CONTRACT WITH SOUTH AFRICA
We believe in South Africa’s future and we share the values set out in its constitution. We want to play our full part in the transformation South Africa so desperately needs. Our contract is a commitment to deliver a better society for our children and grandchildren.
It is a pledge to do all we can to:
- Create jobs, by growing the economy.
- Encourage and empower senior black leadership.
- Invest in South Africans.
- Invest in communities.
- Support small businesses.
- Condemn and root out corruption.
The business community does not have an overarching plan to create jobs. Ultimately it will come down to the plans of individual businesses. What BLSA members are saying through the contract is that we understand the crucial priority of job creation and will prioritise it within our individual businesses. But, crucially, we are also saying that we cannot do this alone – and that we need government and labour to work with us to create the right circumstances where the economy will grow and jobs will be created.
For us to build on this and to drive growth and economic transformation, we call on the government to end corruption and state capture and to work with us to provide the conditions for growth and job creation.
There is no question that if the South African economy enters a sustained growth trajectory, it will create jobs on a large scale. It may be that the specific circumstances of some industries may see them shed jobs. An example would be the effect automation might have on an industry like banks. But that will not stop jobs being created in younger industries such as tourism where South Africa has strong advantages. What is imperative is the role of the government in creating the policy conditions for business and the economy to succeed. Sound economic policy from government is fundamental.
Business has made considerable strides towards transformation but there is no argument that there is much more to do. All good businesses understand that.
BLSA constantly strives to ensure growth, equality of opportunity, and genuine transformation. These include the activities of the CEO initiative, such as the SME fund, and through our participation in BUSA (Business Unity South Africa) and with other stakeholders.
We are committed to transformation within the business sector and supporting black-owned and managed supplier businesses. BLSA embraces the BBBEE (Broad-Based Black Economic Empowerment) scorecard in a way that gives weight to substance over form and that acknowledges the role of business as a positive force for society. We pledge to grow a new generation of black business leaders and entrepreneurs.
BLSA is working to ensure that all South Africans have equal chances to become business leaders. We know that women have always played a critical role in our society but their importance has not always been properly recognised and respected. We have come a long way as a country in this regard, but there is still much work to do.
We all have a part to play to promote a more equitable gender balance when it comes to employment opportunities, pay and education. We need more opportunities in business for mentorship, we need to invest and nurture our country’s entrepreneurs and small businesses, and we need to work with civil society and government to make it happen.
There is no greater investment any community or nation can make than investing in the women of their societies. They are our mothers, our sisters, our daughters – the backbone of our society and our past, present and future. This is even more true in South Africa.
This view sits at the heart of BLSA and its members, where inspiring, strong, intelligent women can be found in positions from entry level to CEOs.
The contract has enormous symbolic value. Business has made a very public pledge of its commitment to this country. It expects to be held accountable against these pledges, and will be transparent in the progress it is making. It is a very significant statement of intent by Business to play a constructive and engaged role in building a better South Africa. It is business’s way of saying that we need to do everything in our power to address the maladies that plague our society.
Business has already made some significant commitments at an industry level such as those through the CEO Initiative. And we are committed to doing more. Business has a responsibility to lead, especially in such challenging times as these.
We announced a strategic objective to make a difference in the areas we have outlined – job creation, small business support, investing in black leadership and communities and the aim is to make progress against these objectives through the activities of our members. We are very confident that with the correct policy environment and the restoration of economic confidence, the economy will grow in a manner that will allow us to make significant progress against delivering these objectives.
Our Integrity Pledge, states that we (business) will have zero tolerance for corruption in our own midst, that we will not act anti-competitively and that we will protect whistleblowers and provide information. Each of our members will promote the pledge internally in their companies.
We are determined to play our part in preventing and defeating corruption, to reaffirm honesty, respect for the rule of law, accountability, transparency and putting South Africa first. To achieve this, we will act with courage, integrity and consistency.
Each of the BLSA member companies will sign our Integrity Pledge which includes a commitment to protect whistle-blowers and provide information.
We will on a voluntary and timely basis provide all information required by the authorities to combat corruption. Where there is a reasonable suspicion of corruption, we will engage independent investigators, act on their recommendations and publish their findings. We will be honest in our dealings with the media and the public.
