BEE codes could be forced on firms
2 February 2007

Black Economic Empowerment legislation could be amended to compel companies to adhere to codes of good practice, Parliament's trade and industry portfolio committee heard on Wednesday.

"The act does not empower us to take action against a company that refuses to recognise the codes, that is why we are currently considering reviewing the act to give it more teeth," " Dti chief director Polo Hadebe told the committee.

At the moment, only companies doing business with the government could be punished for non-compliance with the codes.   "If a company applies for a government tender and it is found that it does not comply with the codes, its application is turned down," said Hadebe.   She said the department was working with other government departments to ensure the codes were enforced.

"For example, if a company manufacturing paper needs a licence for forestry development, the forestry department would refuse to grant it on the basis that it was not BEE compliant," she said.   The codes, which were approved by cabinet last year, set out seven elements to measure the extent of companies' compliance with the country's BEE policy, including management control, social economic development and skills development.

Among other things, they demonstrate the extent to which a company's ownership structure advances the country's transformation objectives, and rate companies on their contribution to the development of the second economy.

Sapa, www.business.iafrica.com