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
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
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
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
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