Nelson Sebati: Meeting with Gauteng Premier, David Makhura & MEC Barbara Creecy discussing the Tshepo 1 million jobs initiative....

Gauteng Premier David Makhura, MEC Barbara Creecy, Chief Empowerment Advisor, Nelson Sebati.

Chief Empowerment Officer, Nelson Sebati

Cognac & Conversation with Nelson Sebati: Understanding The Mandate Of The B-BBEE Commission

Cognac & Conversation with Nelson Sebati: Understanding The Mandate Of The B-BBEE Commission

Chief Empowerment Officer, Nelson Sebati

www.enterprisesupplierdevelopment.co.za recently met up with Chief Empowerment Advisor, Nelson Sebati at his favorite after-work chill-spot for some "cognac and conversation" on the mandate of the B-BBEE Commission. Listed below is some of the information that he shared....

Due to ‘rife fronting’, the establishment of a B-BBEE commission was announced in October 2015 by the Minister of Trade and Industry. The commission, which began its operations in April this year, has a mandate to investigate and deal with fronting, fraud, and other B-BBEE transgressions.

The original BEE codes were implemented as far back as 2007 to reduce inequality, promote the growth of the black middle class, and reduce unemployment. However, in addition to a lack of meaningful transformation, there’s the issue of fronting which, according to the DTI, is ‘a deliberate circumvention or attempted circumvention of the B-BBEE Act and the Codes’. Until recently there was no established institution to monitor, oversee, and regulate the empowerment laws, which resulted in:

• Business owners employing black individuals and misrepresenting them as directors, shareholders, or management; 
• Organizations with B-BBEE ratings falsely claiming to have a high percentage of black ownership;
• Companies appointing black directors and shareholders and preventing them from having signing powers, access to financial records, or active participation in the company 
• Black employees appointed to management roles being paid considerably less than, or not having similar responsibilities, compared to white employees in the same role; 
• BEE-rated companies who won government tenders sub-contracting the work to non-compliant entities; 
• The economic benefits received as a result of an entity’s B-BBEE Status did not flow to black people, as per relevant legal documentation. 

Incidences such as these have slowed the process of transformation and creating a dire need for an independent BEE commission to properly regulate industry.

Along with policing, fronting and fraud, the commission assess B-BBEE transactions and ensures that these contribute towards the long-term goals of the National Development Plan.  Functioning as a state organ within public administration, but outside the public service, it is headed by a commissioner who is responsible for all functions and administration. As per the Broad-Based Black Empowerment Act, the commission works with other organs of state such as the Special Investigating Unit (SIU), the South African Revenue Services (SARS), the Independent Regulatory Board of Auditors (IRBA), the National Prosecuting Authority (NPA), and the South African Police Services (SAPS). The commission also supervises B-BBEE rules and maintains a record of major BEE transactions.

As it is a criminal act to knowingly engage in BEE fronting practices, business owners found to have engaged in BEE fronting can be prosecuted. Penalties are up to ten years imprisonment, and a hefty fine of ten percent of turnover, or both. Another consequence – the company may be disqualified from doing any business with state organs or public entities for a period of ten years. These penalties may seem harsh, but government is serious about resolving transgressions and preventing them from occurring in the future.

For more information visit: https://bbbeecommission.co.za/

Entrepreneur Speakers Corner: MASTER CLASS.....Nelson Sebati & Others.

Ministerial briefing with Deputy Minister in the Presidency, Hon. Buti Manamela MP........

The Progressive Business Forum (PBF) hosted a ministerial briefing with Deputy Minister in the Presidency, Hon. Buti Manamela MP at the Sunnyside Park Hotel in Parktown, Johannesburg, on Thursday 23 April 2015. Also present was the Chairperson of the Economic Development Portfolio Committee of the Johannesburg Metropolitan Council, Cllr Willie van der Schyff and Professional Empowerment Advisor, Nelson Sebati. More than 200 business-people attended the event.....http://pbf.org.za/show.php?id=8333

What Is Supplier Diversity And Why Is It Important?

What is Supplier Diversity: A Profitable Strategy?

Supplier Diversity is a business strategy that ensures a diverse supplier base in the procurement of goods and services for any business or organization. Supplier Diversity emphasizes the creation of a diverse supply chain that ensures the inclusion of diverse groups in the procurement plans for government, not-for-profits, and private industry. Statistics show that companies who embrace diversity are more profitable than companies who don’t.

“The reason diversity works is that on almost every measure, greater racially, ethnically, and culturally diverse workplace teams function more effectively than more homogenous teams.  Members from diverse backgrounds, experiences, and perspectives avoid “groupthink,” whereas non-diverse teams get mired in it. …In short, the business case for diversity is overwhelming.”

