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Managing your BEE status to ensure long term success – EconoBEE Newsletter – 28 January 2014

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Dear [Name]

Managing your BEE status to ensure long term sustainable success with BEE.

The Problem!
BEE Implementation requires input from different people with different skills in order to be successful. Managing incoming data, ensuring it is correct and then having it verified correctly can be the difference between a good score and just missing the level you require.

The Solution:
The B-BBEE implementation process can be simplified dramatically.
A good score is a result of implementing transactions within a company and then identifying those transactions as earning BEE points. This simplistic approach only needs staff capacity to gather appropriate data and then analyse it.

Our approach:
Building on the simplified solution, we need to identify sources where data is going to be generated and build a management structure around those sources.

Phase 1
Executive commitment. Assist the directors in understanding B-BBEE. Discuss targets/level required, as well as the resultant cost to implement the transactions to reach that level.

Although the directors are not going to specifically implement any BEE activity they will decide on the direction the company needs to take with respect to implementing BEE activities. It is maybe more fair to suggest that the executives decide on a direction with respect to an element with a consequence of earning BEE points.

Phase 2
1. Assign a key person to be responsible for the final BEE scorecard and the collation of data.
2. Create a BEE committee where key stakeholders related to each of the 7 elements are all members.
3. Each stakeholder is responsible for the implementation of their respective element.

Phase 3
Implementation. Stakeholders for elements need to begin implementing activities based on the executives requirements.
For example, if the executives decide to invest more in Skills Development, then the element head will devise a skills strategy that best fits in with the objectives of the company. We will work with that person to best take advantage of the BEE points available.

A monitoring mechanism should be in place. The reporting system is covered in phase 4.

Phase 4
Identifying and interpreting transactions. Data capture structures should be implemented. In many businesses, data is generated and captured for purposes other than BEE. We work closely with the element heads to identify all types of transaction sources and then capture the transactions in a way that is BEE friendly. Once the data is captured it needs to be checked and the BEE points calculated. The preliminary scorecard is generated anytime from once a week to once a quarter depending on the time of the year in relation to the rating end period or financial year end.

In many cases the element head should not be directly seen to be implementing BEE – rather their own element which is what they are already employed for.

A successful BEE implementation is a result of finding the perfect synergies between the generation of BEE pointable transactions and reporting on them. Once that is found it creates a long term sustainable B-BBEE implementation management structure that will seamlessly work with new employees, legislative changes and growth plans of the business. The key is to measure this regularly, giving yourself enough time to implement any required activity before your rating period comes to an end.

Our Managed Service is an ideal solution for any business wanting to save time on implementing B-BBEE. Through our Managed Service we assist clients prepare a scorecard for both the current year and the future year with the view of constantly improving the number of points on the scorecard. Since our view is based on a long term view we are able to continuously keep track of progress, advise on important changes as and when the changes happen and ensure success through every single transaction.

Visit our website or contact 011 493 1190 for more information on our Managed Service.



Interesting article by Daily Maverick on fake BEE certificates

Rebecca Davis South Africa 28 Jan 2014 12:34 (South Africa) by The Daily Maverick. Extract of the article below.

…Keith Levenstein, CEO of EconoBEE, says he has seen some pretty audacious attempts at BEE certificate fraud. “We have seen a certificate that awarded eight points for socio-economic development – when there are only five available. It’s like forging a $12 bill,” Levenstein told the Daily Maverick. “On confronting the company they expressed ignorance and admitted that they were approached by someone at the DTI’s offices and paid R2000 for the certificate at the local Wimpy.”

Another company, Levenstein says, pretended that their turnover was less than R5 million, rendering them exempt from BEE compliance. “It was not difficult to discover from their website that the company employs 4,500 people, has eight branches and does R1 billion turnover.”

Levenstein says that probably 2 to 5 BEE certificates out of 100 are flawed or invalid, but many slip through the cracks. “During verification, an agency will check a small sample, and even then, if they don’t have more history regarding previous certificates, the analyst will miss an invalid certificate.” When companies do get caught, they can be charged with fraud. The B-BBEE Amendment Bill makes allowances for penalties of up to 10 years in jail and 10% of a company’s annual turnover.

