Definition: Black means African black, coloured or Indian people who ARE South African citizens by birth or became a South African citizen before 27th April 1994.

NB the definition of coloured now also includes Chinese

1. Ownership - this measures the percentage of shares in the business that are owned by black people (as per the definition above)
2. Management - the directors and top management of the business
3. Employment equity - the employees in the business
4. Skills development - this measures the amount of money spent of training of black employees
5. Procurement - your suppliers and their scores
6. Enterprise Development - your spend on helping other black owned enterprises
7. Socio-Economic Development - your spend on assisting charitable organisations

 

Points	Level
Above 100 points	Level 1
85-100 Points	Level 2
75-85 Points	Level 3
65-75 Points	Level 4
55-65 Points	Level 5
45-55 Points	Level 6
40-45 Points	Level 7
30-40 Points	Level 8
Less than 30 Points	Non-compliant

 

 

The codes define three types of companies;

EME below R5million
EME - exempt micro enterprise - a company that has an annual turnover of less than R5 million. These companies are automatically given a BEE score of 65 points (level 4), and if majority black owned, level 3

QSE between R5million and R35million
QSE - Qualifying Small Enterprise - an enterprise with an annual turnover of between R5 million and R35 million. The QSE will need to fill in a scorecard, but must choose only 4 of the 7 elements.

Generic above R35million
Generic - all companies with a turnover above R35 million per annum. They need to comply with the seven elements of broad based black economic empowerment.

In brief, the QSE scorecard has the following components and points available:

 

 

 

 

 

 

 

 

Broad-Based Black Economic empowerment emphasises all aspects of business and society. Each element is worth 25 points on the scorecard. As a QSE (Qualifying Small Enterprise) you can select any four of the seven elements.

In brief, the generic scorecard has the following components and points available:

 

 

 

 

 

 

 

Notes:
Broad-Based Black Economic empowerment emphasises all aspects of business and society. Each element is worth between 5 and 20 points on the scorecard. In order to maximise your points, you will need to try to comply with all seven elements.

1. There are currently no accredited verification agencies.
2. It is not mandatory to use a verification agency, though it does ad credibility to your scorecard.
3. The verification agency is not allowed to consult to you. Their only job is to verify the accuracy of the information presented to them.
4. If you do not have accurate evidence you will earn no points!

1. Learn about BEE
2. Look at where BEE is likely to affect you
3. Look at the indicators to find ways of scoring points
4. Collect documents around the indicators where points can be scored
5. Do an initial calculation to find out how many points you have achieved
6. Design your BEE report, Scorecard, Profiles, policies and Strategies around BEE and display your scorecard level
7. Spend time and effort and earn the points
8. Do a final self rating - must be signed once you are completely happy with it
9. Look for ways to find more points on the scorecard
10. Not mandatory - get an independent organisation to sign off your scorecard (Auditors or Rating Agencies)

We can help you with all aspects of the 10 step process. Although we are not a verification agency, we will happily recommend one once you are ready and want a verification.

The only direct reason you will need a scorecard is because your customers are asking for one. If you don't respond you will not be penalised legally but rather potentially not get the business you desire.

EG Socio-economic Development

Goal - spend 1% NPAT of SED to black people
Target 1% NPAT
Points 5

If you spend 0.5% you will earn 0.5/1% NPAT * 5 points = 2.5

A) No, if that is all you do you will be non compliant. The scorecard is broad based. This means you need to do other projects to do well on your scorecard.

A) You will not get fined or go to jail if you do not comply. You simply run a risk of not getting the business you desire.

A) BEE does not have a registration process. You comply by producing a BBBEE Scorecard. The scorecard will allow you to earn points which inturn will help your customers calculate their own BEE scorecard. Once you have produced a scorecard you can advertise that rating. This may require a registration of a directory which will only happen after you have produced the BEE scorecard.

A) As many as your customers need or more than your competition. It depends on your requirements, some industries will need a very high score while others may not even ever need a BEE scorecard. Also note that it takes times to get a good BEE Scorecard. We estimate that the current average score in the marketplace is less than 40 points.

A) The rating is the last step, if you have prepared all your documentation and have earned enough points to get to the level that you require then contact a rating agency - we are consultants, we can however refer you to a verification agency. If you are starting this process then you need to prepare first. Start with a training session, then prepare your own internal scorecard, earn your points, collect documentation and then start the verification process.

A) If you want a very quick scorecard, you can, but you will not earn any points on it. A scorecard can take some time to prepare. We suggest that you start with understanding BEE, then produce an internal scorecard.

You qualify as an Exempt Micro Enterprise - EME. EME's are exempt from BEE.

What does this mean to you - EME's are automatically allocated a good BEE score. You will qualify as BEE compliant (minimum level 4) simply by having a turnover below R5 million.

The proof for an EME is very simple, we can also assist EME's to draw up the correct documentation. If you are below R5 million our EME Pack will be ideal for your business.

You qualify as an Qualifying Small Enterprise or a Generic Company

QSE

QSE's need to produce a Broad Based BEE scorecard. They have a simplified scorecard - they can choose any 4 of the 7 available elements. A QSE has a turnover between R5million and R35million.

Generic company

Generic companies comply with all seven elements
What does this mean to you - QSE's have an easier scorecard. The do not need to score points in all 7 elements to earn 100 points. In comparison a QSE will earn twice the number of points a generic can by doing exactly the elements.

When a company creates a scorecard they are going to need to understand the BEE scorecard, document their activities and promote their BEE status to their customers. Ideally a company needs a basic understanding of BEE, critically they will be able to create their own scorecard in preparation for a rating and they will be able to earn additional points by targeting points that are related to their business.

We present short half day courses as well as full day courses on topics around BEE and the implementation/understanding of BEE compliance. In addition we have extremely useful tools to prepare a self assessment or manage the documentation.