Vendzulu Development Agency Awarded Top Broad Based Procurement Recognition Level
Vendzulu Development Agency Awarded Top Broad Based Procurement Recognition Level
BEE Empowered, a well renowned SANAS-accredited BEE Rating Agency, has recently awarded a Level One BEE rating to Vendzulu Development Agency after a full verification of the organisation’s black empowerment status. To receive this top procurement recognition level, Vendzulu Development Agency had to provide authentic proof of documents and information that illustrates the company’s standing and commitment towards black empowerment in the various areas of business. Following a stringent audit, Vendzulu Development Agency finally received a B-BBEE Score of 100 (100% Black-Owned/135% B-BBEE Recognition Level).
The Role of Black Economic Empowerment or BEE in Procurement
Broad-based black economic empowerment forms part of the South African Government’s economic strategy, which serves to eliminate any restrictions that could exist within procurement processes for black individuals to participate fairly in the economy. To support this strategy, the Broad-Based Black Economic Empowerment Act, was constituted in 2003. Implementation of this legislation occurs in terms of the Codes of Good Practice on Broad-Based Black Economic Empowerment. The Codes were promulgated in February 2007 as regulations to the Act.
The primary objectives of making black empowerment part of government procurement policies, are to guarantee the following:
- Direct black empowerment through ownership and control of enterprises and assets;
- Human resource development through skills development and employment equity;
- Indirect black empowerment through preferential procurement policies aimed at ensuring that black people benefit from government and private sector procurement as well as through development of black owned and controlled enterprises.
How Is A BEE Rating Calculated?
To determine an organisation’s BEE rating, a “scorecard” system is applied, which has been established by the Codes of Good Practice. According to this scorecard system, companies are evaluated and points are awarded for a number of black empowerment criteria. This includes the share of equity held by black persons and black women; the extent to which black persons and black women have management control over the entity; employment equity; skills development; preferential procurement; enterprise development as well as socio-economic development.
Once the points are calculated, a BEE Contribution Level is determined. The more points a company earned for each of the highlighted elements, the higher the BEE rating will be. This will then finally determine the BEE Contribution Level, which can be summarised as follows:
Level One Contributor 100 points on the Scorecard 135%
Level Two Contributor 85-100 points 125%
Level Three Contributor 75-85 points 110%
Level Four Contributor 65-75 points 100%
Level Five Contributor 55-65 points 80%
Level Six Contributor 45-55 points 60%
Level Seven Contributor 40-45 points 50%
Level Eight Contributor 30-40 points 10%
Non Compliant Contributor less than 30 points 0%
BEE and Government Procurement
In support of black empowerment as part of the national economic transformation strategy, BEE principles are enforced by the procurement policies and procedures of Government Departments and all state owned enterprises. Any company that wants to do business with a government entity, therefore has to be BEE compliant.