Tackling your company’s B-BBEE scorecard often feels like the most daunting of tasks. With this handy guide, it needn’t be. With the right information, advice and tools, you can plan your B-BBEE strategy for 2024 and beyond. Have the mindset to tackle this task in a way which suits your business today, and unlock benefits that will serve you well into the future too.
YES has partnered with market-leading industry specialists, BEE123, on this article, where we’ll be sharing some B-BBEE strategy tips with you, because knowing how to plan a B-BBEE strategy will set you up for success from the outset.
Why is B-BBEE important?
Broad-based black economic empowerment (B-BBEE, or BEE) legislation was implemented as a vehicle to positively effect socio-economic and structural change within the private and public sectors, as well as the broader communities in which they operate. It is one of the methods through which a business can begin to totally transform.
B-BBEE is a transformation tool driven by compliance. A firm can receive points, improving their levels, based on the five elements on the B-BBEE scorecard. This is only one pillar of the government’s economic transformation strategy.
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Get to know the scorecard
Getting to know the key pillars of the scorecard in concept, and how the B-BBEE scorecard is divided, is essential knowledge. There are five basic criteria:
- Ownership
- Management Control
- Skills Development
- Enterprise & Supplier Development (ESD)
- Socio-economic Development (SED)
Each element has a different weighting. For instance, ESD consists of 40 points on the scorecard, whereas Ownership comprises 25 points.
It’s also important to recognise that optimising a company’s B-BBEE scorecard is not simply a question of appreciating the various scorecard weightings. Optimal scorecard management takes into account which elements of the scorecard a business can most effectively realise and what will bring the most practical benefit to the business in the context of its operational objectives, too. It also pays to think carefully about how your company's resources can best be used to achieve maximum results.
Is YES a part of the B-BBEE scorecard?
The YES B-BBEE Level Up benefit is an element that sits outside of the B-BBEE scorecard. However, participation in YES and receipt of level up(s) is dependent on points on the scorecard. In other words, your business needs to be active in B-BBEE and meet certain sub-minimums in order to change lives and benefit. Knowing what opportunities you have to score points on your scorecard can make all the difference to the level you finally achieve.
YES is a great vehicle to help you affect broad-based change, whether your business needs a B-BBEE boost or not. Calculate your target here.
Can my business participate meaningfully in BEE?
Before you begin planning your 2024 strategy, check if you actually need to complete a scorecard for your business. If your business is thinking about B-BBEE compliance for the first time, you may not be aware that not all companies need to worry about completing a B-BBEE scorecard: if a company’s turnover is less than R10 million per year, the business qualifies as an Exempted Micro Enterprise (EME). EMEs are compliant by default.
However, in order to take advantage of your status as an EME, you need a valid EME BEE Certificate. Under current rules, EMEs manage their own EME BEE certificates via an appropriate affidavit.
Automate for ease
Once you understand B-BBEE conceptually, and how your business fits into the broader B-BBEE landscape, you’ll need to calculate your scores.
Fortunately, the days of manual calculations and unwieldy spreadsheets are behind us. B-BBEE Management Software automates the whole process, provides invaluable strategic insights and slashes the time spent on calculating scores – so you can focus on your transformation strategy and its benefit to your organisation.
There is increasing importance being placed on environmental, social and governance (ESG) strategies and the United Nations’ (UN’s) Sustainable Development Goals (SDGs) by global investors and consumers. Between the advent of ESG investment indices and the rise of the intelligent consumer, many are choosing where and what to buy based on an organisation’s transformation, socio-economic and environmental impact.
True transformation, B-BBEE, ESGs and SDGs are all linked, and South African consumers and investors are beginning to see transformation as a catalyst to solve the country’s socio-economic problems. Many corporates are realising the associated benefits these strategies can have on their business.
How YES can help with your transformation goals
Outside of the YES internal model, which places youth inside your business for levels up, YES offers the turnkey solution, which can help you reach your transformation goals, beyond B-BBEE.
A turnkey solution
Traditionally used for organisations looking to gain levels on their B-BBEE scorecard while making an impact in communities, the YES turnkey solution (host partner model), is being taken up more and more, even by Level 1 companies, because of its seamless integration with ESG and SDG strategies.
Essentially, corporates can use the creation of youth jobs to also impact social, environmental and economic issues that align with their holistic transformation strategy.
The turnkey solution works with 28 YES-vetted host partners across South Africa to place youth. If a corporate cannot place youth in their own organisation, they have the option to place youth with our host partner. The host partners are generally NGOs working in high-impact sectors within communities, which means youth do not have to travel far for work and they can play an important part in building their own communities.
Sectors YES host partner work in:
Your business can then create critical youth jobs in sectors that reflect your ESG/SDG strategies. The turnkey solution is a true one-stop-shop for organisations looking to make all of the impact with none of the admin.
YES is a business-led collaboration that seeks out ground-breaking ways, through innovation and technological best practice, to reignite the economy and give youth a dignified first chance. Together with our 1,620+ corporate sign ups, YES has already created over 130,152+ work opportunities for youth in five years years. This translates to R6.8 billion injected into the economy through youth wallets.
The YES 12-month quality work experience equips unemployed youth with a toolkit to be a beacon of hope for their families, households and communities. The CV and reference letter they get at the end of their 12-months gives them a 3 x greater chance of an interview call-back.
You don’t have to do it on your own!
A good partner can make all the difference, not only to your ability to complete your scorecard successfully, but to your overall transformation strategy too.
A number of fantastic BEE agencies work with our clients to help deliver a successful YES programme that fits into their overall B-BBBE strategy such as the co-authors of this blog.
Join the movement
1,620+ companies have already signed on to YES to co-create a future that works. Calculate your target now.
Author Credits:
Simona Mazza
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Martin Smookler
Amendment to the Gazette