I chaired a two day BEE conference last week and was exposed to some of the finest thinkers in this industry. These include Andrea Brown of Mohlaleng, Kevin Lester (soon to be ex Cliffe Dekker), Robin Woolley, Colin Reddy, Germien du Plessis and Christiaan van der Merwe.
The delegates were largely from the major corporates and government departments in South Africa and all contributed actively to the conference each from their own perspective and BEE charter. It's pleasing to note that the BEE implementers within the country are very clued-up about their subject.
I did notice a few common themes coming through. I'll list them.
- BEE requires you to change your business, but this change must result in growth. Change for change's sake is not a sustainable option.
- Your BEE strategy must be aligned to your business strategy (this was reiterated by almost every speaker).
- Transformation and growth must go hand-in-hand, you can't have one without the other. A brief glimpse at the recent BEE deals highlights this. The successful deals result in the business growing.
- On the subject of deals, Kevin Lester offered a fantastic insight into the world of deals. Firstly - a BEE deal is the same as any other merger or acquisition, any good M&A lawyer is able to draw up the necessary agreements. Secondly, deals should be done because a genuine desire exists to do the deal. Ernst and Young conducted a survey on M&As and found that 80% of them fail; if the desire is lacking the odds are stacked on the deal being a statistic.
- Sandile Hlophe of KPMG coined a new phrase "doing an Mzi". This refers to Mzi Khumalo who has a notorious reputation for buying into companies and then selling that stake a little earlier than intended. Mzi has upset a few big businesses that he has dealt with but his behaviour is typical of any capitalist (more on this later.)
- Rating agencies are a necessary evil to most companies, although almost all of the delegates were opposed to the idea that there was only one rating agency and that they should make use of that agency.
And the final codes - it looks like they'll only come out in October at the earliest.
Comments