In the News (145)
THE government, the financial services industry, industry charters in general and verification agencies are all contributing to the continuation of fronting, delegates at the Broad-based Black Economic Empowerment Commission conference on fronting say.
Fronting refers to misrepresenting a business as black-owned and run in order to secure contracts, although the real decision-making is done by white people, who also reap the financial benefits. Fronting is a criminal offence under the recently amended Broad-based Black Economic Empowerment (B-BBEE) Act.
Deputy Minister of Trade and Industry Mzwandile Masina says one of the factors contributing to the slow pace of economic transformation in South Africa is “fronting”, where businesses pretend to be BEE compliant but don’t actually benefit black people.
Volkswagen Group South Africa (VWSA) has invited black-owned suppliers to participate in its first ever black-owned suppliers’ day.
The event will take place at the VWSA PeoplePavilion in Uitenhage, in the Eastern Cape, on Thursday, May 5.
Successful applicants will have the opportunity to display their products and services to VWSA, the company’s suppliers and other automotive manufacturers, with a possibility of securing contracts.
The Department of Trade and Industry (DTI) and the BBBEE Commissioner held a conference on Tuesday 29 March 2016 to help black-owned businesses implement the Broad-Based Black Economic Empowerment (BBBEE) Act correctly and to counter BBBEE fronting practices.
Held in Midrand with “Do it right and lead from the Front on Empowerment” as its theme, the conference also provided the overview of the BBBEE Act and the recently launched Black Industrialists Programme as interventions by government to drive economic transformation.
- BBBEE Commissioner
- The Department of Trade and Industry
- Broad-Based Black Economic Empowerment
- BEE Code
- BEE Act
- South Africa
- Minister of Trade and Industry
- Rob Davies
- Commission on Employment Equity
- National Empowerment Fund
- Johannesburg Stock Exchange
South Africa Deputy President: White Monopolies Must End, Government Will Contribute Billions to Black Empowerment and BusinessesWritten by Renee Ash
Deputy President Cyril Ramaphosa has promised Black business that the government will spend billions on Broad-Based Black Economic Empowerment in the coming years.
“We are going to intensify BBBEE. We are going to sharpen our teeth and determination when it comes to unemployment. We expect that our Black industrialists will have up to R24 billion made available to them to redefine the way business is done in our country,” he said at an ANC summit for academics and professionals in Johannesburg on Wednesday night.
Ramaphosa encouraged Black business to bring their ideas to the ANC. He then asked them to open their wallets to support the party’s local government elections campaign.
Ramaphosa said the time of white business monopolies was over. Government was hell-bent on making sure Blacks owned and managed the economy.
Hot on the heels of International Women's Day, The Deputy Minister of Tourism, Tokozile Xasa, proudly launched the Executive Development Programme at the UNISA Graduate School of Business Leadership today.
As outlined in the National Development Plan (NDP), socio-economic transformation policies and programmes is aimed at steering the economy on an inclusive growth path. Tourism is one of the key economic pillars and contributes significantly to the GDP and job creation.
German-based enterprise software firm SAP unveiled a new empowerment deal which aims to achieve a 30% Black Ownership target in the BBBEE codes applicable to all South African IT companies.
SAP unveils second South African empowerment deal
By Gugu Lourie
In a move signaling its commitment to South Africa, SAP SA, a unit of German-based enterprise software firm SAP, is strengthening its Broad-Based-Black-Economic-Empowerment (BBBEE) credentials by concluding another empowerment transaction.
SAP South Africa will issue 19.5% shares to The SAP South Africa Empowerment Trust, the beneficiaries of which are previously disadvantaged black students. These beneficiaries will use the dividends received from SAP South Africa to pay for studies facilitated by the Maharishi Institute.
- Broad Based Black Economic Empowerment
- Black Economic Empowerment
- SAP SA
- Software Enterprise Company
- IT Company
- Pfungwa Serima
- SAP Africa
- Maharishi Institute
- Dr Taddy Blecher
- SAP South Africa Empowerment Trust
- South Africa
- South African economy
- BBBEE Scorecard
- Codes of Good Practice
- BBBEE Codes
- Black Ownership
- Maharishi Institute,
Exaggerated figures are a factor of the current BBBEE rules... and mixed with a number of other accounting adjustments that turn white money black, renders the black ownership values we see in BBBEE certificates misleading, Philisiwe Mthethwa wrote in a recent Business Opinion piece on IOL.
