Saaff members must align with new BEE codes

JOY ORLEK
THE CODES of Good Practice on Broad-Based Black Economic Empowerment were gazetted last Friday along with the sector charters for the Construction and Finance industries. This follows Cabinet approval in December last year. According to Tony d’Almeida, SA Association of Freight Forwarders board member responsible for education and training and IR director of UTi, clearing and forwarding companies who have based their compliance on the Forwarding and Clearing Industry Charter will need to align with the current generic codes.
He expects it will take at least a year to get the F&C Industry Charter aligned and Saaff will in fact have to decide whether to go ahead with an industry charter at all.
But, he says, for companies that have already achieved compliance with the current charter, this is good news because their compliance efforts are well under way.
“Now that the codes have been gazetted, we know what to align ourselves with – the goals are stable and predictable, and that’s very positive.”
Trade and Industry Minister Mandisi Mpahlwa said that the process of appointing the BEE Advisory Council, to monitor and advise, was now also under way.
He has stressed that in his view the codes will benefit the majority of South Africans and that these benefits will be realised through measures that include encouraging new entrants into business and penalising “fronting”.
The codes allocate 70% of their points to broad-based elements such as enterprise development, skills development, preferential procurement and socio-economic development, and will therefore contribute to more inclusive economic growth, according to the report.
Smaller companies and start-ups in their first year of operations will be exempt from empowerment requirements, while multi-nationals will have flexibility in how they choose to structure their empowerment deals.
The Generic Scorecard awards points amounting to a total of 100 on the seven elements of ownership (20 points), management control (10), employment equity (15), skills development (15), preferential procurement (20), enterprise development (15) and socio-economic development (5).
The element of ownership, for example, requires that 25% plus 1 of a company’s owners with voting rights be black people.
The F&C Charter was negotiated based on the original Codes of Good Practice and the point values applicable to each code at the time. There are a number of changes in the new codes which F&C companies will need to address. While the same points value applies for ownership and management control, employment equity has been increased from 10 to 15 points, for example, and skills development decreased from 20 to 15.