Siemens challenges other multinationals

By Kaunda Chama for Siemens
Johannesburg, 01 Apr 2005

New Siemens Southern Africa CEO Pete da Silva has challenged multinationals to embrace the reality of the South African trading environment and take equity selling to black economic empowerment (BEE) partners as a reasonable reality.

He made these comments last night when the company presented its first South African Siemens supplier of the year award to BEE company Dartcom, for what he said was its commitment to excellence and outstanding performance.

Dartcom is a provider of fibre optic cable and power technology and products.

Speaking at the presentation, Da Silva explained that although a BEE business partner won the award, empowerment companies go through the same stringent assessment as their non-empowerment counterparts.

He pointed out that his company is over 150 years old, and has had a presence in the southern African region for about 106 of those; testimony that it is committed to being part of development in Africa.

"I strongly think that BEE issues should be top of every company's agenda by now," he noted.

Da Silva added that he finds it strange that multinationals still have issues with equity stake selling in 2005, when Siemens started negotiations for selling off part of its operations in the mid-1990s.

Siemens Southern Africa sold off 13% to Sekunjalo Investment Holdings in 2001 and another 13% to New Africa Millennium Telecommunications in early 2002, making Siemens Southern Africa 26% black-owned. "This showed that we wanted to do so and were not just being forced to do so by some rule or regulation."

He was reacting to reports that have been in the press from the middle of last year that numerous multinationals opted against selling off equity stakes to local companies.

"This is how the future is going to be; companies have to embrace different ethnic issues in the regions they operate," he noted.

Last year, half a billion of the company's R1.2 billion procurement spend went directly to BEE suppliers.

Da Silva concluded that in terms of empowerment charters, Siemens seems to be caught in the middle of numerous charters because of the broad range of its products, but will continue with its own strategic intent while keeping its eye on the charter.