifted and the funds already distributed. And while it would at times rule on "moot" issues, an increased workload means it must pick and choose its cases carefully. Solidarity deputy chief executive for legal matters, Anton van der Bijl, said that while some could view the case as "academic", it still set an important precedent. It would be harder for the state to include B-BEEE requirements as part of the criteria for relief funds in the future, he said. ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.engineeringnews.co.za/article/concourt-shoots-down-govt-appeal-over-bee-in-covid-19-tourism-funds-case-2023-02-08

Are you aware that, for the most, Broad-Based Black Economic Empowerment (B-BBEE) Practitioners are the weakest link in terms of fulfilling the country’s economic growth framework? Economists have established that increasing the diversity of shareholding, improving skills and expanding small business participation in supply chains are all components which could contribute to economic growth. However, only if it is done strategically by aligning with economic growth principles. The B-BBEE Act (The Act) has specific but broad, qualitative objectives which organisations and B-BBEE Rating Agencies generally choose to overlook in favour of the quantitative measurement benchmark of B-BBEE, namely The Codes of Good Practice (The Codes). However, subsequent amendments to The Actintroduced a risk as to the legitimacy of an organisation’s B-BBEE claims if they fails to recognise the link between The Act and The Codes. The consequence of failing to acknowledge the objectives of The Act could result in up to 10 years imprisonment and up to 10% of a Juristic Person’s annual revenue. Entrusted with defending the principles of The Act, The B-BBEE Commission is responsible for investigating activities that undermine or frustrate the objectives thereof. The mandate of the B-BBEE Commission is not only to evaluate the registrar of ownership transactions and report on the state of Transformation on an annual basis, but to also oversee, supervise and promote adherence to the B-BBEE Act. The mandate of the B-BBEE Commission is not to draft, implement or amend policies, but to provide interpretive guidance based on the objectives set out in the B-BBEE Act. Since being established in 2015, the B-BBEE Commission has increased its capacity and competence, thus increasing the risk to any individual or juristic person who engages in Fronting Practices. The people at risk of being prosecuted for Fronting Practices include, but are not limited to, directors, managers, administrators and B-BBEE Rating Agency employees. The Act leaves no place to hide for those flouting its mandate, as it defines a ‘knowing person’ as one that either had actual knowledge of a matter in question or was in a position in which they reasonably ought tohave known. It extends to a ‘knowing person’s’ obligation to investigate any matter in question to the extent that the outcome would have provided the ‘knowing person’ with the actual knowledge. The question is: if checks and balances were in place, would there be a different outcome? With such checks and balances in place would it be reasonable to assume that a ‘knowing person’ would, in effect, have had actual knowledge of the matter in question? For the most part, organisations have failed to develop internal competencies that create and drive B-BBEE Strategies. Consequently, there is a massive over-reliance on external B-BBEE consultants, B-BBEE Rating Agencies, accountants and lawyers. The Act indirectly defines the Board of Directors, the Executive Committee members and management teams as ‘knowing people’. Such ‘knowing people’, due to their limited technical understanding of B-BBEE, accept guidance from external advisers often without question. Subsequently, by the nature of what they do in their daily functions, they are ‘knowing people’ therefore, they are potentially personally liable and accountable if an organisation is found guilty of Fronting Practices. Considering the risk of exposure such ‘knowing people’ have while carrying out their daily duties, one would think that addressing such internal competencies would be a high priority for them. Solid internal competency is essential as it mitigates the risks to ‘knowing people‘. To achieve this, it is necessary to develop such people through high-quality broad theoretical training on all areas of B-BBEE legislation. It is imperative that ‘knowing people’ have the ability to create a control point so they can manage the B-BBEE process without being exposed to Fronting Practices. Core to mitigating such risk is introducing checks and balances on the processes in line with policy and procedure. This operational governance is imperative so that every ‘knowing person’ is secure in the claims they present for a B-BBEE Audit. Examples of typical Fronting Practices that ‘knowing people’ should be fully aware of include, but are not limited to: Ownership Fictitious Voting Rights claims whereby ‘Black’ People do not exercise these rights; Economic Interest claims with limitations on the utilisation of dividends; Net Value claims where ‘Black’ People do not benefit from the underlying value of their shareholding; Voting Rights claims of ‘Black’ People on the Board of Directors where such ‘Black’ People are not afforded these rights. Skills Development Expenditure claims for ‘Black’ persons living with disabilities whereby they do not meet the criteria of persons with a disability as defined in the Codes of Good Practice on Key Aspects of Disability in the Workplace issued under section 54 of the Employment Equity