THE BLSA, THE PRIVATE SECTOR & MATTERS OF CORPORATE GOVERNANCE
We are conscious our membership represents larger businesses which is not representative of many medium sized or smaller businesses. But what we have in common is much greater than what sets us apart, namely that we all need a growing economy to create jobs and prosperity. This is absolutely central to what we are trying to achieve in terms of promoting inclusive growth that will support job creation and transformation. So to this extent BLSA’s initiatives are in the interests of all businesses, not just our own members.
BLSA took the decision to suspend KPMG and Eskom in light of numerous allegations of corrupt behaviour and colossal failures of corporate governance and accountability.
This behaviour is entirely at odds with the values of BLSA, captured in our Integrity pledge. Neither of the SOEs were able to give BLSA comfort that they appreciated the seriousness of the issues at hand, or that they had the requisite will and purpose to put their houses in order. This left BLSA with no choice but to suspend their memberships from the organisation. We have to live by our values and will take a zero-tolerance approach to any organisation found in breach.
While KPMG and Eskom has badly let themselves down in South Africa, BLSA recognises that the overwhelming bulk of KPMG’s and Eskom’s staff are committed, honourable and diligent individuals who were not implicated in “state capture” activities. They remain an asset to the South African economy.
We are very confident that the South African business sector is overwhelmingly honest and above board in its dealings, and that certainly includes our members. There is no comparison with the situation of government where there is very widespread corruption at all levels. Additionally, in as much as there has been evidence of corruption, this has been very much focused on the State Owned Enterprises and the businesses they transact with, many of whom are not mainstream businesses.
Having said this, it is clearly true that corruption is unacceptable wherever it occurs, whether in government or business. We take very seriously the conduct of our members - we cannot say we want to lead and then turn a blind eye to wrong doing. For this reason, we developed an Integrity Pledge which will hold members to the country’s world-leading corporate governance standards. We expect them to evaluate their businesses to determine where practices allow for corruption, collusion, or fraud and redesign incentives and accountability. It is not enough to obey the law. That we expect and take for granted. Companies also need to live by the standards of citizenship and decency that society expects.
Each company and individual implicated in any form of unethical practice is entitled to a proper and fair hearing, based on facts and impartiality. Until we have the outcome of those processes, we will not be passing judgement. Each company has dealt with employees in question as appropriate for the stage of the investigation.
Our members must act in instances of inappropriate conduct. If it is judged that their conduct, values or continued membership of BLSA is inappropriate then we will evaluate their membership. We cannot number amongst ourselves companies unwilling to uphold the law.
We are part of a large community of social partners and civil society who are active in various ways to form principled alliances around shared concerns. Our unifying force is the story of corruption and state capture – we all believe it must end. We regularly meet with the likes of COSATU and we have been an active voice within, and supportive of, FutureSA. Our society is stronger when it unifies and works together around common goals.
All actors in society – including the business communities and the sectors within - benefit from organisations that serve to bring parties together, unite interests and allow them to organise and speak with the same voice. This is even more important in challenging times such as what we’re facing now in South Africa. Our strong membership base proves the confidence in the BLSA and its relevance to society.
BLSA and our individual members work closely with government and relevant ministers to ensure that the perspective of Business is heard. The relationship between business and government was damaged by the firing of finance minister Pravin Gordhan so we are currently in a process of trying to rebuild trust.
We are not a political organisation nor do we seek a fight with the government. Corruption and state capture must be called out in any society, from wherever it takes root – it adversely affects our employees and their families as well as South Africa’s citizens relying on assistance from government. Both are a fundamental impediment to the rule of law, growth, transformation and progress. The longer it is allowed to continue, the further away we get all get from living in the type of South Africa we all envision and that was laid out in our Constitution in 1994.
SME FUNDING OPTIONS
Individuals and businesses can contact any of the below organisations to investigate funding options.
A. FINANCIAL LOANS
At Genfin, we share the desire to see thriving businesses grow. Our commitment to quick business assessments and sensible decisions make us the perfect funding partner for your business. Clients can count on Genfin working with them to find the right solution for their business funding needs.
