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FRONTING – NOW A CRIMINAL OFFENCE
What constitutes B-BBEE fronting? It refers to the misrepresentation of a company’s B-BBEE status. It involves misleading the users of the B-BBEE certificate by stating that the business is more transformed than it actually is. Even though B-BBEE participation remains a voluntary process, the act of fronting has now been criminalised in the amended B-BBEE
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THE TOP 10 CHALLENGES TO B-BBEE
For most companies the effective grace period before having to implement enhanced B-BBEE initiatives has now come to an end. In the case of almost all companies their 2016/2017 financial year will be measured in terms of the amended generic or some sector specific codes. Implementation therefore has to commence as a matter of urgency.
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‘EMPOWERING SUPPLIER’ STATUS – PREREQUISITE FOR B-BBEE?
‘Empowering supplier” is a new concept introduced in the amended codes. The B-BBEE certificate will indicate this status, which will have to be independently verified before or as part of the annual verification. A customer’s spending with a supplier may only be recognised on its preferential procurement scorecard if the supplier qualifies as an empowering
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SELLING TO GOVERNMENT AND CORPORATES – HOW TO BREAK INTO THE SUPPLY CHAIN
The codes have been reduced from seven to five elements, with three – Ownership, Skills Development and Enterprise and Supplier Development – elevated to priority status. These priority elements require a sub-minimum of 40% of the targets to be achieved, failing which large entities will suffer one level discounting of its recognition level, based on
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Broad-Based Black Economic Empowerment (B-BBEE)
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