Act; Failing to confirm that the content of informal training is indeed training in line with the requirements of the Learning Programme matrix. Enterprise & Supplier Development Preferential Procurement expenditure with suppliers that do not qualify as an EME or QSE, otherwise suppliers that are at least 51% ‘Black’-owned, at least 30% ‘Black’- Women-owned or at least 51% ‘Black’ Designated Group Suppliers. Preferential Procurement expenditure where B-BBEE Credentials, presented by organisations without the resources to deliver, form part of the overall claim. Enterprise Development and Supplier Development claims where Beneficiaries do not qualify as per the criteria, or contributions did not meet the required objectives. Socio-Economic Development Claims where the status of the Beneficiaries is not confirmed; Contributions where the requirements did not meet the criteria. In conclusion, my advice to all ‘knowing people’ is always ascertain whether the B-BBEE advice you act on is indeed substantiated and aligns with both The Act and The Codes, whether or not it is for free or if you are paying for it. Be cognisant of the consequences of taking advice that cuts corners. Essentially, organisations should treat their B-BBEE Audit just as they would their financial audit by understanding the dynamics, using qualified suppliers and adhering to legislation in a meaningful and ethical manner.

Johan Botes | 8 February 2023 In a post-pandemic search for meaning, the modern workforce is increasingly demanding that their employers’ activities match their own personal ideals, and the mining sector is no different. Employees expect the company they work for to operate in a sustainable way and provide benefits for the environment, local economies and surrounding communities, all while maintaining a core focus on employee wellbeing, as well as their physical health and safety. With this renewed focus on corporate citizenship, mining companies have had to ensure they identify sustainability risks and opportunities in every part of their business strategy, including in workforce planning. Attracting the right talent particularly requires responsible leadership and increasing transparency. Employees of the modern workforce want to be in an environment where they feel they are making a meaningful contribution to the greater global issues. Employees, customers, shareholders and other stakeholders are also demanding that organizations take a stance on important issues such as racism, sexual harassment, unemployment, climate change and income inequality, for example. In the mining sector this extends to the communities in which the mines are located and incorporates ensuring that such communities are cared for and included. Mining companies are turning this challenge into a competitive advantage by creating workplaces with purposeful engagement and ways to accommodate a diverse set of employees with differing needs. Changing strategies While labour unrest in the mining industry, and those industries that support mining, is increasing, mining employers are also considering changes in their employee relations strategy that move from the primary focus being on collective engagement to recognizing the needs of smaller interest groups or, where possible, individual employees. Employee engagement surveys, individual feedback sessions, career planning, performance management, employee goal and expectation setting, anonymized feedback channels and exit interviews are useful tools in the arsenal of the modern people practitioner and line manager. These and other communication vehicles are likely to be a more accurate barometer of the employee relations climate than considering the number of days lost due to industrial action, number of grievances filed, or labour disputes declared. In this era of high employee mobility – even when taking into account the dramatic unemployment rate – staff appear to become more inclined to vote with their feet than filing a grievance or demanding that their trade union resolve the issue with the employer. A successful business will also create opportunities for feedback and information from staff and stakeholders outside (or in addition to) the traditional upward communication channels. They will also find workplace-appropriate mechanisms to regularly test the employee relations climate, being nimble to adjust employee relations strategies to tailor to the fast-changing views of society as reflected in the workplace. A further imperative for employers of the modern workforce will be creating purpose for employees by communicating an understanding of what the business is and the reason for its existence, then linking that to the function of the teams and individuals. Dealing with violence and harassment at work It is undisputed that there is an increasingly high rate of global violence against women, and with more studies pointing to the growing rate of the violent harassment of men, especially those in vulnerable social positions such as migrants. As such, employers are assessing their current policies and considering whether they are fulfilling their common law and statutory obligations when dealing with violence and harassment in the workplace. Further, some employers are now going further and considering establishing workplace rules that make it a workplace offense to commit acts of violence against women or men, stating employees who are convicted of violent crimes may be dismissed, even if the crime took place away from the workplace and against a private person. I&D programmes Mining companies know that inclusive and diverse (I&D) corporate cultures lead to increased