Google the heading of this post and count the number of sites carrying this article - it must be news then. I chose to read the article on (surprise, surprise) Business Day. Standard Bank has identified the 250 black-owned companies that have qualified for shares in the bank as part of its empowerment deal, announced two years ago.
Now to pervert Standard Bank's slogan.
1) Was the deal Inspired?
I would say yes. In order to qualify, applicants must employ people and have a sustainable track-record (you can read the full list of criteria here.)
2) Was the deal Motivated?
Comes back to sustainability. They filtered through 600 applications. I would say this was motivated. Don't forget the BEE shareholding as a motivation point - hence the limitation to black-owned businesses (it is well worth noting that the definition of black follows the codes' definition).
3) Was the deal Involved?
Probably - there are plenty of legal firms and other players that would make it involved and drawn our. The beginnings of this process can be traced to October 2004.
Oh yes - the deal is a little more involved than it appears on the surface. A notice in the Business Day on 3rd of November (page 24) lays down on-going conditions for the new shareholders. Two conditions do a Phutuma Nathi.
The SME must
- continue to be black-owned as defined in the Financial Sector Charter
- not cede, use for security, mortgage, pledge or otherwise encumber its entitlement to benefit (from the scheme).
This means that you can only sell to other black people or black-owned companies (50%+); and you can't use the shareholding as security.
In other words "please be a shareholder on our terms and forget about any of the other privileges of ownership. And we'll take out a double page spread in Business Day on Monday telling the world how great it is".
I wonder if these schemes will be the same when the "once empowered, always empowered" rule comes into play.
Nice attempt Standard Bank - it still smacks of paternalism and gives off a subtle hint of limited-capitalist activity. Wouldn't it have been simpler, better, faster removing some of these conditions?
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