Do companies in South Africa have to be B-BBEE compliant? The answer is No, they don’t have to be compliant legally speaking, but there are good commercial reasons why South African companies should be compliant. Here are three such reasons:
- Clients will request a B-BBEE certificate and may take their business elsewhere if the company is non-compliant.
- If the company wants to be eligible for any government work, they will need to have a good B-BBEE scorecard.
- Certain permits and licences are only issued to companies with a good B-BBEE scorecard.
What constitutes a “good” B-BBEE scorecard? This depends on the industry and the situation but generally speaking, a Level Four B-BBEE Contributor status is considered to be a good status but many corporates require their suppliers to be a Level Two B-BBEE Contributor.
So how to achieve a “good” scorecard? This is where companies need the assistance of B-BBEE consultants.
A B-BBEE consultant can ensure a company is B-BBEE compliant in the following ways:
- Amendments to the B-BBEE Codes are continuously being introduced and the legislation has become a quagmire to navigate. It may be difficult for companies to keep track of these changes and particularly their application to their specific industry. B-BBEE consultants keep abreast of all updates and changes introduced and therefore have a wealth of knowledge for companies to draw on.
- Many elements of the B-BBEE Codes are still open to interpretation. B-BBEE Consultants work closely with verification rating agencies and keep abreast of communications from the B-BBEE Commission as well as various Industry Sector Charter Councils to ensure that their advice is in line with accepted interpretation of the Codes.
- The B-BBEE consultant will first understand the objectives of the company and the services it provides and conduct a gap-analysis. The consultant will provide practical bespoke solutions based on the client’s business objectives, taking various aspects into consideration including strategic business, legal, HR and consumer perspectives.
- B-BBEE consultants educate their clients during the consultation process, creating a powerful, value-adding partnership. The more the B-BBEE consultant understands about the client’s business and objectives, the more effective the outcome will be.
- Many B-BBEE initiatives fail because the correct documentation or evidence is not in place or the initiatives were not structured appropriately at the outset. Using a B-BBEE consultant ensures that each B-BBEE Rand spent achieves the desired objective.
- Putting a strategy in place is just the first step. Implementing the strategy takes time. B-BBEE consultants can assist with the implementation of solutions in an efficient and productive manner to save precious resources and time.
- To become B-BBEE compliant, the company must keep proper records. The B-BBEE consultant will collate all the evidence in electronic format over the course of the period so that there are no issues at the end of the financial period.
To close the loop, B-BBEE consultants represent and assist their clients during the verification process from arranging quotations from reputable verification rating agencies to submission of documentation and representation at the on-site verification. Should any matters of interpretation arise, the B-BBEE consultant will submit arguments to support the company’s case.