Firms to shed up to 50% for BEE

GOVERNMENT wants to broaden company ownership for previously disadvantaged Namibians to at least 25 per cent by 2018, of which ten per cent should go to women and youth, it was revealed yesterday.

White women can obtain a maximum of 30 per cent ownership and management control. Six months after the start of consultations for a Namibian Black Economic Empowerment (BEE) policy, a workshop was held yesterday for some 40 businesspeople and Government officials to scrutinise a mid-term progress report on the drafting of the framework.For the first time details about levels of equity, a scoring system and a time frame to complete the process by 2018 were heard.The final policy document will be completed by April next year, with implementation to start the same year.”The Transformation of Economic and Social Empowerment Framework (Tesef) as the policy will be called in Namibia, targets at least 25,1 per cent company ownership but aims at a majority control of up to 51 per cent eventually,” said Malverene Rittman, the consultant.Rittman is part of Decti Namibia, a subsidiary of the South African mining consultancy and empowerment rating agency Decti.The one-year consultancy contract is worth N$1,9 million.Other targets set are that white women should get 30 per cent management control in companies and that foreign investors wanting to set up business in Namibia must provide equity to previously disadvantaged Namibians and the same must be done by existing multi-national companies operating in Namibia.This could prevent new investors from coming to Namibia, veteran business tycoon Harold Pupkewitz warned.”It might scare away foreign investors, they often spend millions of dollars on mining and exploration.Don’t make selling off equity a condition,” he urged.Similar to the Financial Services Charter, which was compiled by the finance industry in Namibia, the draft will require companies to provide funding mechanisms to previously disadvantaged people to enable them to buy shares.They must also set aside between two and three per cent of the total payroll spending on managers for investment in staff training.Once the policy is in place, all companies will have to increase their procurement volumes of goods from enterprises belonging to or co-owned by previously disadvantaged Namibians.Prime Minister Nahas Angula, who opened the workshop, recommended that Tesef should be worked into the third National Development Plan (NPD3), which will be finalised in a few days.Another target to be set by Tesef is that companies will have to contribute either two per cent of their net annual income or 0,2 per cent of total annual turnover to the development of communities within the periphery of their own operations.Companies will be scrutinised and given points according to a compliance scorecard based on several criteria like BEE changes towards ownership, management, affirmative action, procurement, enterprise and socio-economic development.Companies with an annual turnover of less than N$500 000 are exempted from the scorecard system.The second draft of the Tesef policy will be presented at the end of next month.Six months after the start of consultations for a Namibian Black Economic Empowerment (BEE) policy, a workshop was held yesterday for some 40 businesspeople and Government officials to scrutinise a mid-term progress report on the drafting of the framework.For the first time details about levels of equity, a scoring system and a time frame to complete the process by 2018 were heard.The final policy document will be completed by April next year, with implementation to start the same year.”The Transformation of Economic and Social Empowerment Framework (Tesef) as the policy will be called in Namibia, targets at least 25,1 per cent company ownership but aims at a majority control of up to 51 per cent eventually,” said Malverene Rittman, the consultant.Rittman is part of Decti Namibia, a subsidiary of the South African mining consultancy and empowerment rating agency Decti.The one-year consultancy contract is worth N$1,9 million.Other targets set are that white women should get 30 per cent management control in companies and that foreign investors wanting to set up business in Namibia must provide equity to previously disadvantaged Namibians and the same must be done by existing multi-national companies operating in Namibia.This could prevent new investors from coming to Namibia, veteran business tycoon Harold Pupkewitz warned.”It might scare away foreign investors, they often spend millions of dollars on mining and exploration.Don’t make selling off equity a condition,” he urged.Similar to the Financial Services Charter, which was compiled by the finance industry in Namibia, the draft will require companies to provide funding mechanisms to previously disadvantaged people to enable them to buy shares.They must also set aside between two and three per cent of the total payroll spending on managers for investment in staff training.Once the policy is in place, all companies will have to increase their procurement volumes of goods from enterprises belonging to or co-owned by previously disadvantaged Namibians.Prime Minister Nahas Angula, who opened the workshop, recommended that Tesef should be worked into the third National Development Plan (NPD3), which will be finalised in a few days.Another target to be set by Tesef is that companies will have to contribute either two per cent of their net annual income or 0,2 per cent of total annual turnover to the development of communities within the periphery of their own operations.Companies will be scrutinised and given points according to a compliance scorecard based on several criteria like BEE changes towards ownership, management, affirmative action, procurement, enterprise and socio-economic development.Companies with an annual turnover of less than N$500 000 are exempted from the scorecard system.The second draft of the Tesef policy will be presented at the end of next month.