• Road to riches

    Taxpayers keep funding structures with big plans but who knows what efficacy, says Mandi Smallhorne.

  • Don't fall for Ponzi scams

    An expert unpacks the tell-tale signs to watch out for.

  • Inside Labour

    A smokescreen of misleading rhetoric won't make SA's problems go away, says Terry Bell.

Loading...
See More

Retail sector 'needs BEE charter'

Jul 12 2012 11:11

Related Articles

Peters adamant over fuels charter

Davies: No confusion over B-BBEE bill

Mine charter review may be on cards

Banks may ditch financial charter

Minister slams fuel industry BEE levels

Davies warns of stricter BEE codes

 

Johannesburg - Empowerment experts have called for government to introduce a broad-based black economic empowerment charter to ensure retailers remain fully compliant with BEE codes of practice, according to Business Report.

Despite BEE programmes by retail giants such as Pick n Pay Stores [JSE:PIK], Massmart Holdings [JSE:MSM], Woolworths Holdings [JSE:WHL] and Clicks Group [JSE:CLS], there has been widespread criticism that the sector is not fully compliant with BEE standards.

The government had little or no leverage on broad-based BEE in the retail sector, Ajay Lalu, the managing director of Black Lite Consulting told Business Report.

Lalu criticised the sector's enterprise development programmes and employee share schemes, saying some of them were used to sugar-coat empowerment programmes as they did not fundamentally transform the supply chain.

He said deals such as the Massmart and Walmart merger would not have been opposed by the government if Massmart had good empowerment programmes or better employee relations. “In my view the merger would have received support from (the) government had Massmart been more proactive on its empowerment programme,” Lalu said.

The retail sector, unlike other industries, does not have a transformation charter with set targets to be achieved by particular dates.

Instead of full partnerships with black-owned businesses, retailers have put in place a number of enterprise development programmes and broad-based employee share ownership programmes, the report said.

Through its enterprise programme, Woolworths had appointed Stuart’s Joinery, a black family-owned company, as its preferred shop-fitting supplier for the company’s African stores and it supported BEE suppliers, the company said.

According to Pick n Pay chairperson Gareth Ackerman, its employee share trust held 3.4 million shares in the company.

“Procurement from black-certified businesses remains a priority and targets have been set for all buyers in all categories to ensure that they have an element of black procurement within their respective portfolios.”

The company had also established an enterprise development foundation and a franchise academy.

However, BEE analysts said this was not enough.

Lalu said retail empowerment programmes, including enterprise development, were inadequate unless retailers were prepared to establish a transformed and sustainable supply chain with real benefits flowing to black people.

Lalu stressed that more attention should be given to the manufacturing and retail sectors.

Andile Thloaele, CEO of consultancy Inforcomm, said the reason retailers lagged behind with BEE programmes was because they were not incentivised. He also added that BEE guidelines were too diluted to get the sector to fully comply.

 - Business Report

 

 
 
 

Read Fin24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
4 comments
Add your comment
Comment 0 characters remaining
 

Company Snapshot

We're talking about:

SMALL BUSINESS

Johannesburg has been selected to host the Global Entrepreneurship Congress in 2017. "[The congress] will ensure that small business development remains firmly on the national agenda and the radar screen of all stakeholders, the Small Business Development minister said.
 

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...

Voting Booth

People who fall victim to Ponzi scams are:

Previous results · Suggest a vote

Loading...