productivity and meaningful employee engagement, which ultimately offer immense value to businesses. I&D fosters innovative participation, which gives rise to a confluence of creative ideas arising from the richness of different backgrounds and experiences, all of which work together in the formulation of solutions to business challenges and idea-generation. Simply put, diverse spaces ultimately lead to better outcomes than homogenous spaces. As such, conscious and forward-looking businesses consider I&D to be a measure of their success and indispensable to their overall sustainability. I&D is firmly on the agenda of most organizations and businesses around the world. Scrutiny of income inequality Recent reports show that South Africa is one of the worlds’ most unequal countries when it comes to income. Research by Aroop Chatterjee, Léo Czajka and Amory Gethin found that, before taxes, the share of average income going to the top 1% of earners in South Africa increased by 50% in the period 1993 to 2019, while the income of the poorest 50% decreased by more than 30%, after inflation. In South Africa, Section 27 of the Employment Equity Act (EEA) requires designated employers (employers who employ more than 50 employees or meet a certain annual turnover threshold specific to their threshold) to report income differentials across both race and gender groups, but this is a confidential document submitted to the Department of Labour and it does not have to be made transparent. In addition to complying with these legal requirements, mining companies are addressing income inequality within their businesses through analysing data on pay differentials and conducting audits of their employment policies and practices. Income equality considerations should permeate all business processes that relate to and influence the employee experience – from recruitment to inclusive onboarding initiatives, teambuilding culture, performance reviews, succession planning, mentoring and sponsorship, for example. The focus should be on empowering employees to have, not only equal pay for work of equal value, but also, for example, equitable access to work opportunities, skills development and training, the right to capital assets, as well as access to programmes that focus on, for example, women’s health and well-being in the workplace. Employers should set targets and measurable goals to address income equality and ensure that such targets are published in the public domain. Transparency has been noted as key in addressing and being held accountable for reducing global income inequality. Beyond the need to do the right thing, as well as to comply with country-specific employment regulations, there are other reasons for addressing income equality – most notably the high correlation between income equality and diversity, workforce productivity and business profits. Essentially, employees want to know they are working in a role that provides not only personal meaning, but that the business is fulfilling its responsibilities to society and the environment. In return for providing this, businesses are able to attract and keep their most precious commodity – thriving, happy employees who gain meaningful, layered rewards from their work. By Johan Botes, Partner and Head of the Employment & Compensation Practice, Baker McKenzie ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://africanminingmarket.com/the-rise-of-employee-value-in-the-mining-workplace/15045/

Jabu Tshabalala | 7th Feb 2023 We need 11 million more jobs, and small businesses will create 90% of them. We cannot have 70% youth unemployment and expect peace. During his state of the nation address (Sona) on Thursday, South African business organisations hope President Cyril Ramaphosa will recognise the country’s crises and also acknowledge a black economic empowerment (BEE) milestone. Business Unity South Africa (Busa) chief executive Cas Coovadia told Sunday World during an interview that Ramaphosa needed to recognise the country was in crisis. “We have a multifaceted crisis. The starting point when dealing with it is decisive and courageous leadership from the president,” Coovadia said. Black Business Council (BBC) chief executive Kganki Matabane said 2023 was significant as the Broad-based Black Economic Empowerment Act turns 20 years this year. “We’re expecting the president to reflect on that, and the progress made so far,” he added. The BBC wants Ramaphosa to indicate what the government’s plans to accelerate BEE are going to look like. This is particularly in light of the BBC’s data showing that black people own less than 5% of the economy and government employment equity reports indicating about 70% of JSE-listed company CEOs were white males, Matabane said. Coovadia said Ramaphosa needed to address several critical issues in his 2023 Sona. “The top issue is energy. The president’s energy plan is on the table, and he needs to assure the country that the government will urgently implement it. “But unfortunately, that plan will only bear fruit in two years,” he added. Matabane also believes the country’s first issue is solving the power crisis. “It needs to be sorted out as soon as possible. If we continue like this for the next three years – the economy may collapse,” he added. The National Development Plan aims to cut unemployment to 6% by 2030 from more than 30% today. “We need 11-million more jobs, and small businesses will create 90% of them. We cannot have 70% youth unemployment and expect peace. We want the president to say something about that,” Matabane said. The BBC also wants the president to deal with crime and corruption during the