Pen, J.C. Van Der Linde & Venter projects, BEE Analyst & eSTUDY Partnership

The value proposition of Black Economic Empowerment investment via
NPO Partnerships: BEE Instrumental in rewriting life stories while
optimizing BEE Levels

The latter end of 2017 gave way to a symbiotic venture created
between an inspirational NPO, a successful construction
company, a visionary BEE consulting firm and cutting-edge
digital training provider. Read more.

In the News

President Cyril Ramaphosa told Members of Parliament on Thursday that government would not scrap the broad-based black economic empowerment, although he acknowledged that the policy had been slow in achieving the economic transformation it was intended to.

Read more.

Skills Development: Diagnose, Plan, Act

Now that we have a clearer understanding of the benefits awaiting those organisations able to embrace Skills Development as a non-negotiable BEE compliance strategy, our next endeavours should revolve around diagnosing, planning and then jumping into skills development action mode.

Current Status and Future Planning

Inaugurating your skills development strategy should commence with a ‘’where are we now’’ exercise, aka the Skills Audit. While the word “audit” may bring about nightmares of black and white suits, staring at you unapprovingly from behind their laptops while you are trying to make excuses for gaps of noncompliance, this reality check is necessary for you to move forward.

An audit is necessary to provide actual figures and metrics to compare with required BEE targets. The pain (and fines) for not complying is far worse than coming to terms with the BEE voids in the company.

The skills-based audit exercise will also amplify the exact training requirements of your organisation as to align future spending to those areas where maximum gains can be earned regarding BEE points and also monetary benefits in the forms of rebates and grants.

Once the skills needs analysis is complete, the structuring of your Skills Development plan can begin. Noted, this may be quite a lengthy exercise of setting up learnerships, creating internship programmes, designing short courses and establishing bursary initiatives. While there is no A for effort awarded during this stage, the “BEE” scored received will be well worth the struggle.

Say YES to the Skills Development Element

Considering the economic “almost” recession we find ourselves in these days, money certainly does not grow on trees especially for the SME business sector. Hence, you need the most “BEE bang for your buck” when investing in skills development and learning activities

The YES initiative aligns perfectly with the B-BBEE Codes of Good Practice and by participating in this programme your company can significantly improve its BEE Rating.

By achieving YES targets either by offering internships to unemployed youths or with the sponsorship of unemployed youth stipends at another company, one can move up one recognition level on scorecard. For the overachievers exceeding the YES minimum requirements by achieving double on the target, will result in moving up two recognition levels on the scorecard.

Follow the Leaders

When in doubt, just follow the leaders. A skills development strategy reaches beyond traditional in-house training and development mechanisms. Some organisations have made tremendous inroads towards maximising their efforts in the Skills Development Element of the BEE scorecard, during the last couple of years:

1) Learnership to Permanent

  • South African Breweries is empowering youngsters through learnerships and training programmes as per the guidelines of the BEE Act, but with a twist. These learners are in fact offered permanent employment long before their learnerships come to an end, which enable them to start contributing to the SAB business environment and provides them immediate job security.
  • These learnerships are open to all graduates with a B average attained at university. The SAB Learnership programme is a perfect example of how business in South Africa can create new pathways for full-time employment.

2) Secondary and Tertiary Bursaries

  • Sponsoring employees or non-employees via bursaries to complete a tertiary qualification is deemed as contributions towards the Skills Development Element and improve overall BEE status. Paying for a black individual’s secondary education also counts towards skills development points.
  • Old Mutual established their School Grant Fund in 2015 together with the Public Investment Corporation and the Government Employees Pension Fund as outside partners. In the three years of operation, this fund has awarded over 60 bursaries to previously disadvantaged individuals.
  • Nestle boosts their skills development score by offering bursary schemes for employee’s children, to study at an accredited university up to undergraduate level.

3) Upskilling the Community

  • Medium-sized enterprises are often subject to the challenge of capacity availability where internship or learnership intakes are concerned. Fortunately, the skills development pillar allows for companies to earn points when involved in community upskilling projects.
  • T-Systems has made a sizable investment in the form of a Digital Learning Centre in Hazyview, with the aim to develop critical IT, English and Tourism skills within members of the community in Hazyview, as well as surrounding areas.

