Forestry industry gets in line with Amended BEE Codes

The Department of Trade & Industry gazetted the Amended Forest Sector Code. This Code came into effect from that date and there is no transition period. It is interesting to note that as suppliers of Forest Sector, companies will still have valid certificates in terms of the Original Codes or other original sector codes, which is valid for 12 months after date of issue, it will take some time for all Measured Entities to be measured in terms of the Amended Forest Codes.

NPI CEO, Israel Noko, advises that companies in the sector may in the interim accept valid verification certificates and compliance reports for contributors to their scorecard that was conducted in terms of the Original Codes or any old sector code, for as long as they are valid. The sub-sectors that apply to this BEE sector code are as follows:

Growers sub-sector (plantations, nurseries and indigenous forests)
Contracting sub-sector (forestry contractors in silviculture, harvesting, fire-fighting services and other forestry contracting services that are not covered by their own Sector Codes)
Fibre sub-sector (pulp, paper, paperboard, timber board product, woodchip and wattle bark manufactures)
Sawmilling sub-sector (industrial, structural and mining timber sawmills and match producers)
Pole sub-sector (pole treatment plants)
Charcoal sub-sector (charcoal producers)
Non-timber forest product enterprises such as those involved in honey production, harvesting of mushrooms and medicinal plant, as well as forestry based tourism enterprises.

The new Forestry Sector BEE code has got some certain interesting characteristics, in that it aims to promote the empowerment of rural communities with higher targets in some of the elements, than the 2013 Amended Generic Codes. However, Noko does point out that the thresholds do remain thesame as those of the Generic BEE Codes. The Amended BEE Forestry Codes is specifically being used to address rural development issues. With this Gazette, the Forestry Industry has acknowledged the sustainable impact on these communities particularly black women, that have traditionally been marginalised.

Some of the objectives of the Amended FSC can be summarised as follows:

“Bona Fide” enterprise development that ensures that the main beneficiaries of enterprise development are previously disadvantaged Black People, with a specific focus on marginalised groups.
Provisions for Unincorporated Joint Venture(s) have been made.
Promoting of linkages between enterprise and supplier development initiatives and the socio-economic challenges in rural areas with a specific focus on building sustainable small businesses.
A focus on addressing the poor growth of black women-owned enterprises, through addressing access to finance, business development support, prioritising marginalised and rural black women as well as improving their position in the value chain.
Addressing the structural issues of women and rural people enterprise and supplier development.
Promote the use of broad-based schemes such as cooperatives to prevent development initiatives (ownership, enterprise and supplier development) benefiting only a narrow base of beneficiaries. Emphasis should also be on rural beneficiation.

Generic BEE Scorecard

Element	Target	Points allocation	Bonus Points
Ownership	25% + 1 vote Black Rights of ownership	25	12
Management control	30% to 88% in different job grades	19	0
Skills development	5% of Leviable amount	20	5
Enterprise & Supplier Development	10% to 80% BEE compliant Procurement spend 2% NPAT on Supplier Dev Programmes 1% NPAT Enterprise Dev programmes	43	6
Socio-economic Development	1% Net Profit after Tax	5	3
TOTAL		112	23