7 November 2016 AMENDED INFORMATION, COMMUNICATION AND TECHNOLOGY SECTOR CHARTER

Transcription

1 7 November 2016 AMENDED INFORMATION, COMMUNICATION AND TECHNOLOGY SECTOR CHARTER Broad-Based Black Economic Empowerment Act (GNC) In terms of Section 9(1) of the Broad-Based Black Economic Empowerment Amendment : info@p-v.co.za

2 General Notes: General: Commentary and Notes to the Amended ICT Codes of 2016 (AICT) The major changes and variations from the old ICT Code or Amended DTI Codes are summarised below. At the time of publishing, there are a number of outstanding queries with the ICT Council/ DTI. As and when clarification is received on the respective queries, updates will be released. While the Generic Code totals 130 points, there are a further 11 bonus points available. The increase in the points to level table is a major deviation from the draft Code and negates the number of greater number of points available in the AICT Code. To understand how this affects your business, please feel free to contact us to arrange a scenario review of your company. The full AICT may be downloaded here: Effective Date: Effective from date of Gazette Notice. All verifications conducted after date of Gazette Notice must be according to Amended ICT Code. Applications have been submitted to the ICT Council and the DTI to permit the application of the Applied for Verification/ Certification principle stipulated by the DTI in 2012 when the various Sector Codes were initially released. Priority Elements: Continued application of Priority Elements: Ownership 40% of Net Value Skills Development The priority targets are split between the headcount and spend targets. Companies are required to achieve 40% of the respective targets to avoid the discounting principle. 40% of S2.1.1 = 40% of the 12 points available 40% of S2.1.2 = 40% of the 8 points available Enterprise and Supplier Development 40% of the Normal points available for Procurement, Enterprise Development and Supplier Development respectively QSE Scorecard: It is noted that the QSE Scorecard does not total the 120 points required to achieve level 1 recognition. This query has been raised with the ICT Council. This inconsistency has been queried with the ICT Council/ DTI. The response from the ICT Council/ DTI will be released once we receive a response. Ownership: Economic Interest and Voting Rights target increased to 30% It appears that the ICT Council has implemented the proposed limitation on recognition from BBOS s, ESOPS, BDG s and Cooperatives to the clarification statement published on the 5 th of May This statement was duly retracted by the DTI in May The ICT Council and the DTI are going to need to clarify their intent on this. Equity Equivalent Programs: Application must be submitted to ICT Council Investment values and periods defined 2016/11/16 2

3 General Notes: Management Control: Commentary and Notes to the Amended ICT Codes of 2016 The application of the Economically Active Population and the overall demographic of Black people is applied to the Generic Scorecard only Skills Development: The application of the Economically Active Population and the overall demographic of Black people is applied to the Generic Scorecard only The Priority Element requirement is split between the headcount and spend targets Training Programs must be targeted at developing BBBEE ICT Sector Council Priority Skills. It is expected that MICT will publish this list. The SAQA recognition of courses may be checked on the SAQA website: Enterprise and Supplier Development: Supplier Development contributions may be made to Supplier, Partners or Vendors Enterprise Development initiatives must support Black owned ICT Business Bonus point recognition for Job Creation is understood to be proportionate to the Beneficiaries workforce. Enhanced spend recognition for spend and/ or long term contracts with Enterprise and Supplier Development beneficiaries. Companies are encouraged to develop and implement an Enterprise and Supplier Development plan. This remains mandatory if imports are to be excluded. Two additional Empowering Supplier requirements have been introduced. Socio-Economic Development: Contributions must be Sector Specific Exempt Micro-Entities (EME s) and Qualifying Small Enterprises (QSE s): EME s are only required to obtain a sworn affidavit to affirm their BBBEE Status QSE s with at least 51% Black Ownership are only required to obtain a sworn affidavit to affirm their BBBEE Status To understand how this affects your business, please feel free to contact us to arrange a scenario review of your company. info@p-v.co.za 2016/11/16 3