4) Funding Independent Training, Mentorship & Incubator Programmes

  • Sometimes its just easier to give money and be done with it. Well, you can still earn Skills Development points by providing funds to Training Platforms and Mentorship Programmes such as those offered by the South African Institute for Entrepreneurship (SAIE).
  • Companies like ABSA, Anglo American, Astrapak and Coronation allocate funding to the SAIE for the development of training materials, courses, workshops and mentorship alliances in critical areas such as education, agriculture, information technology and enterprise development.
  • Heineken contributes to its skills development goals by sponsoring candidates to partake in entrepreneurial training and development hubs (incubators) running for a ten month period each year.

5) Think Global, Act Local

Quite a fitting tagline for Investec’s SATRep’s Global Exposure programme to train and develop young entrepreneurs by exposing them to global business thinking practices. Selected applicants are sent on a week-long trip to an international destination to meet and engage with influencers from leading companies in a specific business field or industry.

These exposure ventures aim to provide youngsters with an opportunity to experience international business firsthand and return with global insights, learning innovation, potential funding prospects and collaborative partnerships to take their businesses forward.

6) Work Readiness Programmes

You don’t have to be in training to provide training. Global consulting firm Mazars is mostly known for their accounting, risk management and actuarial consulting services. However, they are making a valuable contribution to skills development and learning with their Job Readiness Training Programme which offers an extensive 60-day course to unemployed youths as a method to prepare them for their future world of work. They present programmes in Durban, Gauteng and Cape Town.

Negative Narratives into Positive Prospects

According to the Deloitte Human Capital Trends report of 2017, only 28% of organisations in South Africa are actively involved in skills development initiatives. The concept of BEE is often subject to negativity, apathy and a reluctance to participate to such an extent that its positive prospects in terms of business sustainability are often overlooked or ignored.

To overcome our adversities of poverty, unemployment and economic regression, embracing skills development as a viable solution to create prosperity should definitely be on the 2019 New Year’s Resolution list for businesses in South Africa.

Skills Development: Good for Business, Good for BEE

The skills disconnect is becoming more and more evident as traditional approaches to training and education are not responsive enough to keep up with the fast pace of changing business conduct. Technological advancement, consumer behavioural changes and the emergence of new competitive entrants into the marketplace on a daily basis, is forcing us to re-evaluate development, learning and training strategies sooner rather than later.

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Revised CA Sector B-BBEE Code Draft published

The Department of Trade and Industry, has gazetted the revised Chartered Accountancy Profession B-BBEE Sector Code (CA Charter) for public comment. The aim of the revised code is to empower and grow the number of Black people in the chartered accountancy profession.

Revisions to the Code include drastic changes to the skills development element.

Individuals who want to comment on the new CA Charter, should e-mail the DTI (for the attention of Sipho Solfafa) at cacode@thedti.gov.za by no later than 26 June 2019.

See full CA Charter here.

BEE Council Encourages Best Practice

The Broad Based Black Economic Empowerment (BBBEE) Advisory Council has called for the declaration of a Transformation Week in the country to showcase best B-BBEE practice.

“There was consensus at the meeting that there is a need to declare a Transformation Week in the country to showcase best B-BBEE practice, create awareness, and educate, with platform to share progress and introspect regarding economic transformation,” said the Council.

Council held its meeting, chaired by Trade and Industry Minister Rob Davies on behalf of President Cyril Ramaphosa on Friday.

The B-BBEE Advisory Council is a body appointed by the President in terms of the B-BBEE legislation to advise him and government on B-BBEE and transformation of the South African economy in order to achieve an inclusive economy.

The collective also acknowledged that the country’s procurement laws need to be strengthened to embed B-BBEE compliance in their content.

Successes

Friday’s meeting recognised that progress has been made in the implantation of B-BBEE policy over the last five years.

The Black Industrialist Programme, noted the meeting is among one of the achievements of that can be counted. The programme intends to create majority black-owned entities in the productive sectors. To date the Department of Trade and Industry (dti) has supported 138 beneficiaries.

The meeting held at the dti campus in the capital, also counted the establishment of the B-BBEE Commission to effectively monitor implementation and progress as one of the other successes.

“Understanding the primacy of B-BBEE in the government’s drive to effect fundamental change and economic redistribution, the Council discussed and number of issues that have an effect on the implementation of B-BBEEE,” it said.

