Elements & Scorecards
Depending on the past financial year’s revenue, a company is categorised either as Exempt Micro Enterprise (EME) under ZAR 10m revenue, Qualifying Small Enterprise (QSE) between ZAR 10m and ZAR 50m revenue or Large Enterprise (Generic) over ZAR 50m revenue.
Non Profit Companies have their own scorecard as State-Owned Companies too. External Companies cannot obtain a BEE Score.
The basic scorecard to calculate a BEE rating based on the points achieved in the past financial year comprises of five elements, three primary and two secondary:
- Ownership (primary)
- Management Control (secondary)
- Skills Development (primary)
- Supplier & Enterprise Development (primary)
- Socio-Economic Development (secondary)
While EME are graded based only on “Ownership”, QSE require to achieve reduced targets within the scorecard elements and Generics need to reach all targets and score points in all five elements. The outcome for QSE and Generic Scorecard calculations is a score between 0 and 100 and in turn recognises BEE Levels between 8 (worst) and 1 (best).
QSE and GENERIC scorecards now differentiate between primary and secondary elements. While secondary elements are treated as before, primary elements now contain sub-minimum targets, which equates to 40% of the general target of the element. If a company fails to reach the sub-minimum target, it will be downgraded a whole BEE Recognition Level in the end.
End the Myths
As most writers and journalists do not understand the intricacies and mechanisms of calculating points in the various Scorecards please take note of the following:
- FALSE: Obtaining a BEE Certificate necessitates giving shares to a black partner
- FALSE: Foreign or white owned companies cannot get a BEE Certificate
- FALSE: The more black people I employ the more points are generated in the scorecard
- FALSE: BEE Certificates only play a role if a company tenders for public contracts
- TRUE: A BEE Certificate is possible without having a single black person employed
- TRUE: “Black” is not limited to black citizens, but includes other non-white ethnic groups
- TRUE: Female or disabled black employees often score more points than their male counterparts
- TRUE: A Chartered Accountant is no longer a qualified Verificator
- TRUE: BEE Certificates for enhanced recognised EME and QSE have the format of an Affidavit