Dti clarifies revised B-BBEE codes

Friday, November 9, 2012

Pretoria - The Department of Trade and Industry has clarified media reports stating that the revised Broad-Based Black Economic Empowerment (B-BBEE) Codes could ruin charities, saying the B-BBEE process contributes to economic transformation while seeking to create an equitable society.

"The Department has noted with great concern media reports and public misunderstanding claiming that the B-BBEE codes, in particular Statement 500 - Socio Economic Development, could ruin charities.

"BBBEE is an integrated and coherent socio-economic process that directly contributes to the economic transformation of South Africa and seeks to create a just and equitable society," said the department on Thursday.

Last week, some media reported that charities could face ruin over a government proposal that firms could lose BEE points if they donate to charities that do not have 100% black beneficiaries.

Reports were that some charities believe the proposal means that any firm that donates to a charity that helps a white, coloured or Indian person may not be able to claim points for its BEE scorecard.

The statement that BEE proposal could ruin charities is not true as B-BBEE is intended to empower black people in general, including designated groups like people with disabilities, youth and rural communities, departmental spokesperson Sidwell Medupi said.

"There has never been any deviation from the original beneficiaries as defined in the B-BBEE Act, and the definition in the current B-BBEE Act of black people is a generic term which means Africans, Coloureds and Indians. The beneficiaries of B-BBEE are 'black people' as defined in the BEE Act No.53 of 2003, and the Employment Equity Act No.55 of 1998," explained the department.

The department said the Socio Economic Development (SED) element is addressing socio-economic development initiatives that could be tackled either through monetary or non-monetary contributions with the targeted beneficiaries as is defined in the BEE legislation.

BEE SED was never intended to displace corporate social responsibility/investment of companies, but its intention is to alleviate inherent social challenges confronted by a specific group of the society through no design of theirs as an add on to corporate social responsibility. Thus companies must continue to do their CSI in spite of the BEE SED.

"The principle in the proposed BEE SED element still remains the same except the target has been adjusted to 100% as we are cognisant of the intended objectives of BEE. However, if less than 100% of the full value of the SED contributions directly benefits black people, the value of the contribution made multiplied by the percentage that benefits black people, is recognisable," said the department. - SAnews.gov.za