At the recent BEE and Energy Conference, held at Franschhoek Cellars on 23 May, the main theme was echoed by the words of BEE Charter Council Chairperson, Margaret Mohapi, “Businesses should stop being afraid of BEE and rather embrace it.”
In keeping with this sentiment, Madelaine Adams, HR manager at DGB, explained DGB’s B-BBEE journey and how they adopted a multi-element B-BBEE strategy to improve their level and rating. Madelaine started by saying that they used BEE consultants to understand the code better and to translate it into the scorecard for DGB. She notes that they went from 23 to 43 points by merely reporting better. Madelaine further shared other examples about how they improved their enterprise and supplier development, skills development, and socio-economic development.
“We decided to first address our main faults, to do better and we made some changes. We first looked at the YES (Youth Employment Service) programme to improve our scorecard and signed up our seasonal workers, which in turn drew lots of benefits,” Madelaine says. “We then absorbed candidates from our YES programme into junior positions at DGB.”
On skills development, Madelaine says that they now capture all data related to skills development and on the job training – which they were already implementing but since there was no record keeping, they could not be awarded the points. DGB also invests in disabled learners to get long tax breaks and rebates. In terms of enterprise development, it has been one of Madelaine’s greatest joys to host the black brands and assist them with establishing and growing their respective businesses.
Procurement, especially grape procurement is currently still proving to be the biggest challenge for DGB to get their various farmers BEE-certified. In the greater market of informed consumers that think and consider who they’re buying from, DGB found it necessary to either change their grape suppliers or convert suppliers to being compliant. She says that it causes a chain effect when you get your suppliers on board as it further promotes BEE. “Yes, BEE has lots of data capturing and additional admin, but it is worth it when you see what difference it makes when you create opportunities for others,” Madelaine concluded.
Hansie Fourie, BEE consultant for DGB, followed on Madelaine’s case study by saying that it was important to understand why BEE exists and why it was created in the first place. From a commercial perspective it must make business sense. “The strategy says that addressing inequalities in society will broaden the economic base. Once you understand the why, it’s easy to navigate and implement the how,” Hansie explains.
“Misunderstandings of BEE and transformation creates the animosity. BEE is not compulsory, but it is driven by market forces. Embrace the process as it has a meaningful outcome,” Hansie continues. “A total of 10% of net profit after tax spent on BEE can be recovered by up to 99% from SARS. Meaning that being compliant doesn’t cost you a thing.”
Yuneal Padayachy, acting Chief Support Executive of the BEE Chamber, presented an insightful talk on how to gain two levels on your BEE Scorecard by participating in a YES programme. The YES programme initially came about as a need arose to address employment gaps in South Africa, where there’s especially a big youth unemployment problem. The initiative aims to address industry specific challenges.
According to Yuneal, the business sense behind the YES initiative is succession planning for a company going forward and the overall objective is creating jobs. These positions can take the form of graduate development programmes and need to have a guaranteed 12-month quality work-based experience. Affording youth, the opportunity to gain experience helps them towards further future job opportunities. Absorption options such as permanent employment in the company with no defined end date is the end goal.
Overall, the day offered insight into better serving your BEE strategy and becoming compliant and improving your scorecard in the long run.
