Sustainable Development = Sustainable Business – EconoBEE Newsletter 8 September 2009

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EconoBEE - BEE Points = Business

EconoBEE Newsletter – September 2009

08 September 2009

Sustainable Development for Businesses

Sustainable Development in a business context is ensuring the long term sustainability of that business and the general environment it operates in. This includes the economic, environmental, customer, supplier, social and labour environments.

It makes sense to run your business in a way that it thrives and is sustainable for the long-term.

It is quite easy to measure financial performance – your accounts tell the whole story. It is far more difficult to measure sustainable development: You would need to look at many other areas that affect your business, the risk that each carries.

The easiest way to understand this is by using extreme examples:

  • An oil company that does not do exploration, or find others sources of supply will soon run out of oil – the only product that it sells
  • A supermarket that is not concerned about the quality and freshness of the products it sells will run out of customers
  • A manufacturing or engineering or mining company that does not measure its safety record will find its licenses revoked, and its customers will choose an alternative company that is more concerned about those issues
  • Perhaps a less extreme but more practical example, a bus or taxi that allows their tire tread to run bare or does not obey road rules will have safety, customer and ultimately government concerns. Eventually an alternative will actively be searched for, found and supported

On the other hand a small business like ours has different issues to worry about: Can we save money by using less electricity or sending documents electronically rather than printing them out? Can we save fuel by visiting our client less often? Will we lose business if we do not visit clients?

Big business needs to look at other and more relevant indicators of sustainable development:

The GRI (Global Reporting Initiative) provides guidelines on measuring and reporting on sustainability. It covers diverse areas such as:

  • Economic: Financial Performance, Risk, market presence, suppliers etc
  • Environment: Materials, Energy, Water, Biodiversity, Emissions, effluents and waste etc
  • Human Rights: Investment and procurement practices, non-discrimination, freedom of association and collective bargaining, child labour, security practices etc
  • Labour practices and decent work: Employment, labour/management relations, Occupational health and safety etc
  • Product responsibility: Customer health and safety, product and service labeling, marketing communications, customer privacy, compliance
  • Society: Community, corruption, public policy, anti-competitive behaviour and compliance

In all the above cases it is necessary to identify the relevant indicators that will measure those aspects that most affect the business, as some indicators are not relevant to your particular business. The above topics could translate into hundreds on specific indicators: e.g How much waste does the company generate – paper, plastic, glass, toxic, other?

Gathering the data, measuring and reporting: It sounds easy to get details of some of these indicators. However this is not necessarily the case. Take water or electricity usage as an example. In reality there could be multiple people, at various sites and branches based at different municipalities who will be responsible for gathering the data.

Introducing – Practical Sustainable Development and Reporting Conference – EconoBEE and Kulima Solutions. We will cover not only the key concepts of sustainable development, but also help you identify practical steps for developing and implementing a strategy for sustainability. We will cover the data gathering process and give tips on how best to manage it.

Finally we will discuss how to present the findings in a comprehensive Sustainable Development report, with proper measurables.


Introducing – Practical Sustainable Development and Reporting Conference

Introducing the first EconoBEE Practical Sustainability, Reporting and Business Conference, presented in conjunction with Kulima Solutions, which will highlight the opportunities for your business to embrace the goals of sustainability. This introductory course will include an overview of the key concepts of sustainability.

Sustainable Development and reporting on sustainable development is becoming more and more important to businesses.

The aim of any business is to generate sustainable profits. The goal of sustainability is to achieve this while also minimising adverse impacts on society and the environment. Corporate Social Responsibility initiatives form part of a larger strategy of sustainability.

The key outcome of the course will be a roadmap for developing strategies and implementation plans for sustainability within your business.

This conference will help you identify opportunities for your business by making Business Sense out of Sustainable Development.

Key areas such as the Global Reporting Initiative (GRI), AA1000, the JSE Socially Responsible Investment Index and (SRI) will be covered in a practical manner.

The key speakers and presenters are Katharine Vincent (PhD) and Tracy Cull BA SocSci (Hons) who have extensive experience in sustainable development and corporate social responsibility, both in a practical environment and academically. Keith Levenstein, CEO of EconoBEE, who is currently responsible for designing a system to measure the effectiveness of sustainable development activities in businesses.

The two day conference will be presented at Gallagher Estate in Midrand, at Makaranga Garden Lodge in Durban and Belmont Conference Centre in Cape Town.

Practical Sustainable Development and Reporting Conference
Dates and Venues:28th & 29th October 2009 – JHB – Gallagher Estate
4th & 5th November 2009 – CPT – Belmont Conference Centre
11th & 12th November 2009 – DBN – Makaranga Garden Lodge
Cost:R6450.00 incl VAT
Booking:Contact 0861 11 3094 or info@econobee.co.za or visit www.econobee.co.za and fill in the online form or get the brochure.

Not sure if this is right for your business, why not give us a call (0861 11 3094) or send us a mail (info@econobee.co.za) and we will give you all the advice you need to ensure you make the right decision.


Copenhagen – what it’s all about?

If you have visited the website of any environmental organisation recently, or been accosted by someone in a shopping mall encouraging you to join Greenpeace, or read the environment pages of the Mail and Guardian, it is very likely that you will have seen reference to the Copenhagen conference, a pivotal negotiation on climate change due to take place in December 2009.

