Page 23 - Q&A 2019/2020

The role of demographics in BEE
BEE Marc Naudé
September 2019

“From our recent BEE verification I’ve come to understand that demographics
have quite a role to play when it comes to your planning for a good BEE
scorecard. However, I’m not quite sure exactly where it comes into play and
how you need to plan for this. Can you shed some light on how I must consider
demographics in our BEE planning?”

Demographics can be defined as statistical data relating to the population
and particular groups within it. While the DTI BEE Codes of Good Practice (“BEE
Codes”) refer to demographics this is not specifically defined. Demographics
also only come into play under the Generic scorecard while Qualifying Small
Enterprises (QSEs) and Exempt Micro Enterprises (EMEs) are unaffected.

In respect of the Generic scorecard, demographics are used to determine
the points allocated for the different race and gender groups under certain
elements. If an element, for example, states that there are two points available
if 60% of Senior Management are black then having one Indian male and one
Indian female as the only two Senior Managers would seem to meet that criteria
and you would expect to score the two points. This is not the case, however,
as these points are awarded according to the demographic representation.
So, because Indian people only make up a small percentage of our country’s
demographics the business would only be awarded a small percentage of the
points.

The demographic targets are however only applicable to the Management
and Skills Development Elements and then further only to certain sub-categories
within these elements. Where demographics do play a role Economically Active
Population (EAP) statistics are used to determine the targets. EAP includes all
people between the ages of 15 and 64 who are either employed or seeking
employment. The EAP statistics are tracked by Stats SA and published on a
quarterly basis.

There was previously some uncertainty regarding the use of national
demographics versus regional demographics but this has now been clarified.
Where a business has a national footprint, for example it has offices in more than
one province, the national demographics will apply but where the business
only has one office and does business only in that particular province then the
regional demographics will apply.

It is vital when planning for a BEE verification that the EAP targets are kept in
mind as the Skills Development element in particular will be affected by these
targets. If the calculation is done manually there are more than 50 individual
calculations that may be required in order to determine an accurate score

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