Black ownership must be distilled to reach 25%
by Philisiwe Mthethwa
The launch of the Black Industrialist Policy promises to accelerate South Africa’s economic transformation but the empowerment project might still be significantly held back if the equity leakage that comes with the rules of calculating black ownership, in particular accounting for mandated investments, is not reviewed.
- Broad-based Black Economic Empowerment
- Black Economic Empowerment. BEE
- Codes of Good Practice
- BBBEE Codes of Good Practice
- Black Industrialist Policy
- South Africa
- Black Ownership
- BBBEE scorecards
- BBBEE scorecard
- National Empowerment Fund
- Direct Black Ownership
- Philisiwe Mthethwa
New Generation Mindset (NGM), a Johannesburg-headquartered enterprise development and social economic development consultancy, has put out a call for black-owned tech startups to join its incubation programme in the Western Cape.
NGM says on their website that they aim to create an enabling environment for sustainable businesses and boost the government's efforts to create a more inclusive economic participation, especially for the previously disadvantaged individuals and communities, through Enterprise and Supplier development.
"Our strategic focus is on two areas of intervention: Enterprise Development and Social Economic Development, scoring the client weighted points in two codes of the B-BBEE scorecard for their single investment."
Hammanskraal - The Democratic Alliance would hasten the land reform process in South Africa if it were to come to power, party leader Mmusi Maimane said on Monday.
“Democrats, people are going to talk, saying the DA doesn’t want the land reform. What now? We have already advanced the land reform in the Western Cape faster than any other province. But we can’t just talk about rural land reform, we must also talk about urban land reform,” Maimane told supporters after a walkabout in Ramotse village in Hammanskraal, north of Pretoria.
VODACOM will be hard-hit by the draft amended broad-based black economic empowerment (BBBEE) code for the information and communications technology sector (ICT), in which a critical clause has been removed from the previous versions. That clause deemed any empowerment transaction worth R7.5bn or more as being equivalent to the required black ownership target of 30%.
Vodacom’s 2008 BEE deal, which was worth R7.5bn, gave its black shareholders only 6.25% of the company, far short of the 30% that is the new target for black ownership set in the draft code.
Given the congenital secrecy of the oil industry, it is remarkable that Chevron South Africa has allowed two senior managers to respond to the anguish of 70 or more Caltex service station operators at the way their contracts have been handled or cancelled.
The usual way of dealing with matters that have become public is to shield top managers behind statements issued by the media spokesperson. In the US, they call this “plausible deniability”. Thus if the statements are economical with the truth, or just plain wrong, they can always be denied. Senior heads are below the parapet. The buck does not stop at the top. It flies over. Another way is to keep opponents in court until they run out of money and retire broke. One hopes irate Caltex dealers are aware of this tactic.
On the other hand, the aggrieved dealers might club together in a class action. The more of them there are behind a court challenge, the more the smoke thickens, and of course the more suspicion that there must be a fire. This is best described as “Many Davids versus one Goliath”.
FCB Africa has concluded a BBBEE deal that it believes will have a profoundly positive influence on young black women as well as a major impact on South Africa’s economy in the years ahead.
In terms of the deal, which has an effective date of Tuesday, 1 December 2015, the Maharishi Institute in Johannesburg has acquired 15% of FCB Africa. The deal boosts FCB’s total black ownership to over 51% and rockets its total black female ownership to over 31%.
These shares will be held in a broad-based black economic empowerment trust, and 100% of all profits made in respect of these shares, once they are paid off, will be used to empower unemployed young women who will own an equity stake in the company, with a comprehensive career package that facilitates true lifelong empowerment, including access to university-level business degrees with a specialisation in advertising and digital marketing, industry-recognised vocational skills qualifications, full-time employment, personal development, soft skills training and ongoing hands-on coaching and mentorship.This holistic approach with a range of other support measures over a number of years, will assist these women to become measurably successful in South Africa’s economy. The move is targeted to strengthen the long-term pipeline of new industry professionals.
JOHANNESBURG (miningweekly.com) – African Rainbow Minerals (ARM) plans to restructure the shareholding of its broad-based economic empowerment (BBEE) trust, as the financial covenants of a loan remain under pressure. ARM was required to increase its guarantees from R700-million to R850-million to support the financial covenants of the 2005 Nedbank loan that allowed the trust to acquire 28.6-million ARM shares from Harmony Gold, which had also provided R150-million in guarantees to the bank. The financial covenants of the Nedbank loan came under pressure owing to the decrease in ARM’s share price on the back of weakened commodity prices and the overall negative sentiment towards the mining sector.