The Broad-Based Black Economic Empowerment (B-BBEE) generic score card is made up 7 elements.
The purpose of the score card is to determine your B-BBEE preferential procurement level and to give you a guideline on how to raise your current level.
The score card has a total of 100 points and once you points are calculated you will land up with a score out of 100 and that will determine your level.
The score card is made up 7 elements, each element has a certain weighting (points) attached to it.
The elements are: Ownership, Management Control, Employment Equity, Skills Development, Preferential Procurement, Enterprise Development and Social-Economic Development.
Tshuletsa can assist your company with Skills Development, Enterprise Development and Social-Economic Development.
Scorecard Element’s Table
The table below shows you an outline of what each element measures (all the financial measurements are based on annual spend)
|Ownership||This measures the effective ownership of and enterprise by black people in relation to their voting rights and economic interests within the enterprise|
|Management Control||This measures the effective control of an enterprise by black people in relation to their participation on the board and in top management positions|
|Employment Equity||This measures the intent to achieve equity in the workplace in relation to black people in Senior, Middle and Junior management as well as a percentage of black disable employees|
|Skills Development||This measures the employers initiatives designed to training develop programs to improve competencies of black employees|
|Preferential Procurement||This measures the overall procurement spent from suppliers based on B-BBEE procurement recognition levels including, Qualifying Small Enterprise (QSE’s), Exempt Micro Enterprise (EME’s) and suppliers that have a percentage of black owned or black woman owned|
|Enterprise Development||This measures the enterprises spend on initiates intended to assist and accelerate the development and sustainability of other enterprises that are qualifying beneficiary entities|
|Social-Economic Development||This measure the enterprises spend on initiatives that contribute towards Socio-Economic Development (SED) or sector specific initiative and promote access to the economy for black people|
In terms of the Codes of Good Practice on Broad-Based Black Economic Empowerment, the compliance requirements for B-BBEE varies according to the size of your entity, as measured by your annual turnover.
Exempt Micro-Enterprise: Turnover of R 5 million per annum and below
This means that you are classified as an Exempt Micro-Enterprise (EME), you are classified as a Level 4 Contributor to B-BBEE, that means your clients can claim at least 100% of their procurement spend with your company which then counts towards their own B-BBEE scorecard. You could also be classified as a level 3 Contributor if more than 50% owned by black people. You can be measured in terms of the Qualifying Small Enterprise (QSE) score card if you want to move to the next procurement recognition level.
Qualifying Small Enterprise: Turnover of R 5 million per annum to R 35 million
This means that you are classified as a Qualifying Small Enterprise (QSE). Although the scorecard consists of seven sections, you are only measured on the best four or the four you choose to be measured on.
Enterprise (Generic scorecard): Turnover of R 35 million per annum and above
This means that you need to comply with the Generic scorecard, which consists of all seven elements.
Scorecard Element’s Weighting Table
The table below shows you the weighting of each element in relation to the Generic scorecard
|Management Control||10 points|
|Employment Equity||15 points|
|Skills Development||15 points|
|Preferential Procurement||20 points|
|Enterprise Development||15 points|
|Social-Economic Development||5 points|
Scorecard Recognition Levels Table
The table below shows you the different recognition levels.
|BEE Status||BEE Score||Recognition Level|
|Level 1 Contributor||100 +||135%|
|Level 2 Contributor||85 – <100||125%|
|Level 3 Contributor||75 – <85||110%|
|Level 4 Contributor||65 – <75||100%|
|Level 5 Contributor||55 – <65||80%|
|Level 6 Contributor||45 – <55||60%|
|Level 7 Contributor||40 – <45||50%|
|Level 8 Contributor||30 – <40||10%|
|Non-compliant Contributor||< 30||0|
So the higher your level is and the level of the supplier you are dealing with the more benefit you both receive. If you spend R 1000 with a supplier who is a level 3 contributor you can then claim 110% of what you actually spent for your scorecard, so you would count R 1100.
Where an enterprise is in 50% excess owned by black people, the BEE Status of that Enterprise will be at the level immediately above the level at which its score is actually evaluated.