Women's Economic Empowerment

30.03.07

Girl POWER on the RISE

By Sibonelo Radebe

New BEE rules emphasise the economic empowerment of women - and especially black women

Companies will be well advised to address the gender equality principle with diligence when tackling broad-based black economic empowerment (BEE).

BEE initiatives that neglect women economic empowerment will draw minimal points from the generic new broad-based BEE scorecard. It's worth noting that there is a new emphasis on black women following concerns that previous initiatives tended to favour white women.

Many BEE initiatives that were considered excellent over the past few years have been blown out of the water because they do not address the gender question. That explains most of the movement in the 2007 Top Empowerment Companies (TEC) survey, which ranked the BEE credentials of companies listed on the main board of the JSE using the new BEE scorecard. Companies that have concluded BEE initiatives with a strong women element, such as Bidvest and Enaleni, made significant strides in the 2007 TEC survey.

The broad-based BEE Codes of Good Practice which were passed into law this year have a strong gender equality principle.

This should be no surprise as the force behind the codes is represented by a woman - Polo Radebe, the director of BEE in the department of trade & industry (DTI).

For a while, SA's economic redistribution plan appeared to have been designed for the exclusive benefit of black men. Black women who suffered a double-edged discrimination as women and as black people - had little space in the BEE programme.

Before the introduction of the first phase of the codes, many BEE transactions were male-dominated and tended to favour the same individuals, says Radebe. Board, executive and senior management appointments also tended to favour black men. Proof of this is reflected in the many equity transfer deals that have come to be seen as the face of BEE.

Research commissioned by the Black Business Executive Circle last year showed disturbingly low levels of participation by women in BEE. It found there were 96 women directors in the top 200 list of the JSE - a mere 4% of the total.

"Despite public commitments, black women have not made much progress on the employment equity element," it concluded.

The finalised codes feature a general principle that calls for 50% women representation in all the key targets of the broad-based BEE scorecard. The codes call for 50% black representation at board level within 10 years of inception. With the gender principle, this means women will have to make 25% board representation. The same principle applies to other elements of the scorecard including management, employment equity and skills development. On the ownership element, the women target is 40% of the total.

This principle has been around for some time, which has facilitated a couple of women-focused BEE deals. A few other women-led empowerment initiatives have come to the fore over the past few years. These may grow on the back of the strong support contained in the codes.

Among the established women's groups are pioneers such as Wiphold, Nozala and WDB Investments.

Wiphold was established in 1994 by a group of enterprising black women - Gloria Serobe, Wendy Luhabe, Louisa Mojela and Nomhle Canca. With greater focus on the financial services industry the group has grown by leaps and bounds to become one of the most prominent BEE groups in the country.

Through Wiphold Investment Trust the group benefits about 18 000 female investors as well as a broader base through the Wiphold NGO Trust.

The group has amassed a respectable portfolio largely from various big BEE equity transactions over the past few years. It was part of a broad-based BEE consortium that landed about 13% of insurance giant Old Mutual SA in a R7,5bn deal concluded in 2005. The Old Mutual deal also gave it a slice of banking group Nedcor and short-term insurance group Mutual & Federal. Wiphold is also part of the controversial Elephant consortium, which got 6% of telecommunication group Telkom. It further owns 100% of Wipcapital, 40% of Future Growth Asset Management and 49% of stockbrokerage Legae Securities, among others.

WDB Investments, formerly known as Women's Development Bank, is another women's group that has caused waves over the past few years. The group was established in 1995 with seed capital of R3m from the WDB Trust, which owns 100% of the former.

WDB's investment portfolio includes a 7,5% stake in BP Southern Africa, 10,5% of Masana Petroleum Solutions, 5% of Uthingo, 25% of Paracon and 3% of Discovery Health.

WDB is also part of various consortia that acquired 15% of services giant Bidvest, 6,5% of FirstRand and 25% of Makalani Holdings' management company.

The group made its first venture into mining in January this year, by participating in a consortium that has established a R7bn joint venture with Anglo Coal.

WDB's parent company, the WDB Trust, is a social development company focused on benefiting women from all parts of the country. "We have no institutional, outside or individual investors and therefore our first priority is to ensure that we fulfil our broader mandate of serving the economic upliftment and social advancement of SA women, primarily black women," says WDB CEO Tanya Slabbert.

The trust's vision is to provide sustainable income-generating opportunities and products and services to women from the lowest income groups.
On top of its social upliftment projects, WDB also manages a microfinance division, WDB Micro Finance, which has been running since 1992. It provides entrepreneurial training and loans of R3 000-R4 000 to poor women.

A group called Peotona represents a new generation in women empowerment. It was established by Cheryl Carolus, Dolly Mokgatle, Thandi Orleyn and Wendy Lucas-Bull in 2005.
Though it has no direct broad-based BEE element, Peotona has already entrenched itself in the mainstream BEE game. It was part of the De Beers BEE equity deal in 2005, which gave it a 26% slice of De Beers S A.

Peotona also featured in the McSteel, Reunert and Lafarge BEE deals.