Sona and for him to put the National Prosecuting Authority under pressure to act. He added it was important that the government announced measures to deal with crime and protect South African citizens. “If they have to hire more police, let them do that,” he added. This is particularly important as Matabane said many high-net-worth individuals were leaving South Africa because of crime and loadshedding. This emigration is reducing the country’s tax base. Coovadia said Busa expected the president to address the country’s logistical problems. “Transnet’s performance is far from optimal, and our road network is collapsing after being one of the best on the continent.” “I don’t know if the president will have announced his cabinet by then, but his cabinet needs to speak with one voice under his leadership and not have mixed messages from different ministers,” he added. ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://sundayworld.co.za/news/business/business-cries-out-for-light-at-end-of-sona-tunnel/

Department of Women, Youth and Persons with Disabilities | 8 February 2023 Gender-Responsive Budgeting Workshop seeks to restructure the way Government looks at financing the gender agenda The Department of Women, Youth and Persons with Disabilities held a 2-day workshop on Gender Responsive Planning, Budgeting, Monitoring, Evaluation and Auditing (GRPBMEA) from 6-7 February 2023 in Benoni, Gauteng Province. The workshop was attended by officials representing the three tiers of government, as well as civil society organisations and academia. The national workshop, attended by over 500 officials working in planning, monitoring and evaluation, and finance, focussed on the implementation and institutionalisation of the Gender Responsive Planning, Budgeting, Monitoring, Evaluation and Auditing Framework (GRPBMEAF), approved by Cabinet in 2019. It is important to note that, as the department, our implementation of the framework covers priorities for women, youth and persons with disabilities (WYPD). The workshop aimed to reflect, engage, and share progress made and lessons learned towards knowledge improvement and commitment to the institutionalisation and mainstreaming of women, youth and persons with disabilities. The workshop was themed: “Leaping towards the achievement of the MTSF 2019-2024 target to institutionalise 100% women, youth and persons with disabilities Responsive Planning, Budgeting, Monitoring, Evaluation and Auditing.” The DWYPD has a critical mandate to regulate the promotion of women empowerment and gender equality, youth development and the promotion of the rights of persons with disabilities. The GRPBMEAF is therefore one of a number of tools used by DWYPD to regulate the institutionalisation of mainstreaming of WYPD priorities across the work of government. With this workshop the department sought to encourage and ensure that the broader public service prioritises women, youth, and people with disabilities priorities into all plans and budgets in order to improve the results for women's empowerment, youth development and realisation of the rights of the persons with disabilities in the country. The workshop sought to: Broaden the status on progress made on the implementation of GRPBMEAF by national departments and provincial departments and related stakeholders is provided; Share best practices and relevant knowledge regarding policies, programmes and institutional mechanisms which have successfully advanced WYPD empowerment and equality related matters; Strengthen monitoring, evaluation and reporting on the implementation of the GRPBMEAF in support of the prioritisation of the institutionalisation and mainstreaming of WYPD; Promote accountability for full implementation of GRPBMEAF as well as strengthened knowledge on WYPD evidence; and To discuss the recommendations and interventions for continuous improvement on the process of the implementation of GRPBMEAF and WYPD priorities. A gender responsive budget is an important mechanism for ensuring greater consistency between economic goals and social commitments. Periodically, DWYPD hosts meetings with national and provincial departments to capacitate departments and track progress on the implementation of the framework. The results are an improved awareness and understanding of the framework as well as an improved response rate on the self-assessment reports by departments to over 50%, which provides a baseline on institutionalising the framework. What is the Gender-Responsive Planning, Budgeting, Monitoring, Evaluation and Auditing Framework? The Bill of Rights guarantees full and equal enjoyment of all rights by all genders and the protection of people against any form of discrimination. In addition, South Africa is a signatory to a number of international and regional commitments to gender equality and women empowerment, including the Convention on the Elimination of all Forms of Discrimination Against Women (1995) and the Southern African Development Community Protocol on Gender and Development (2012), amongst others. The South African Parliament has passed legislations that further the goals of gender equality, including the Employment Equity Act, 1998, and the Promotion of Equality and Prevention of Unfair Discrimination Act, 2000. South Africa initiated a number of gender responsive budget initiatives since the dawn of democracy in 1994 and was seen as leading both on the continent and globally in developing and implementing Gender Responsive Budgeting methodologies. However, as a country we have since regressed. There is much to learn from these initiatives and the evolving legislative and policy context in