4 Scorecard Summary Summary Scorecard Element Code Numbers Ownership* AICT Management Control AICT Skills Development* AICT Enterprise and Supplier Development* AICT 400 Preferential Procurement 25 Supplier Development 10 Enterprise Development 15 Socio-Economic Development AICT (11 Bonus ) Specialised Scorecard Management Control AICT Skills Development* AICT Enterprise and Supplier Development* AICT Socio-Economic Development AICT TOTAL: 107 *Priority Element 40% of target must be achieved Turnover Thresholds Turnover Category Less than R10m or Start up 0-50 % Black Ownership >=51% Black Ownership >=75% Black Ownership >R10m but <R50m >R50m Exempt Micro Enterprise Level 4 Contributor Level 2 Contributor Level 1 Contributor Qualifying Small Enterprise Generic Enterprise B-BBEE Recognition Levels B-BBEE Status Qualification B-BBEE Recognition Level Level One Contributor >= % Level Two Contributor >=115 but < % Level Three Contributor >=110 but < % Level Four Contributor >=100 but < % Level Five Contributor >=95 but <100 80% Level Six Contributor >=90 but <95 60% Level Seven Contributor >=75 but <90 50% Level Eight Contributor >=55 but <75 10% Non-Compliant Contributor <55 0% 2016/11/16 4

5 Ownership AICT Measures effective ownership of companies by black people Indicator Ownership AITC 100 Measurement Category & Criteria Equity Ownership Voting Rights Exercisable Voting Rights in the Entity in the hands of black people 4 30% Exercisable Voting Rights in the Entity in the hands of black women 2 10% Economic Interest in the Entity to which Black people are entitled 4 30% Economic Interest in the Entity to which Black women are entitled 2 10% Economic Interest of the following black Economic Interests natural people in the Measured Entity: - black designated groups - black participants in Employee Share Ownership Programmes; - Black people in Broad based Ownership Scheme; - black participants in Co-operatives 3 3% New Entrants 2 2% Realisation Net Value 8 TOTAL: 25 10% of the target (Year 1) 20% of the target (Year 2) 40% of the target (Year 3-4) 60% of the target (Year 5-6) 80% of the target (Year 7-8) *Subject to the condition d section 6.5 in the codes 2016/11/16 5

6 Management Control AICT Measures effective control of companies by black people Indicator Board Participation Other Executive Management Senior Management Middle Management Junior Management Management Control AITC 200 Measurement Category & Criteria Compliance Target Exercisable Voting Rights of black Board members as a percentage of all board members 3 50% Exercisable voting rights of black female board members as a percentage of all board members 2 25% Black Executive directors as a percentage of all executive directors 2 50% Executive Black female Executive directors as a percentage of all executive directors 1 25% Black other Executive Management as a percentage of all executive directors 3 60% Black female other Executive Management as a percentage of all executive directors 2 30% Black employees in Senior Management as a percentage of all senior management 2 60% Black female employees in Senior Management as a percentage of all senior management 1 30% Black employees in Middle Management as a percentage of all middle management 2 75% Black female employees in Middle Management as a percentage of all middle management 1 38% Black employees in Junior Management as a percentage of all junior management 1 88% Black female employees in Junior Management as a percentage of all junior management 1 44% Employees with Black employees with disabilities as a percentage of 2 2% disabilities all employees TOTAL: /11/16 6

7 Skills Development AITC Bonus Measures the extent to which employers develop the competencies of black employees Indicator Skills Development on any programme specified in the Learning Programme Matrix for black people as a percentage of the Leviable Learnership, Apprenticeships, and Internship Bonus points TOTAL: Skills Development AITC 300 Measurement Category & Criteria Skills Development Expenditure on Learning Programmes specified in the Learning Programme Matrix for black people as a percentage of Leviable amount Skills Development Expenditure on Learning Programmes specified in the Learning Programme Matrix for black employees with disabilities as a percentage of Leviable Amount Number of black people participating in Learnership, Apprenticeships, and Internships as a percentage of total employees Number of black unemployed people participating in training specified in the learning programme matrix as a percentage of number of employees Number of black people absorbed by the Measured and Industry Entity at the end of the Learnership programme Compliance Target 8 6% 4 0.3% 4 2.5% 4 2.5% 5 100% Bonus 2016/11/16 7

