MEETING THE BEE CHALLENGE

New rating system means that Ecoserv buzzes from being a Level Five contributor to a Level Two

One of the most fundamental challenges facing any company – whether it's an SMME or multi-national corporate with offices in the world's capitals – operating in 21 st Century South Africa is BEE.

Measurement areas for broad-based black economic empowerment include seven macro-categories such as Ownership, Employment Equity, Management Control, Skills Development and Preferential Procurement. And I dub them “macro-categories” as they're yet further sub-divided into sub-sections. Ownership is broken down into Voting Rights (Exercisable voting rights – Black people), Economic Interest (Black people), Realisation Points (Ownership fulfillment), and Bonus Points (Ownership by Black women; Participants in distributor or employer schemes).

Complex perhaps to the layman, but not impenetrably so.

Companies such as Ecoserv, which was defined as a Qualifying Small Enterprise – in other words, one with a turnover of R5 to R35-million – can be classified as anything from a Level One to a Level Eight contributor, with Level One being the most aspirational, obviously.

Ecoserv, happily, qualified as a Level Two contributor in a new assessment in mid-January, which means that it has a BEE Procurement Recognition Level of a commendable 125 percent. It should, however, be noted that this score is still to be officially ratified as this was an unqualified audit – but ratification or verification should happen closer to the end of 2008.

Meanwhile, there were several reasons for Ecoserv's commendable scoring. One of them was the fact that company has been implementing BEE practices since long before they became obligatory, or even fashionable, as cynics might say.

Indeed, the company has a long history of fair employment practices at its very core – all the same, MD Quentin Hurt is pleased indeed with this rating.

And in some categories, the company truly shone. For instance, in the area of Employment Equity and HR Development (Employment Equity), Ecoserv scored 25 out of a possible 26. And in Indirect Empowerment (Socio-Economic Development) it scored a commendable 25 out of 25.

But in some categories, quite frankly, it lagged. These include Ownership and Management Control. However, there are legitimate reasons for this – and Ecoserv sees them more as a challenge than an impediment or obstacle.

“The reality is that we are 100-percent owned by a Swiss company – listed on the Swiss stock exchange – called SGS. So in terms of Ownership Control that does pose a particular challenge, as it does to all multi-nationals operating in South Africa ,” explains Quentin. “I know for a fact that SGS is acutely aware of this and is trying to deal with it.”

He mentions, for instance, the case of SGS Emoyeni – which is a more than 50% black-owned company that is in partnership with SGS, adding that that's something the MD of SGS, South Africa , Heinrich Williams, is actively dealing with.

But, to an earlier point, transformation, and indeed its bedfellows affirmative action and BEE, is hardly a novel concept at Ecoserv.

“When we started the company in 1994,” says Quentin , “we were a product of the new dispensation, and so we've long recognised that we're part of the transformation process.”

He adds that the question of training and development is also something that Ecoserv feels strongly committed to – and proud of.

“At any given time, around one-third of our staff is doing further training, such as degrees or even post-graduate degrees, for which Ecoserv provides the funding in terms of bursaries."

“It's great to be involved in a company where there's that level of commitment.”

Of course, while this currently remains an unqualified audit, it was based on an intensive review – and just one of the reasons for an increased rating, according to Tony Kruger , of DRG Outsourcing, which oversaw Ecoserv's initial assessment, is the fact that the company's overall staff profile is even more broadly representative of a greater population group and gender than ever. This in turn has had a knock-on effect on the skills development area of the scorecard.

“There's work to do, but it's still a very gratifying step in the right direction,” said Quentin .