South Africa, and how to sustain our gains. The Department of Women, Youth and Persons with Disabilities (DWYPD) developed the Gender Responsive Planning, Budgeting, Monitoring, Evaluation and Auditing (GRPBMEA) Framework that was approved by Cabinet in 2019. The Framework sets out an approach to ensure that the country and government-wide systems explicitly and consistently respond to women’s empowerment and gender equality priorities. The institutionalisation of GRPBMEA is directly linked to gender mainstreaming across the state. Gender-responsive budgeting initiatives seek to create a direct linkage between social and economic policies through the application of a gender analysis to the formulation and implementation of government budgets. A gender analysis can also demonstrate the ways in which social institutions that are seemingly “gender neutral” do in fact bear and transmit gender biases. Gender budget analyses can be applied to gender specific expenditures, expenditures that promote gender equity within the public service and general or mainstream expenditures. The achievement of Gender Equality and Women Empowerment (GEWE) requires a greater equal sharing of the allocated financial resources towards programmes and interventions which should equally benefit women and men. This will ensure the achievement of women’s economic, social and political empowerment. In order to achieve this, engagements with relevant stakeholders is crucial to facilitate commitment towards ensuring the inclusion of gender in the budgeting process. As DWYPD coordinate the implementation of the GRPBMEAF, centre of government departments have been central to driving the government wide institutionalisation of the framework, in particular Department of Planning, Monitoring and Evaluation (DPME) and National Treasury (NT). Find the Gender-Responsive Planning, Budgeting, Monitoring, Evaluation and Auditing Framework here: https://tinyurl.com/yc6fj6wz(link is external) For media related queries: Mr Shalen Gajadhar Director: Communications, Department of Women, Youth and Persons with Disabilities Cell: 060 979 4235 For media engagements: Ms Xolelwa Siya Dwesini Xolelwa.Dwesini@dwypd.gov.za Cell: 081 030 9109 ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.gov.za/speeches/gender-responsive-budgeting-workshop-seeks-restructure-way-government-looks-financing

Pieter Groenewald | 8 February 2023 South Africa has had enough of empty promises and President Cyril Ramaphosa cannot simply repeat the same plans and promises he made in previous State of the Nation Addresses (SONA). These empty promises by ANC heads of state have formed a pattern where the same plans are rehashed, or tweaked a little, every year to try and fool the public. An example is the 2022 promise that more will be done to create a favourable environment for the private sector in order to stimulate economic growth. Nothing came of it. On the contrary, along with administrative red tape the suffocating screws of Black Economic Empowerment (BEE) and Affirmative Action (AA) have only been turned tighter. That is evident in the Employment Equity Amendment Bill, which was passed last year. It affords the Minister of Trade and Industry extensive powers to decide for himself where transformation in the workplace is falling short, and what the new transformation targets ought to be. All that is left is for the President to sign it. It is the complete opposite of what he promised a year ago. Legislation like this has caused South Africa's private sector and the country's economy unmeasurable damage. The President's promises and reality are obviously two vastly different things. Likewise, very few of the other SONA promises realised. The President must say why they were not implemented, and he must announce decisive plans for stimulating the economy. The President must be very honest about the ongoing power crisis and he must put forward government's plans to address it in great detail. Harsh experience has, however, taught that it is best to temper any optimism about the practicality of SONA promises. Thursday's SONA will, like before, probably be no more than a rehash of the grand ideas and impractical plans of the past. Under ANC rule, the country's administration has deteriorated to such an extent that even viable plans are difficult to implement. It has plunged the country into this current crisis. The FF Plus does not foresee any deviation from the recipe that the ANC has been following to run South Africa into the ground over the past three decades. ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.politicsweb.co.za/politics/sona-empty-promises-will-fool-noone--pieter-groene

Many organisations choose third party facilitators to distribute their SED contributions, which the Codes allow. However, organisations must note that, according to the Codes, the ultimate benefit needs to flow to the intended Black Beneficiaries. The B-BBEE Commission’s SED Brochure , published in September 2019, addresses third-party facilitation of such contributions. Third party facilitators for SED contributions are usually Non-Profit Organisations (NPOs) or Public Benefit Organisations (PBOs), including Non-Profit Companies (NPCs). Such facilitators must produce either a B-BBEE Certificate or Affidavit to confirm their B-BBEE status. NPOs, PBOs and NPCs are Specialised Enterprises for purposes of B-BBEE measurement. Their B-BBEE compliance is measured in terms of Statement 004 – otherwise known as a Specialised Scorecard. Socio Economic Development Services are available to guide organisations in facilitating SED contributions in line with the requirements.