Lulalend is more than a company. It’s a belief in the power of small business, making a difference, building a better solution and striving for excellence. We work hard to empower businesses across South Africa with the funds they need to grow, and we have a great time doing it!
Are you an entrepreneur needing finance? Finfind links you with the all the lenders across the country that match your specific funding needs - there are over 300 offerings. Supported by: Small Enterprise Development Agency (Seda) and The Department of Small Business Development, USAID
At ProfitShare Partners, we believe that entrepreneurs and emerging businesses are the drivers of the economy. We are bridging that gap. Our approach is to enable businesses, particularly SMMEs, by offering a solution that will assist them in delivering on their contracts by financing the deal and supporting the full project through to delivery. We are also focused on the supply market and can offer solutions that will grow businesses substantially within a period of two to three years.
B. FUNDING OPTIONS
At Vumela, we think that helping SMEs grow is the single most powerful way to transform South Africa – by creating jobs and addressing poverty. After all, many South African SMEs struggle to scale or fail altogether because they don’t have access to the necessary funding, skills or support. That’s why we provide venture capital funding, from R2 million up to R20 million, to South African SMEs who show potential to scale exponentially. But businesses get much more than just funding:
- We offer non-financial growth support that includes participation in our cutting-edge accelerator programme for Scale Ups called 10X-e.
- We’re majority black-owned, so any shareholding we take will be considered black equity.
Angel Investment Network
Unlike banks or other financial institutions, angel investors are willing to take a chance and invest smaller amounts of money in high-risk businesses, with the hopes of gaining high returns within a set period of time (usually five to ten years). These wealthy individuals use their own funds to finance projects that they believe will be lucrative or where they can use their talent and skill to mentor new entrepreneurs. Connect with potential angel investors and new business entrepreneurs on the Angel Investment Network, operating in countries all around the world. 153,438 registered angel investors looking for projects like yours. Submit a pitch and we’ll help you find an investor.
Masisizane Fund (‘Masisizane’)
The Masisizane Fund (‘Masisizane’) is an Old Mutual initiative that was established in 2007 following the closure of the Unclaimed Share Schemes Trust in consultation with the National Treasury of South Africa. Masisizane was set up as a non-profit funding company to provide loan financing and support to small, medium and micro enterprises (SMMEs). Our mandate is to contribute to job creation, reduce inequality, promote economic growth and support, develop and promote entrepreneurship, while attracting investment to SMMEs.
C. CONSULTING AGENCIES
The niche consulting firm specialises in helping entrepreneurs, including black industrialists, access development funding in the form of government grants, incentives or loans from institutions like the Department of Trade and Industry (DTI), Industrial Development Corporation (IDC), National Empowerment Fund (NEF), and Small Enterprise Finance Agency (SEFA).
Khula Enterprise Finance
Khula helps SMMEs to secure loans from banks. It does not lend money itself. Khula also provides mentorship to entrepreneurs, helping them to manage their businesses successfully. The mentorship programme includes the transfer of skills on a face-to-face basis, the development of viable business plans, and pre- and post-loan services.
South African Micro Finance Apex Fund (SAMAF)
SAMAF gives financial services to small-scale entrepreneurs living in rural and outer urban areas. SAMAF does not lend money directly to the public. It uses existing institutions within communities to handle the funds and lend to qualifying entrepreneurs. SAMAF has three products:
- The Micro-Credit Fund (gives loans to entrepreneurs).
- The Capacity Building Fund (gives funds to be used for equipping the institutions with skills, systems and equipment).
- The Savings Mobilisation Fund (encourages savings).
- SAMAF is specifically targeted at young people between the ages of 18 and 35.
D. GOVERNMENT FUNDING AGENCIES
South African government funding and grants are focused on providing funding for business ventures that can make a difference to the economy.
Ministry of Small Business Development
To support the radical transformation of the economy through the promotion and development of sustainable and competitive entrepreneurs, small businesses and co-operatives, that contribute to job creation and economic growth.
