Vodacom attains level one BBBEE contributor status
SA’s leading telco Vodacom Group says it has gone up a notch to level one broad-based black economic empowerment (BBBEE) contributor, a rating that gives it an advantage when it comes to competing in a tough marketplace.
The company says the rating is a result of efforts geared towards ensuring the local economy is structured and transformed to enable the meaningful participation of the majority of South African citizens.
The BBBEE ratings are intended to stimulate the process of participation of previously disadvantaged groups in the economy to lead to increased economic growth. The higher the score, the higher the chances of a company being able to take advantage of various opportunities, including favourable tax gains.
Vodacom says it earned level one BBBEE status as a result of its local subsidiaries accelerating a concerted transformation strategy, ensuring the group exceeds its financial year 2019/20 targets against all five components of the BBBEE scorecard.
Subsidiaries Vodacom SA and Nexio retained the previous year’s rating of level one, with X-Link improving from level two to level one.
Vodacom Group CEO Shameel Joosub says: “For Vodacom, a company with strong local roots, this is an exciting achievement. These results are a full demonstration of our commitment to supporting government’s national imperative goals involving the support of black SMMEs, youth employment, skills development and uplifting local communities still trapped in abject poverty.”
Procurement if one of the elements that helped Vodacom attain the latest rating, with the telco spending R35.9 billion on BEE status companies with level four and above.
“Of this spend, Vodacom spent R13 billion with 51% blacked-owned suppliers and R15 billion was spent procuring services from 30% black woman-owned suppliers.”
Vodacom says it procured services to the tune of R3.3 billion from black-owned qualifying small enterprises, R2.3 billion on black suppliers from designated groups, while R1.3 billion was spent on acquiring services from black-owned exempt micro enterprises.
It notes that the focus on enterprise creation and development is key to the ICT sector, saying Vodacom spent R243 million on supplier development and R407 million on SMME development across seven provinces.
“Crucially, the group paid R981 million to black-owned SMME suppliers in three days or less from time of invoice. This is important as local research shows the majority of SMMEs fail because of the failure by local companies to honour invoice payments for service rendered.”
Furthermore, Vodacom says as part of its commitment to continuous employment skills development of its employees, it invested a total of R363 million in skills development, of which 76% was skills spend to black people, including black employees.
“The investment takes into consideration internal and external bursaries, training of staff members, graduate and learnership programmes, training of youth across the country through the Youth Academy, among other costs.”
According to Joosub: “These positive results show that at Vodacom we are serious about the transformation agenda and the development of South Africa. We view broad-based black economic empowerment as an important policy intervention to deal with SA’s inequality. It is my view that no economy can grow by excluding a section of its population, but the economy needs to grow to drive inclusion and this is an area where we will continue to support government.”