The keyboard on my PC has redesignated keys and I can't find the hashtag thing (known as a sharp in music). Back to the hashtag #Standardswillfall. This refers to the incredible likelihood that verification standards that were never particularly high anyway are going to plummet. The BEE commissioner will attempt to prevent this with her well-spelled documents but will not make any difference. Not that I particularly care either way. And here are the Shaun Abrahams-approved theories as to why.
We are dealing with a very complex document. The complexity is exacerbated by the lack of clarity. As I have mentioned on these pages before it takes me an afternoon to figure out the employment equity score. I have already decided that for clients based in Gauteng I'm not going to bother with Coloured and Indian employees, their contribution is so negligible. The complexity has two aspects to it, the first is that it is complex for those who have to implement the codes and secondly for those who have to measure the performance
The demise of forests is imminent. Long complex files will need to be compiled with copies of BEE certificates and invoices and ID books and payslips. The proof of empowering supplier status will take multiple lever arch files. Can you imagine how long it would take for a large corporate like Standard Bank to prove that is a) compliant with all regulatory requirements in the country, and b) a good citizen. If you haven't guessed yet, it would take months.
Quite simple really. These codes are ridiculously hard to interpret, harder to comply with and unviable to implement. If you, as a verification agency (VA) had to conduct a proper audit just to meet the basic requirements to become an empowering supplier it would take a few resources months. No verification agency is going to do this because it will cost them too much money to do so and their clients are not going to pay more. You see the market is used to old codes pricing. Any sane verification agency will know that you cannot devote resources to something and run at a loss. In other words – old codes pricing will prevail.
IRBA says no more, SANAS is the man
Oops, that's a little colonialist. Now back to the crux. There are about 20 times the number of IRBA VAs than SANAS ones. I have little faith in SANAS, I think the people working for them are nowhere near the calibre of the people working at IRBA. Also they get off on ridiculous procedures and mountains of paperwork. The migration from IRBA to SANAS is not going to be seamless. It's going to be painful and long – just like standard six. I have heard that a certain construction company held a day long BEE course for its core suppliers and told all delegates that IRBA certificates issued after September 2016 will no longer be accepted. One this is stupid and two as far as I know there is a further grace period until the end of this year (2016).
The big problem here is bottlenecks. There are in the region of 450 VAs operating in the country, the breakdown is round about 400 IRBA and the balance SANAS. This is good enough to cater for the demands of the economy. If SANAS is going to sit on files for six months then very few BEE certificates are going to be issued after the first of January. I can see the DTI's attitude – a Zuma-endorsed, it's not my fault, or problem. This is the DTI's problem. IRBA wants out, they don't want anything to do with BEE anymore. If fifty odd VAs are left at the beginning of next year they are going to have to move very quickly to get certificates out. Standards will have to drop
The BEE Commissioner is ……
Noble, honourable, keen as mustard and in for a big surprise. Her non-binding, idealistic, well written guidelines will be ignored. They have to be because they are idealistic ambitions that require more effort than is financially viable. She will soon realise that she might as well go back and moan about the levels of fronting. She may try and stamp her authority on the VAs, telling them that they have cut corners etc. They will have to ignore her because there will be no business to be had if they do. It's one thing to play with the taxpayer's money (like the whole government) it's another thing to play with your own.
What I would do. Produce a complicated, long file with samples and ID books and BEE certificates and contracts and you will get your certificate. Most requirements are going to be done by ticking boxes. If a VA cannot find that a company is an empowering supplier then they can't continue with the verification. This means that they will not be able to charge more. Expect every company to be an empowering supplier. Those VAs that actually check your work will soon go out of business.