On 07 February 2023, the B-BBEE Commission has published Practice Guide 01 of 2023 which intends to assist Organs of State and Public Entities to better prepare for verification processes. The Practice Guide outlines the documentary evidence per an element that an Organs of Stat or Public Entity would need to have in place when undergoing a B-BBEE Verification process.

In order to receive Skills Development points, under the Skills Development Scorecard, a Measured Entity must meet specific criteria: Have a Workplace Skills Plan, an Annual Training Report, and a Pivotal Report, which are SETA approved. Implement a general Priority Skills programme, and a more specifically for Black people. The 3.5% compliance target under paragraph 2.1.1.1 (Skills Development Expenditure on Learning Programmes specified in the Learning Programmes Matrix for Black people as a percentage of the Leviable Amount), includes external training expenditure for unemployed Black people as per the Skills Development Scorecard. When implementing initiatives under paragraph 2.1.1.1 (Skills Development Expenditure on Learning Programmes specified in the Learning Programmes Matrix for Black people as a percentage of the Leviable Amount), these Training Initiatives cannot be counted under paragraph 2.1.1.2 (Skills Development Expenditure on Bursaries for Black students at Higher Education Institutions), and vice versa. In order for a Measured Entity to score Bonus Points under paragraph 2.1.3 (Number of Black people absorbed by the Measured Entity at the end of the Internship, Learnership and Apprenticeship programme, under paragraph 2.1.2.1 [Number of Black people participating in Learnerships, Apprenticeships and Internships as a percentage of total employees,]), a trainee tracking tool has to be developed. Should less than 100% of the trainees be absorbed, as per paragraph 2.1.3, the percentage achieved or absorbed, will be recognised. The Sub-Minimum and Discounting Principle Under the Skills Development Scorecard, a Measured Entity must achieve 40% of the total Weighting Points (40% of 20 points), which exclude the Bonus Points, as set out under Statement 300, the General Principles for Measuring Skills Development. Should a Measured Entity not comply with the threshold targets that have been set, the overall achieved B-BBEE Status Level will be discounted by one (1) Level, as has been specified in paragraph 3.4 of Statement 000. Skills Development Expenditure Legitimate Recognisable Training Expenses The following expenses are recognised as legitimate training expenses, under the Skills Development Element: Training material costs Trainers’ costs Training facilities and catering costs Scholarships and bursaries Course fees Accommodation and travel Administrative costs such as the organisation of the training, which includes, where appropriate, the cost of employing a Skills Development facilitator or training manager, to the Measured Entity. Learning Programme Matrix

Darren Parker | 8 February 2023 President Cyril Ramaphosa must focus on small and medium-sized enterprises (SMEs) when he addresses the country regarding the steps government is taking to alleviate the nation's energy crisis, industrial and logistics parks owner and operator Inospace COO Jacques Weber says. More than 1 500 SMEs, which have been hard-hit by the impacts of loadshedding, run their businesses from Inospace's logistics parks. "We call on the government to immediately provide unconditional assistance to SMEs whose businesses are at an enormous risk of being annihilated by unending loadshedding," Weber says. He referred to the Department of Small Business Development, recalling that it was considering relief measures to assist SMEs affected by loadshedding. “These measures must be realistic and translate into financial assistance,” he states. SMEs play a significant part in South Africa's economy, making up more than 98% of businesses nationwide and contributing 39% towards the country's gross domestic product. According to Weber, that contribution is likely to increase in the next few years. However, these businesses are most vulnerable to economic upheavals and externally driven pressures. “While loadshedding persists, thousands of SMEs are . . . contemplating shedding jobs, lowering production or possibly winding up. The SME segment of the economy does not have the means to get off the grid through costly alternative power solutions,” Weber notes. He explains that, in 2019, the Department of Trade and Industry launched the Intsimbi Future Production Technologies Initiative (IFPTI) to position South Africa's advanced manufacturing sector for the Fourth Industrial Revolution. "While many participants in the industrial sector were impressed with the government's strategy, the lack of reliable electricity supply will take the industrial sector from the Fourth Industrial Revolution to before the first one. Reliable power is the foundation of economic development," Weber says. Inospace believes that funds and facilities must be urgently provided