Does the BEE environment provide for transformation in the business environment? This question was put under the spotlight during a panel discussion at the Agbiz congress in Somerset West last week. Participants agreed that, even though there were problems with BEE, it was the right thing to do and that there were many success stories regarding BEE and transformation projects.

Chris Venter, CEO of Afgri, said that his company strongly believed in, and supported transformation, but not in the form of replacement. “We cannot afford to lose skilled people and replace them with unskilled people,” he stated.

According to Venter, the problem that businesses face, is the ever-shifting goal-posts of BEE, which means that, despite a company’s best efforts, it could be downgraded should new BEE codes come into practice. “The focus becomes negative as one constantly has to strive to make the winning line. The government needs to do more. It must create an environment and provide policies that will enable agribusinesses to grow. Government must provide certainty and plan 20 years ahead,” he said.

However, Venter pointed out that farmers and agribusinesses also had to play their part. “Appoint people who can help you with transformation. Accept the responsibility to transform people in a sustainable way. Then it will happen.”

Joe Maswanganyi, general manager: corporate services of Senwes, said he was unsure if the BEE environment was conducive. “We have the BEE environment and we have to operate within it. The question is: How can we achieve transformation within this environment?”

Maswanganyi said he believed that a paradigm shift was necessary to relieve poverty and combat inequality. “We need a long-term and sustainable plan to transform. A collective effort by agribusinesses is needed. The problem is that the BEE policy is vague and sometimes contradictory. It is not always clear what is expected from us. Corruption in the public and private sector also does not help.”

Maswanganyi also pointed out that the BEE policy was expensive to implement. “One has to focus on the money you spend on inputs and not on outputs. It is also difficult for companies to retain black talent.” Although there were a number of successful BEE projects in the agro-sector and the industry did reasonably well with regard to socio-economic development, the sector has not performed too well in the BEE arena. “With the new codes coming into effect next year, most companies will be incompliant,” he said.

Angelo Peterson, general manager: corporate services of Capespan, said that minimum wages could not be in South Africa’s best interests, as they did not foster entrepreneurship. “I believe that labour unions and the government have too much power. The influence of labour unions on the economy results in poor economic growth and poor global competitiveness. This creates a bad investment climate.

“The BEE environment is a source of frustration for businesses. Foreign investors do not ask what your BEE score-card looks like. They trust that you will follow fair labour practices. We know that people need upliftment and skills development. This is usually contained in our business proposal. We do not need a certificate for this.

“Although we support BEE, the policy has unintended consequences. Often, people who formulate legislation such as BEE, are not businessmen and do not realise the practical implications of the legislation. We should move away from the mentality of ticking boxes and prescriptive legislation. Companies manipulate this legislation to be compliant. It is easy to do. What we need is a strategic approach to transformation that will enable us to grow our businesses,” Petersen said.

The panel concluded that businessmen should familiarise themselves with the new BEE codes that will come into effect next year, plan for these codes and manage them.