Financing

Issues discussed at the meeting include the role of development financing institutions (DFIs) in financing and supporting empowerment. The gathering stresses that the role of DFIs, should be complemented by the financial sector to intensify funding for B-BBEE as per the commitment of the Financial Services Charter.

The Preliminary report of the B-BBEE Commission showed that vendor-financing is higher, followed by funding financial institutions in respect of major B-BBEE deals already registered, with government funding being the lowest.

It added that focus should be placed on financing SMMEs and Black Industrialists, particularly those in the productive sectors.

The Council emphasised the need to intensify efforts of ensuring that SMMEs get markets to sell their wares, and also appreciated the significance of public and private sector partnerships in this regard.

The Council also mulled on the appropriate way to utilise the 30% as contained in the procurement policies to empower SMMEs in local communities.

Transformation, fronting

The collective acknowledged the veracity of the economic transformation work that still need to be advocated in society to educate and ensure increased B-BBEE compliance.

On black ownership target, the Council said the 25% target should be inclusive of active participation of the beneficiaries and not passive involvement.

In the same breath, the Council raised concern on the usage of broad-based ownership schemes, the abuse of the third party for enterprise development, supplier development and skills development.

It also expressed concern about the non-participation of black shareholders and directors in 51% black owned structures.

Acknowledging that fronting is becoming more sophisticated aided by consultants and verification agencies in the market, the Council urged government to finalise the development of regulation for verification agencies and B-BBEE practitioners to complement the work of the B-BBEE Commission and South African National Accreditation System. – SAnews.gov.za

SAQA welcomes NQF Ammendment Bill

The South African Qualifications Authority (SAQA) has commended the role players who have worked to get the National Qualifications Framework (NQF) Amendment Bill through Parliamentary processes.

SAQA on Monday thanked Higher Education and Training Minister Naledi Pandor and the Portfolio Committee on Higher Education and Training for being at the forefront of the amendment bill, which is now awaiting the President’s signature.

The NQF Amendment Bill aims to protect the integrity of the South African education and training system by giving SAQA the legal responsibility to verify qualifications and part-qualifications (an assessed unit of learning that is registered as part of a qualification).

The bill makes provision for the registration by the Higher Education and Training Department of all private education institutions and skills development providers, as well as for the accreditation of these providers by the Quality Councils.

It further makes provision for organs of State, employers, education institutions, skills development providers and Quality Councils to refer qualifications and part-qualifications to SAQA for verification and evaluation.

The bill also provides for the formulation of criteria for evaluating foreign qualifications.

“This means that in the case of national qualifications and part-qualifications, SAQA must verify that they are authentic. In the case of foreign qualifications, SAQA must first verify that they are authentic and then compare them with South African qualifications for placement within the South African NQF. By so doing, the quality of both national and foreign qualifications would be protected.

“The bill clearly defines authentic qualifications and part-qualifications. It also defines misrepresented as well as fraudulent qualifications. In the event that a qualification or part-qualification is found to be misrepresented or fraudulent, it will appear in the register of misrepresented qualifications and part-qualifications or fraudulent qualifications and part-qualifications. This will deter would-be qualification fraudsters from misrepresenting qualifications,” SAQA CEO Joe Samuels explained.

Another form of deterrent is the imposition of penalties to not only the qualification fraudsters but also to education institutions and skills development providers that falsely claim that they are registered and accredited to offer qualifications and part-qualifications, Samuels said.

“Hence, it is a criminal offence for an education institution or education skills provider to falsely claim to be registered and accredited, let alone offer qualifications that are not registered on the NQF. The penalties range from five to 10 years imprisonment or a fine or both. This means that learners will not be taken for a ride by unscrupulous providers,” Samuels said.

The penalties are not limited to qualification holders and providers but, also extend to anyone who makes or causes a false entry into the National Learners’ Records Database or the misrepresented or fraudulent database.

Samuels welcomed the changes brought about by the bill as they seek to protect the public against unscrupulous education and training providers, and also protect government and businesses from hiring people who do not have authentic qualifications.

“SAQA will continue to work together with all stakeholders to ensure that the quality of our education system is maintained and enhanced. SAQA will also ensure that once the bill is signed into law, it will be implemented for the benefit of all living in South Africa,” Samuels said. – SAnews.gov.za