Why risk it? “Mostly laziness, or a lack of knowledge of the codes,” surmises Levenstein. “Companies need a certificate and can’t be bothered to go through the process, so they take a shortcut. The most common excuses we hear when we catch the company are ‘I didn’t know’, or ‘My consultant did it’, or ‘My operations manager did it’. It’s difficult to prove that the owner knew that it was wrong.” In addition, of course, there are those companies which would rather cheat than become genuinely BEE compliant. Levenstein says that there aren’t particular industries which are worse offenders than others.

When the new BEE codes come into effect, likely next year, we may see an upturn in BEE certificate fraud because the conditions for compliance are more onerous. “Companies will take shortcuts,” predicts Levenstein. “We expect to see many companies pretending their turnover is less than R50 million and [that they are] 51% black-owned. Also, because the new codes are unclear, companies will ask for more lenient interpretations from agencies.”

Of course, BEE certificate fraud is far from a victim-less crime. “A good certificate results in more business,” Levenstein says. “In government tenders there is a direct link between BEE levels and the awarding of tenders. Quite simply, someone cheating may take business away from someone else.” Black Economic Empowerment, or an unreasonable facsimile thereof.

Read full Daily Maverick article…




Implementing the Amended B-BBEE Codes of Good Practice

The new codes will have an impact on your strategies that you need to implement.

Many people think that the new codes will be more difficult to understand and implement. We will show you that this is not necessarily the case.

  • Learn how to benefit from the new codes
  • Understand the intricacies of the codes
  • See the differences between current codes and new codes
  • Identify strategies to follow
  • Recognise how easy it will be to follow the new codes

Full Day Sessions
Half Day Sessions
20th February – JHB – Gallagher Estate
We host regular half day workshops on Tuesday mornings in our Bryanston office.
8:30 for 9:00 – 17:008:30 for 09:00 – 13:00
R2500 excl VAT (R2850 incl VAT)R1500 excl VAT (R1710 incl VAT)
Email info@econobee.co.za
Contact 011 483 1190
Book online or download our brochure.
Email info@econobee.co.za
Contact 011 483 1190

In-house presentations available on request to a minimum of 10 delegates.






Let our consultants save you time on B-BBEE.

Preferential Procurement – Save Time by using the BEE Procured database containing over 40 000 BEE Certificates. Procurement Managed Service: Our consultants can phone your suppliers for a BEE certificate – Managed Service.

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While there is demand for a B-BBEE Scorecard someone will be taking advantage, shouldn’t that someone be you…

Want us to manage your BEE Process – Managed Service.

Turnover below R10 million – find out how to get your BEE Exemption.

Is BEE procurement a pain? Sort it out quick and easy – BEE Procured.

Need a scorecard – produce one yourself – EconoBEE V3

EconoBEE Newsletter
 28 January 2014

In this issue

  • Managing your BEE status to ensure long term sustainable success with BEE
  • Interesting article by Daily Maverick on fake BEE certificates

In other news

About EconoBEE

EconoBEE is an expert BEE consultancy. EconoBEE helps businesses Become BEE Compliant, prepare for verification, earn maximum BEE Points and ensure that they achieve the BEE Level they need to get more business.

Our services include BEE Management Systems, Training, EME Pack, Complete Managed Services; consulting and advisory and Procurement Solutions.

As leaders in the industry we are driven to help maintain and develop knowledge in the BEE industry.

Already have a BEE Certificate

Please send it to us and we will include it in our BEE Procured database.

Contact Us

Tel: 011 483 1190
Fax: 011 483 1195
Email: info@econobee.co.za
Web: www.econobee.co.za

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BEE Points = Happy Customers = Sustainable Business

Gavin and the EconoBEE Team

Executive summary of B-BBEE

Turnover below R10 million per annum – automatic BEE status


Turnover above R10 million per annum – you need a BEE Scorecard. Our workshops, scorecard tools, procurement manager or a complete managed services will be best for you.


Your time on your business, our time on your BEE status


Although the Amended Codes give a 12 month transitional period the reality is that the preparation needs to begin immediately. Through our managed service prepare early and gain a competitive advantage.


10 Strategic Steps to B-BBEE!
 We have prepared an easy to follow guide “B-BBEE in 5 Minutes” and “Crash Course to BEE Verification” which explains BEE in a simple step by step approach.

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