Dell, Hewlett-Packard, Microsoft, Accenture, IBM and Oracle have spelled out their thoughts about what an ICT charter should incorporate and how it should address the issue of equity ownership.
Speaking on behalf of the group at the ICT empowerment charter indaba held on Tuesday and Wednesday, IBM senior consultant Andrew Jackson highlighted the issues the companies felt should be addressed within the charter.
[VIDEO]"Firstly, we believe the charter should be based on the Department of Trade and Industry (DTI) strategy document utilising a scorecard system for broad-based black economic empowerment [BEE]."
Jackson said broad-based empowerment was key and the group felt the components of the DTI strategy documents need to be phased in over a 10-year period.
"There needs to be a standard of recognition for implementation of the charter. Companies should either be classified as being compliant or non-compliant with the charter, and compliance should be a requirement in public sector procurement, including procurement done across industries," he said.
Jackson said the group also recognised that skills development should be a key component of the charter, and needed to have its own category as well as being treated in the broader context of empowerment.
"We believe that multinational wholly-owned subsidiaries have a significant contribution to make to the economy, providing choice and competition for local industry, a key stepping-stone into Africa, and assist in supporting global competitiveness."
Jackson also raised the issue of equity ownership and said the group proposed equity equivalents because multinationals were not organised or governed around the needs of countries, but around service and product lines and the demands of foreign shareholders.
Economic drivers
[VIDEO]Accenture associate director Ken Robinson said the group realised there were economic needs driving the calls for black equity ownership and that the group fully supported that BEE had to result in increased access to the economy by black people.
To achieve this end, Robinson said the group had come up with four equity alternatives because of the restrictions that bound multinationals in the issue of equity ownership.
"Firstly, we recognise that black equity ownership provides for control over the economy. We therefore believe that by investing in BEE companies as an equity equivalent, we will create for those companies a control over aspects of the economy," he said.
Secondly, Robinson said equity ownership would create re-investment in SA. He said the group could provide more local investment by investing more capital in the country, or by withholding dividends that would then be reinvested into the country.
He said companies using SA as a gateway to Africa would also be providing a source of re-investment.
[VIDEO]"Thirdly, black equity ownership provides share and wealth creation. As an equivalent, BEE consortiums can share in capital with wholly-owned subsidiaries," he said.
Lastly, Robinson said in order to support meaningful positions being held by black management, company board members should be at least 26% black as an equivalent to the minimum target for BEE companies.
"We believe equity equivalents can meet the objectives for direct empowerment and by equating the equity equivalents with the cost of accommodation in the transfer of equity, we believe we can equate the impact of equity equivalents with an equity percentage that can then be valued in the scorecard," he said.
To download the complete PowerPoint presentation given by the multinationals, click here.
Share
