Motorola mulls BEE

By Leon Engelbrecht for Motorola
Johannesburg, 10 Dec 2007

Motorola is mulling a black empowerment equivalency deal. "We`re looking at some equivalent options and hope to have an update early in the new year," says Jacqui O`Sullivan, Motorola`s Middle East and Africa regional communications manager.

She adds that last week`s changing of the guard at the company will not affect its African plans.

"Ed Zander has often spoken of the importance of succession planning and we are confident in the appointment of Greg Brown to the position of CEO. We believe Greg has the strategic insight, operational experience and inspirational leadership style, to accelerate and grow Motorola into 2008 and beyond," O`Sullivan adds.

"Within the African context, we continue to push to our agenda, to connect the unconnected and provide a combination of products and services that will help continue the development of the continent."

Black empowerment equivalency deals are controversial. After HP took the lead earlier this year, Black Management Forum president Jimmy Manyi urged government to thoroughly investigate multinationals choosing this option.

In August, Business Day said the Department of Trade and Industry`s BEE codes of good practice excuse multinationals from the obligation to sell equity in their local operations, provided they can demonstrate this is global policy and they have not made any such disposals elsewhere.

Last month, HP launched a Business Institute as part of its equity equivalency deal, promising to assist about 300 identified SME businesses over the next six to seven years, with 1 000 graduate learnerships and short skills programmes for 800 employees.

The venture received the blessing of president Thabo Mbeki, at his Presidential International Advisory Council on Information Society and Development, in August.

But the DTI`s codes are minimum standards and some entities have set tougher benchmarks that could imperil the business of companies opting for equivalency deals.

Telkom, for example, expects all vendors, including multinationals, to have a 30% BEE shareholding to qualify for business. The company`s acting procurement group executive Elelwani Pahlana last month said SA`s legislative framework allowed the company to set its own procurement and BEE requirements for its suppliers, whether they are local or multinational.

She said Telkom was committed to growing the skills base, as well as retaining economic interest within the country. "While some of our suppliers have already complied with Telkom`s BEE requirements, others are in the process of doing so by committing to the company`s BEE commitment plan."