No BEE exclusions for multinationals

Johannesburg, 10 May 2004

The ICT empowerment charter working group has released its third draft of the charter, this time containing long-awaited targets for black economic empowerment (BEE) in the industry.

Key recommendations include that multinationals not be excluded from equity ownership targets, and that preferential procurement have a higher weighting than on the government`s scorecard for all industry.

Releasing the targets at a news briefing in Johannesburg today, Dali Mpofu, chairman of the charter working group, said the sector believed there should be no exclusions in the equity ownership debate, meaning that multinationals will not be excluded on the equity ownership issue.

However, Mpofu said the working group would consult with multinationals this month. He hinted that a possible solution was on the horizon, and that multinationals should not be overly concerned.

One area where the ICT industry`s proposed charter targets differs from the government scorecards is that it has increased the weighting on preferential procurement to 22 points, compared to the government`s 20. In line with this target, between 30% and 60% of all procurement will have to be from black-owned business by 2009. By 2014, this must increase to 50% - 80%. Mpofu said this is a key recommendation, because this is where job creation will occur.

In the residual category (bridging the digital divide), the ICT charter working group has given it 11 points to the government`s 10 - with corporate social investment making up only a small part of this.

Mpofu feels the proposed targets are attainable by most companies. "If you do the bare minimum, achieving only 50 points of a possible 100, you will be classified as an empowered company and you will receive a bronze certificate. Between 66 and 79 points will earn a company a silver certificate, and over 80 points will earn a company a gold certificate."

He said the aim of varied certification was to encourage companies to continually strive to do more than the minimum.

The latest version was released today ahead of another indaba on the issue at Vodaworld north of Johannesburg on Friday.

Earlier versions of the draft charter excluded targets because the working group said it wanted the ICT industry to cover the proposed principles of BEE before it got bogged down in discussing specifics.

The targets were formulated from submissions from the industry associations after workshops with their members. They are being released today to give players the opportunity to formulate responses ahead of Friday`s indaba.