What is a Diverse Supplier?

There are approximately sixteen categories used to identify diverse businesses. Common examples include Small Micro or Medium Enterprises (SMME), Black owned enterprises (BO), Black-Women Owned Enterprise (BW0) and Designated Groups Owned Enterprise (DGO). In order to report diverse spend; it is important to ensure suppliers are certified.

Diversity Certification is an important milestone in the life of a supplier because it authenticates that the business is owned, managed, and controlled by a qualifying diverse group. Organizations such as BBBEE verification agencies focus on assuring that businesses are appropriately categorized by offering third-party certification services on behalf of private industry. State and local governments also offer certification services the CIPC. Diversity certification by a governmental agency positions a supplier well to do business in the public sector.

Why is Supplier Diversity important?

A common misconception is that diversity is a quota system or social program designed to benefit selected groups while adding little to no value to the bottom-line. The fact is that a competitive advantage exists, as progressive organizations who have already implemented an effective strategy have realized. A Supplier Diversity commitment benefits a company because it:

• Promotes innovation through the entrance of new products, services, and solutions
• Provides multiple channels from which to procure goods and services
• Drives competition (on price and service levels) between the company’s existing and potential vendors
• Allows a company to take advantage of new opportunities for business expansion with the emergence of new consumer needs based upon shifting demographic realities
• Displays an organization’s commitment to doing business, beyond consumerism, in diverse markets
• Showcases the company’s interest in and commitment to the economic growth of all communities

Supplier diversity is beneficial to all stakeholders, not just to the companies with programs. First and foremost, supplier diversity programming adds economic value because it encourages the growth of diverse businesses. Diverse businesses typically encounter barriers that challenge their start-up and sustainability, so effective supplier diversity strategies can alleviate these pain points.

As small businesses grow, so will our nation’s economy. Since most diverse businesses are small businesses, they aid in the economic recovery and sustainability of their communities. In addition, supplier diversity is important because it provides products and services to emerging consumer markets. While traditional products and services remain available to consumers, demographic shifts create opportunities for diverse suppliers to meet the needs of emerging and/or shifting populations in the South Africa, Africa and across the globe.

Supplier diversity is also important because it assists our country in job creation. South African statistics show that over 50% of the workforce is employed by small businesses. In December 2014, the U.S. Small Business Administration reported 57 consecutive months of new jobs added back to the national workforce after the worst recession in recent history. SBA Administrator, reported “…this new trajectory is attributable to the success of entrepreneurs and the resurgence of our nation’s small businesses. About 7 million of the 10.9 million jobs added back were created not by large corporation, but by start-ups and small enterprises.”

Supplier Diversity Thought Leadership

Thought leadership in supplier diversity is important because it provides a forum for sharing information, resources, tools, methodologies, and experiences to assist in the growth, expansion, and development of the industry. It is also important because it provides information to companies that are attempting to develop effective supplier diversity initiatives. As organizations share their experiences, they enable success within other organizations and in-turn build a stronger industry and stronger communities with stronger diverse businesses.

As the premier provider of Enterprise and Supplier Development (ESD) services and solutions, I am positioned as a thought leader in the industry. I offer resources and solutions that enable supplier diversity success for my clients. My team is comprised of Enterprise and Supplier Development (ESD) experts and supplier diversity leaders from the corporate, government, non-profit, and technology sectors. With over 40 years of combined Enterprise and Supplier Development (ESD) and supplier diversity experience, our solutions are designed to solve real-life Enterprise and Supplier Development (ESD) challenges that can help our clients achieve their operational objectives.

For reliable Expert service on Supplier Diversity, Preferential Procurement, Enterprise Development and Supplier Development contact Nelson Sebati, Pr.EAd today or visit www.enterprisesupplierdevelopment.co.za for more information. 

Enterprise and Supplier Development News

Dear SMALL BLACK BUSINESSES, When it comes to 3rd Party ESD Intermediaries, some people and companies just TALK & ACT like they want to help you. Be aware and do not let other people pimp you for their own benefit.....

For reliable Expert service on Supplier Diversity, Preferential Procurement, Enterprise Development and Supplier Development contact Nelson Sebati, Pr.EAd today or visit www.enterprisesupplierdevelopment.co.za for more information. 

BBBEE ALERT: Black Industrialist Indaba 25 - 26 March 2015......

For reliable Expert service on Supplier Diversity, Preferential Procurement, Enterprise Development and Supplier Development contact Nelson Sebati, Pr.EAd today or visit www.enterprisesupplierdevelopment.co.za for more information.