| How big is the impact of the Amended Codes on your scorecard and business?|
Perhaps your business was generic – between R35 and R50 million – now you will be a QSE..
Perhaps you previously achieved a level 2 using the QSE scorecard or perhaps you used the generic scorecard and achieved a level 4 – in each scenario you might believe that since you had previously done well that you will continue to do so – unfortunately that isn’t the case
The new QSE scorecard makes use of all 5 elements, whereas previously a QSE could elect to exclude elements where they had done badly. The impact of this is that it is quite easy for a QSE with 90 points on the old QSE codes, to drop to less than 40 points when using the Amended Codes. If previously you achieved a good high score as a generic, again unfortunately your score will drop. If your level 4 score was achieved without black ownership then you could now become non-compliant if you do not implement additional activities.
We have prepared a simple table to illustrate the impact of converting a BEE score from the old codes into the Amended Codes. The table represents averages and assumes no corrective measures have been implemented and the interpretation used was a best case scenario.
|Old Codes Score||Predicted New Codes Score|
|QSE with no Ownership – level 2 – 90 points||QSE – Between Level 6 and non-compliant|
|QSE Level 6 – 50 points – ED and SED (maximum points)|
|QSE – Non-compliant – 15 points|
|Generic (T/O between R35 to R50) – level 6 – 54 points|
|QSE – Non-compliant – about 30 points|
|Generic (10% black ownership) – level 4 – 74 points|
|Generic – Level 8/7 – maximum of 70 points.|
|Generic (25% black ownership) – Level 2 – 95 points|
|Generic – Level 4/3|
The impact of the Amended Codes will be widely felt amongst companies – however customers will not be so forgiving to their suppliers. They are still asking for and fully expecting to receive level 4 or better scorecards from their suppliers because they do not want to drop points on their own scorecard. Our last newsletter discussed how suppliers are being changed to meet BEE targets.
The good news is that you still have time – however not very much since activities need to be implemented before your next financial year end which for many is February 2016.
Solutions – EconoBEE is a BEE Consultancy who is able to assist businesses pro-actively implement BEE activities to ensure they achieve a good BEE scorecard. Our consulting service – Managed Service – is tailored towards assisting our clients on an on-going basis manage all aspects of BEE. Alternatively for smaller businesses who don’t need a consultant we have regular halfday workshops and user friendly scorecard calculators to assist them manage BEE properly.
While there is demand for a BBBEE Scorecard someone will be taking advantage, shouldn’t that someone be you…