Black economic-empowerment (BEE) companies need to display a strong sense of diversity in management, support South African business, and give back to the community as good corporate citizens, says software company IBM executive for BEE Lenhle Daka.
She comments that this also holds true for transformed information, communication and technology (ICT) companies in the country.
“Traditionally, most ICT companies are highly capitalised and white-owned, and have to be innovative on how to be good corporate citizens when complying with BEE policies,” she says.
She believes that BEE compliance should not just focus on number crunching, but also on resolving equity imbalances. She adds that narrow-based BEE did not tackle major problems within the industry, and that the government’s broad-based BEE initiative has been proactive in acknowledging companies that are complying with BEE standards.
IBM is a level four contributor to BEE, which means that companies it procures can get 100% recognition in the procurement element of the BEE scorecard.
On a management level, employment equity is an important cornerstone of BEE policy. Although IBM is not able to sell its employment equity as part of BEE, Daka states that its BEE alignment is still better than some companies that have sold their equity.
IBM’s global policy states that handing over the ownership to the local workforce precludes it from selling equity to locals. However the Department of Trade and Industry (DTI) has exempted the company from selling equity.
Daka explains that the DTI cannot exempt any company from selling equity, but that a global company such as IBM which has such a policy, had to especially apply for exemption.
“Since IBM cannot sell its equity, it forces the company and its employees to develop management skills, especially in the case of black females,” she says.
In addition, Daka is confident that its equity equivalent programme, which is in the process of getting approval, will be successful. The programme will implement the company’s initiatives for employment equity, despite the fact that its ownership is excluded in its level four BEE ranking.
In the process, IBM South Africa has had to bid for the IBM Corporation to increase its investment in the country, after which the corporation invested over $120-million over the next two years into the equity programme for South and Central Africa.
The equity programme has also already created numerous job opportunities. While at the start of the project, IBM had just under 100 employees, the number has now grown to over 1 500 employees, Daka states.
She adds that IBM implements its BEE policies in the control of management, thus in day-to-day activities, as well as through skills development, employment equity, enterprise development, preferential procurement and socioeconomic development.
Daka states that IBM’s different business units are aware of the role they play in BEE, and that each individual makes a contribution towards achieving the company’s BEE goals.
IBM’s skills development programmes are focused on employees meeting short- and long-term goals, as well as on leadership development.
Daka reiterates that IBM was the first ICT company to employ black people in South Africa, and that from its inception in the country in 1952, it has prided itself in employment equity, and that the company has always recognised the diversity of employees and encouraged the acceptance of gender and cultural differences.
She points out that although IBM South Africa was started in 1952, it retracted its business in 1987 owing to apartheid, after which it sold all its shares to employees. However, in 1993, the company bought back its shares and restarted its business in the country, and its first black South African MD was appointed in 2000.
From the late 1990s, the company has been specialising in women development programmes, as well as enhancing employment opportunities for black women in the ICT sector.
“Women tend not to seek careers in the ICT sector, since it has always been a male-dominated environment. From an employment equity perspective, IBM has focused on creating awareness of these job opportunities, and has introduced incentives to attract women to the industry,” she says.
Further, Daka states that IBM has also invested in small, medium-sized and microenterprises (SMMEs), while creating lower barriers of entry for these businesses through procurement and business partner programmes.
She believes that the biggest drivers of BEE are procurement and enterprise develop- ment, and that applying procurement decisions efficiently is an imperative for any business.
IBM strives to establish relationships with SMMEs that are equally BEE compliant, while its business partner programmes develop skills and expose SMMEs to the same IBM training as its employees.