to relieve smaller businesses with their existing debts and payments. The company, which specialises in providing industrial and last-mile logistics spaces with business services, believes that government relief should assist SMEs in paying for raw materials, labour and other operational costs. "These interventions must be structured to match the patterns of small business cash flow and the extent of the impact experienced due to the loadshedding,” Weber says. Inospace, which has more than 50 serviced logistics parks in Cape Town and Johannesburg, has launched a "Living with Loadshedding" project to help its clients minimise disruptions to their business operations. The project includes solar solutions, inverter options and generator advice to assist SMEs who require emergency assistance. It has also established a hotline, which Inospace clients can use for advice or emergency relief. Inospace installs solar plants to reduce consumption on the various grids and lower demand. The company also allows clients to install their own dedicated solar panels, which benefit the tenants' electricity bills. "Many property companies use solar as a yield-enhancing profit generator, but we will use solar to keep our clients in business. We allow our clients to move between logistics parks and use our business hubs with 24/7 power. They can now work between the different loadshedding stages," Weber says. "Everyone hopes that loadshedding will start bottoming out and slowly easing over time, but it's unlikely there will be any relief soon. Accommodating loadshedding into our business operations and strategies will be essential for at least a few years.” ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.engineeringnews.co.za/article/ramaphosa-urged-to-consider-smes-in-fight-against-loadshedding-2023-02-02

Darren Parker | 6 February 2023 A complete overhaul and rebranding of broad-based black economic empowerment (BBBEE) is needed to undo and overwrite the damage done to the system by unscrupulous opportunists who have used corruption and State capture to enrich themselves through the abuse of empowerment policies, Centre for Economic Development and Transformation director Duma Gqubule has said. “We need to rebrand this thing. It might even involve a name change, because in the public, it has been discredited,” he said on February 6. Speaking at a seminar on BBBEE in Johannesburg, hosted by investment firm Kagiso Capital, Gqubule said the measurement of black ownership currently had zero credibility, stating that there was no relationship between actual black ownership and what was on the black economic empowerment (BEE) certificates of many companies. He said there were so many ways of representing the statistics, with so many creative ways to manipulate those statistics, that the result had been a “confusing maze of black ownership statistics”. For example, financial institution Nedbank quoted its black ownership at 37.6% in March 2017. However, in its year-end financial report for the same year, the actual figure included was only 1.7%. Moreover, reported BEE statistics differ dramatically between the JSE at 23% and the National Empowerment Fund at only 3%. He attributed the “voodoo BEE accounting system” to a series of policy concessions made when the BBBEE Act was first promulgated. Among these concessions he referred to was the flow-through principle, which allowed a 51% black-owned company to be counted once as 100% black-owned in an ownership chain. Other concessions he mentioned included the exclusion of mandated investments and State ownership, the continuing consequences principle, third-party ownership and the exclusion of non-South African assets. In an experiment, Gqubule said the application of these concessions using the “voodoo BEE accounting system” turned an actual 6% black ownership of a consortium into 26% black ownership on paper. He also decried the “once empowered, always empowered” principle applied to large companies, such as banks and mining companies, who have no incentive to enter into replacement BBBEE transactions. However, despite these issues undermining the success of BBBEE, Gqubule blamed the African National Congress- (ANC-) led government’s mismanagement of the South African economy for 27 years as the real reason that BBBEE is failing. He said there needed to be drastic changes made to the government’s failed macroeconomic policies. “The ANC government - you've been talking about structural reforms for a decade, but you cannot deliver growth, and you will not deliver growth. The only way is for the government to spend more on its people and its infrastructure to grow this economy,” he said. Gqubule added that there would need to be a significant revamping of the BEE policy framework to stimulate a third wave of transactions. Further, he called for a new BEE Commission to be instated. ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.engineeringnews.co.za/article/negative-connotations-mean-bbbee-needs-to-be-completely-overhauledadvisor-suggests-2023-02-06/rep_id:4136