New BEE codes offer concessions to SMMEs and multi-nationals

Codes of Good Practice approved by Cabinet
Joy orlek
THE SA Association of Freight Forwarders has given the thumbs up to last week’s approval by Cabinet of the Codes of Good Practice on Broad-Based Black Economic Empowerment (B-BBEE ). “We’re pleased that there is finally stability, that a line has been drawn in the sand against which we can measure ourselves,” Tony d’Almeida, Saaff board member responsible for education and training and group IR director of UTi told FTW. “At last we have something predictable, measurable and stable.” The codes will be published in the government gazette early next year. Exemption for smaller companies and start-ups and flexibility for multi-nationals in the structuring of their empowerment deals are two of the key concessions in the latest set of codes. SMEs with an annual turnover of R5 million or less will not be checked against B-BBEE scorecards, and neither will start-up companies which have been in business for less than a year. Global, multi-national companies have been given more flexibility in how they make B-BBEE arrangements. “These do not have to be representation at ownership level,” said deputy director general of the Department of Trade and Industry (Dti), Lionel October. Quoted in BuaNews, he explained that a global company doing business in South Africa, such as vehicle manufacturer Daimler Chrysler, did not have to limit its B-BBEE efforts by selling shares of its local operations to local consortia. Such a business could, for example, introduce empowerment through its procurement processes or its retail functions by ensuring its dealerships were representative of B-BBEE. “This concludes phase two of the BEE consultative process,” said October. In addition to a sector-wide generic scorecard, Cabinet has approved the codes of good practice in specific sectors, as well as the scorecard on multi-nationals. Companies in the agriculture, tourism, finance and construction sectors now have charters with different measures from those in the generic scorecard for the representation of black interests. These interests are measured across all sectors in the generic scorecard in terms of skills development, ownership, employer equity and management amongst others.