8 Enterprise and Supplier Development AITC Bonus Measures the extent to which companies carry out initiatives contributing to enterprise development Indicator Preferential Procurement Bonus Supplier Development Enterprise Development Bonus TOTAL: Enterprise and Supplier Development AITC 400 Measurement Category & Criteria B-BBEE Procurement Spend from all Empowering Suppliers based on the B-BBEE Procurement Recognition Levels as a percentage of Measured Procurement Spend B-BBEE Procurement Spend from all Empowering Suppliers that are Qualifying Small Enterprises based on the applicable B-BBEE Procurement Recognition Levels as a percentage of Measured Procurement Spend B-BBEE Procurement Spend from all Exempted Micro-Enterprises based on the applicable BBBEE Procurement Recognition Levels as a percentage of Measured Procurement Spend B-BBEE Procurement Spend from Empowering Suppliers that are at least 51% black owned based on the applicable B-BBEE Procurement Recognition Levels as a percentage of Measured Procurement Spend B-BBEE Procurement Spend from Empowering Suppliers that are at least 30% black women owned based on the applicable B-BBEE Procurement Recognition Levels as a percentage of Measured Procurement Spend B-BBEE Procurement Spend from Designated Group Suppliers that are at least 51% Black owned Annual value of all Supplier Development Contribution made by the Measured Entity as a percentage of the target Annual value of Enterprise Development Contribution and Sector Specific Programmes made by the Measured Entity as a percentage of the target. Black owned ICT Entities Bonus point for graduation of one or more Enterprise Development beneficiaries to graduate to the Supplier Development level Bonus point for creating new jobs up to 10% of the workforce directly as a result of Supplier Development and Enterprise Development initiatives by the measured entity; or Bonus point for creating new jobs up to 11% of the workforce directly as a result of Supplier Development and Enterprise Development initiatives by the measured entity Compliance Target 5 80% 3 15% 4 15% 9 40% 4 12% 2 2% 10 2% of NPAT 15 3% of NPAT Bonus 2016/11/16 8

9 Specialised Scorecard: Enterprise and Supplier Development AITC Bonus Measures the extent to which companies carry out initiatives contributing to enterprise development Specialised Scorecard: Enterprise and Supplier Development AITC 400 Indicator Measurement Category & Criteria Compliance Target B-BBEE Procurement Spend from all Empowering Suppliers based on the B-BBEE Procurement Recognition Levels as a 5 80% percentage of Measured Procurement Spend B-BBEE Procurement Spend from all Empowering Suppliers that are Qualifying Small Enterprises based on the applicable B-BBEE Procurement Recognition Levels as a 4 15% percentage of Measured Procurement Spend Preferential Procurement Bonus Supplier Development Enterprise Development B-BBEE Procurement Spend from all Exempted Micro-Enterprises based on the applicable BBBEE Procurement Recognition Levels as a percentage of Measured Procurement Spend B-BBEE Procurement Spend from Empowering Suppliers that are at least 51% black owned based on the applicable B-BBEE Procurement Recognition Levels as a percentage of Measured Procurement Spend B-BBEE Procurement Spend from Empowering Suppliers that are at least 30% black women owned based on the applicable B-BBEE Procurement Recognition Levels as a percentage of Measured Procurement Spend B-BBEE Procurement Spend from Designated Group Suppliers that are at least 51% Black owned Annual value of all Supplier Development Contribution made by the Measured Entity as a percentage of the target Annual value of Enterprise Development Contribution and Sector Specific Programmes made by the Measured Entity as a percentage of the target. Black owned ICT Entities 5 15% 11 40% 5 12% 2 2% % of NPAT or 0.2% Annual Revenue/Allocated Budget/Gross Receipts/Discretion al Spend 3% of NPAT or 0.3% Annual Revenue/Allocated Budget/Gross Receipts/Discretion al Spend Bonus point for graduation of one or more Enterprise Development beneficiaries to 1 graduate to the Supplier Development level Bonus Bonus point for creating one or more jobs directly as a result of Supplier Development 1 and Enterprise Development initiatives by the Measured Entity. TOTAL: Bonus 2016/11/16 9

10 Socio-Economic Development AITC 500 Measurement Category & Criteria Socio-Economic Development AITC 500 Compliance Target 12 Measures the extent to which companies support socioeconomic development Annual value of all Socio-Economic Development Contributions by the measured Entity as a percentage of the target % of NPAT TOTAL: /11/16 10

11 Notes: Notes: 2016/11/16 11

12 Premier Verification (Pty) Ltd 5 Second Road, Fountain Grove Office Park, Block 1, 1st Floor For more information, please contact: info@p-v.co.za