Department of Trade and Industry (DTI)
DTI business grants are responsible for actively encouraging small businesses. The DTI is actively searching for new business owners, specifically those who will positively affect South Africa’s economy with an emphasis on valuable job creation. The DTI business grants provide financial support to various economic activities, including manufacturing, business competitiveness, export development, market access and provide a channel for foreign direct investment.
National Empowerment Fund (NEF)
The National Empowerment Fund (NEF) is a driver and thought leader in promoting and facilitating black economic participation by providing financial and non-financial support to black empowered businesses and promoting a culture of savings and investment among black people. The NEF’s role is to support Broad-Based Black Economic Empowerment (BB-BEE). It provides business loans from R250 000 to R75 million across all industry sectors, for start-ups, expansion and equity acquisition purposes.
National Youth Development Agency (NYDA)
The National Youth Development Agency (NYDA) – NYDA provides grant finance in the form of micro-finance grants for survivalist youth entrepreneurship and co-operative grants for greater participation of youth in the co-operatives sector.
Industrial Development Corporation (IDC)
The Industrial Development Corporation (IDC) – Under the IDC, there are multiple funds available offering financial support to start-up businesses needing capital for equipment, working capital and buildings. It also funds business expansion.
KZN Growth Fund
The KZN Growth Fund is an initiative aimed at creating sustainable economic development, job creation and black economic empowerment within the infrastructure sector in the Province of KwaZulu-Natal. The KZN Growth Fund is essentially a debt fund, structured as a unique public-private partnership between the Provincial Government, commercial invitations and development finance institutions. It was established with a mandate to finance medium to large scale infrastructure-related projects throughout KwaZulu-Natal, which drive economic success, stimulate job creation, promote broad-based black economic empowerment (BBBEE) and reduce inequality.
Isivande Women’s Fund
The Isivande Women’s Fund is an exclusive fund that aims to accelerate black economic empowerment by providing more affordable, usable and responsive finance than is currently available. It was originally aimed at women only but opened up now for all black persons in South Africa. The IWF assists with support services to enhance the success of businesses. It pursues deals involving start-up funding, business expansion, business rehabilitation, franchising and bridging finance. The Fund is managed by the Industrial Development Corporation (IDC) on behalf of the DTI through a development fund manager. IDF Managers is an SME financier aimed at supporting the creation of self-sustaining black-owned businesses in South Africa by providing primarily financial and non-financial support to our investee companies.
KFW Development Bank
The German Development Bank (The KfW), is a German government-owned development bank. It finances and supports programmes and projects that mainly involve public sector players in developing countries and emerging economies – from their conception and execution to monitoring their success. Their goal is to help their partner countries fight poverty, maintain peace, protect both the environment and shape globalisation in an appropriate way. To this end its largest subsidiary, KfW IPEX-Bank GmbH, lends to many countries around the world. In 2011, the KfW, together with South Africa’s Industrial Development Corporation (IDC), established the Green Energy Efficiency Fund, a R 500 million fund for energy efficiency and renewable-energy projects. The GEEF supports projects that will provide significant energy savings and/or emissions reductions. Companies in this arena can borrow R1 million to R50 million rand at two percentage points less than the prime lending rate. If your company has less than 201 employees, revenue of less than R51 million or assets of less than R55 million, then you are eligible to apply.
The Land Bank of South Africa is a specialist agricultural bank, wholly owned by the Government, and is a key financial player in agriculture. It is guided by a government mandate to provide financial services to the commercial farming sector and to agri-business, and to make available certain financial products which would facilitate access to finance by new entrants to agriculture from historically disadvantaged backgrounds. The Land Bank offers a broad range of loans for all financial needs like buying land, equipment and working capital for agricultural projects.
Small Enterprise Finance Agency (SEFA)
Small Enterprise Finance Agency commonly known as SEFA was established in 2012 as a result of the merger of South African Micro Apex Fund, Khula Enterprise Finance Ltd and the small business activities of IDC. SEFA‘s mandate is to foster the establishment, survival and growth of SMMEs and contribute towards poverty alleviation and job creation.
The Technology Innovation Agency (TIA)
The objectives are stimulating and intensifying technological innovation in order to improve economic growth. The goal is to increase the quality of life of all South Africans by developing and exploiting technological innovations.