B-BBEE In A Nutshell

Working together towards the highest optimal result.

What is B-BBEE?

With our extensive and impressive track record, we are able to optimise your level of B-BBEE compliance.

B-BBEE is an important consideration for any business operating in South Africa.

Companies wanting to do business with any government institution or major corporate companies will have to be B-BBEE certified.

Suppliers to these entities will in turn require their suppliers to be suitably accredited.

The need for valid B-BBEE documentation is therefore vital for all levels of businesses.

Broad based Black Economic Empowerment is a mechanism intended to improve the levels of participation in the economy by South Africans who were previously disadvantaged.

It is a business reality and will progressively become a requirement for securing future work and in some cases a deciding factor when clients select a supplier.

Every time a customer requests your B-BBEE certificate you risk losing business by not responding.

Decoding has a significant database of B-BBEE certificates which are continually updated to ensure all certificates remain valid. If you are in need of improving your procurement score, our database and services can give you a head-start. We are also able to collect certificates from your suppliers on your behalf.

You get different level BEE certificates, from Level 1— 8, depending on what contributions you have made to support the integration of black people into the economy.

The better the contribution level you have, the more BEE points your clients/customers can claim.

B-BBEE Certificates and Scorecard (Implemented as of 1 May 2015)

Start-up companies OR companies with a turnover of R10mil or less per annum.

EME’s are exempted from having to comply with the B-BBEE Codes of Good Practise and therefore do not need to be rated on a scorecard.

An Exempted Micro-Enterprise which is less than 51% black owned is deemed to have a B-BBEE status of “Level 4” having a B-BBEE recognition level of 100%.

An Exempted Micro-Enterprise which is 100% Black owned qualifies for a “Level 1” having a B-BBEE recognition level of 135%.

An Exempted Micro-Enterprise which is 51% or more Black owned qualifies for a “Level 2” having a B-BBEE recognition level of 125%.

An Exempted Micro-Enterprise is allowed to be measured on a scorecard if the company would like to maximize their Points and move to a higher B-BBEE recognition level.

All companies with a turnover between R10mil and R50mil per annum.

A Qualifying Small Enterprise which is 100% Black owned qualifies for a “Level 1” having a B-BBEE recognition level of 135%.

A Qualifying Small Enterprise which is 51% and more Black owned qualifies for a “Level 2” having a B-BBEE recognition level of 125%.

A Qualifying Small Enterprise is required to comply with 4 elements, namely, Ownership, Management Control, Socio-Economic Development and the 4th element the company will have to choose the strongest element between Skills Development and Enterprise & Supplier Development.

The total score out of 100 will determine the recognition level.

Companies with a turnover greater than R50mil per annum

These companies are rated on all 5 elements, each with a different weighting point score.

The total score out of 100 will determine the recognition level.

OWNERSHIP:

This measures the percentage of shares in the business that are owned by black people.

Definition of black people:

“Black people” means African, Coloured or Indian persons; who are natural persons and:

  • Are citizens of the Republic of South Africa by birth or descent; or
  • Are citizens of the Republic of South Africa by naturalisation before the commencement date of the Constitution of the Republic of South Africa Act of 1993; or
  • Became citizens of the Republic of South Africa after the commencement date of the Constitution of the Republic of South Africa Act of 1993, but who, but for the Apartheid policy that has been in place prior to that date , would have been entitled to acquire citizenship by naturalisation prior to that date .

MANAGEMENT CONTROL:

Measures the effective control of entities by Black People.

SKILL DEVELOPMENT:

Measures the extent to which employers carry out initiatives designs to develop the competencies of Black employees and Black people internally and externally.

ENTERPRISE AND SUPPLIER DEVELOPMENT:

Measures the extinct to to which entities buy goods and services from Empowering Suppliers with strong B-BBEE recognition levels.

This element also measures the extent to to which enterprises carry out Supplier Development and Enterprise Development initiatives intended to assist and accelerate the growth and sustainability of Black Enterprises.

SOCIO ECONOMIC DEVELOPMENT:

Measures the extent to which entities carry out the initiatives that contribute to socio-economic development.

From B-BBEE consulting to procurement database management; We are sure to provide our clients with world class services.