Black Economic Empowerment - Scorecards

Scorecards

Enterprises may be rated based on various scorecards, however only the following have been gazetted as of February 2007:

  • Generic Broad Based Scorecard
  • Generic Narrow Based Scorecard
  • Qualifying Small Enterprises Narrow Based Scorecard
  • Qualifying Small Enterprises Broad Based Scorecard
  • Financial Sector Scorecard
  • Construction Sector Scorecard

The last two - Financial Sector scorecard and Construction Sector scorecard have not been passed into law. They were gazetted under section 12 of the act, which is for comment only. They will need to be gazetted in terms of section 9 of the act to become an official sector code. Until that happens all enterprises falling in these two industries are required to use the codes of good practice in producing a scorecard.

Significant leniency for Small Enterprises has been built into the gazetted codes. Based on the Qualifying Small Enterprises Codes, all companies with a turnover under R5 million p.a. is completely exempt from BEE and automatically qualifies as a level 4 contributor or achieves 100% BEE Contribution Recognition.

The generic broad based scorecard. All seven pillars must be addressed totalling 100 points

Element Weighting Compliance Targets
Ownership 20 points 25%+1
Management Control 10 points (40% to 50%)
Employment Equity 15 points (43% to 80%)
Skills Development 15 points 3% of payroll
Preferential Procurement 20 points 70%
Enterprise Development 15 points 3% (NPAT)
Socio- Economic Development 5 points 1% (NPAT)

Qualifying Small Enterprises (those with an annual turnover from R5 - 35 million) are rated on the following scorecard and may choose any four of the pillars to address, totalling 100 points

Element Weighting Compliance Targets
Ownership 25 points 25%+1
Management 25 points 50.1%
Employment Equity 25 points (40% to 70%)
Skills Development 25 points 2% of payroll
Preferential Procurement 25 points 50%
Enterprise Development 25 points 2% (NPAT)
Socio- Economic Development 25 points 1% (NPAT)

Ictiandro Simba

Read more about this topic:  Black Economic Empowerment

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