The Department of Trade and Industry (DTI) on 02/10/12 opened a 60-day period for comment on the revised Broad-based Black Economic Empowerment (B-BBEE) Codes of Good Practice. Some of the preliminary information that was presented at the launch of these Draft Codes is as follows:
1. THRESHOLDS
The annual revenue thresholds to be measured as an Exempted Micro Enterprise (EME), or as a Qualifying Small Enterprise (QSE) have been adjusted:
- EME’s increasing from R5 million to R10 million
- QSE’s increasing from between R5 million and R35 million, to R10 million and R50 million
2. SCORECARD ELEMENTS REDUCED FROM 7 TO 5
The current generic scorecard contains seven elements and these have been reduced to five, with a total of 105 points assigned to the five elements. NB: All companies, except EME’s, are to comply with all the elements of the scorecard.
3. SOME SPECIFICS
Below are some challenges companies may have to address if these Draft Codes are gazetted unchanged:
- Ownership:
This element is given greater recognition – points increase from 20 to 25. - Management Control (includes the old Management and Employment Equity):
Less points, 15 now, whereas previously the 2 elements were worth 25 points together. Also, the sub-category ‘Junior Management’ measured under Employment Equity previously, has been removed and only 2 levels, senior and middle management, are now to be measured. - Skills Development:
Still worth 20 points, but 5 bonus points can now also be scored. There is greater recognition for implementing Learnerships and Apprenticeships, i.e., a total of 8 out of the 20 points, and the 5 bonus points for “Learner Absorption” (presumably for employing them at the end of the learnership period). - Enterprise and Supplier Development (includes the old Preferential Procurement and Enterprise Development elements):
Together worth 40 points (previously 35). Significantly, 13 of the 25 points allocated to procurement are for buying from Black/Black women owned suppliers. Perhaps more importantly, recognition will only be for procurement from value-adding suppliers (i.e., to obtain value-added status, the sum of total labour costs together with net profit before tax must exceed 25% of total revenue). In addition, up to 6 bonus points can be obtained new venture and job creation. - Socio-economic Development:
Still worth 5 points on the Scorecard. There appears to be a shift towards emphasising training and mentoring persons to improve their capacity to work and for self-employment. Once we have the full draft Codes, we will elaborate on this.
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