South Africa, and most countries around the world (including the United States) signed the United Nations Framework Convention on Climate Change at the Rio Earth Summit in 1992.  This framework agreement commits signatories to preventing “dangerous” human interference with the climate system, but has no binding commitments, which come in the form of protocols. So far only one exists – the Kyoto Protocol, named after the city in Japan where it was signed in 1997. The Kyoto Protocol commits developed countries to reduce their greenhouse gas emissions by 8-12% on 1990 levels by 2008-2012 (known as the first commitment period), but contains no commitments for developing countries, including China (which recently overtook the US in terms of share of global emissions).  This was the reason cited for the withdrawal of the US from this protocol in 2001.

As the first commitment period draws to a close, negotiations are underway for a successor to the Kyoto Protocol – which will be finalised in Copenhagen. Current indications suggest a similar “cap and trade” arrangement, whereby countries have a target which they can reach through mechanisms including carbon trading – but that the big 5 developing country emitters – Brazil, China, India, Mexico and South Africa – will have a reduction commitment for the first time.

As the 17th largest emitter of greenhouse gas emissions in the world, South Africa unilaterally signalled its commitment to reducing carbon emissions with the launch of the Long Term Mitigation Scenarios in 2008, which describe four strategic options for reducing carbon emissions over the period to 2050, and form the basis for discussion of national climate policy, as well as inputs to the South Africa negotiators at Copenhagen.

If you want to find out more about climate change and your business, please contact the team at Kulima Solutions. Kulima Solutions is a specialist Sustainable Development and Corporate Social Responsibility Consultancy whose principals are:

Katharine Vincent, BA Hons. (Oxford), MREs (University of East Anglia), PhD (University of East Anglia) Email: katharine.vincent@gmail.com, Phone: 072 1964525.

Tracy Cull, B. Soc. Sci. Hons (University of Natal, Durban) Email: tracymcull@gmail.com, Phone: 082 820 660


How does one interpret a BEE scorecard – Inconsistencies?

Over the past weeks we have come across hundreds of BEE scorecards, certificates and letters.

Some originate from the companies themselves, some from consultants and some from verification agencies.

Unfortunately there is no consistency in these documents, strangely enough this was an article we wrote over a year ago. Each company uses their own “look and feel”, which is perfectly acceptable, but the information contained in each certificate or scorecard differs widely.

Many companies have also supplied us with letters confirming that they are in the process of obtaining a rating. Many of these letters have expiry dates on them which is completely senseless.

Why ask for a scorecard?

The purpose of obtaining a scorecard from your supplier is to assist you in calculating points for Preferential Procurement. Up to 20 points are available (25 for QSE’s) for this element. You only need a scorecard from suppliers, not customers!

To do your calculation to earn and maximise points you need to know the following information about your supplier.

  1. Annual spend with that supplier
  2. The size of the company (EME/QSE/Generic)
  3. Their BEE level (1-8 or non-compliant)
    • Broken down into the Elements where they earned the points
  4. If they are a value adding supplier
  5. The percentage of black ownership in the business
  6. The percentage of black female ownership in the business
  7. If they are, or potentially could be, your enterprise development project
  8. The rating period/expiry date of the rating
  9. Do they have suitable proof for every item on the scorecard
  10. Has the scorecard been signed by an authorised individual

In addition, many companies trade under different trade names, or are part of a group. It does become quite difficult to know exactly which scorecard applies to your own supplier.

We suggest you capture your suppliers and their scores by references to both to their company registration number and VAT number. All invoices from your supplier must carry a registration number and VAT number if they are VAT registered. (If they are not VAT registered, they are probably EME’s and therefore level 4 or level 3).

All the other information on the documents/certificates you may receive is irrelevant!

Managing the preferential procurement element is certainly an admin task, but it need not be too difficult if you follow our tips and simple rules. There is no direct cost, other than searching for appropriate suppliers and getting the right information from existing suppliers. It is either 20% or 25% of your whole scorecard so cannot be ignored.

More about BEE Procurement.


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

Not sure how to get a BEE Scorecard, click here to see a demonstration of how best to produce your own BEE scorecard.

In this issue

  • Sustainable Development for Businesses
  • Copenhagen – what it’s all about?
  • Introducing – Practical Sustainable Development and Reporting Conference
  • How does one interpret a BEE scorecard – Inconsistencies?


In other news

About EconoBEE

EconoBEE is a BEE consultancy who has developed extremely effective tools to measure and implement Broad Based Black Economic Empowerment. Our services focus on the business side of BEE.  Our services include EconoBEE Scorecard, BEE Scorecard Workshops, EME Pack, Document Pack, EconoLog and the 10 Step Process to BEE Compliance.

Our company supports various organisations and drives the BEE Expert Group 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: 0861 11 3094 or 011 483 1190
Fax: 011 483 1195
Email: info@econobee.co.za
Web: www.econobee.co.za


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Remember
BEE Points = Business


That’s it for the time being.
Regards
Keith and the EconoBEE Team

Executive summary of B-BBEE

Turnover below R5 million per annum – automatic BEE status

Turnover above R5 million per annum – BBBEE Scorecard Compliance

EconoBEE – Knowledge Transfer

BEE Procurement and Enterprise Development Conference – 1 Oct JHB, 8 Oct CPT and 15 Oct DBN

Practical Sustainable Development Conference

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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