ICT Empowerment Charter

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ICT Empowerment Charter

• Indaba 2
• 14th May 2004

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Inputs since First Draft

• Roadshows in 8 Provinces
• Advisory Provincial groups established to
  co-ordinate further inputs
• Industry Associations contributions, each the
  result of workshops and/or other deliberations
• Telecoms Operator grouping inputs
• Continuing inputs from individuals and companies

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Some Concerns Raised

• Access to funding
• Fronting
• Foreign based ICT Enterprises
• Indirect ownership
• Family owned SMMEs
• Skills building Technical and Management skills
• Measurement tools for Enterprise Development

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Actions Taken

• Consolidation of inputs into categories
• Grouping of objectives, challenges, comments and
  recommendations
• Editing to join common threads
• Restructuring to incorporate inputs and include
  recommendations
• Workshopping to finalise draft

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Typical Recommendations 5.1 Equity Ownership

• Funding should be made available by State
  organisations, including Treasury
• A checklist to review valuation methods to
  determine the Rand value of BEE investments needs
  to be established by the ICT Council
• Dividend policies must be adaptable and balance
  the need to repay debt finance and the working
  capital requirements of the BEE company
• Equity equivalents lobby for from some
  multinationals is balanced by an even stronger
  local lobby against
• Working Group to facilitate solution
• Continued.

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Typical Recommendations 5.1 Equity Ownership

• Fronting the ICT Council must publish a clear
  definition of fronting and what is prohibited,
  with punitive measures
• State owned enterprises remain a concern
  regarding equity
• Special consideration needs to be given to broad
  based collective ownership and ESOPS
• BEE Shareholding needs addressing with reference
  to the sale of BEE shares on the open market
• Compliance should be measured at holding company
  level where there is a centralised BEE policy,
  and at subsidiary level for companies with a
  decentralised policy. One rule should apply for
  all companies in the same group.

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Typical Recommendations 5.2 Management and
Control

• Job hopping The pool of black managers must be
  increased by training to combat this phenomenon
• Black management development programmes need to
  be made more available, accessible and affordable
  (including via SETAs)
• Companies must have written strategies setting
  out leadership development programmes,
  mentoring and succession planning.
• Listed companies must publish in their annual
  reports information concerning black directors.
• Scored as Employment Equity

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Typical Recommendations 5.3 Employment Equity

• Employment Equity Act rules should apply except
  that the line above which compliance is required
  be set to 10 persons in an SMME
• Annual audited reports should include EE
  situation
• 2 of payroll budgeted for EE training, of which
  20 to be for development of womens skills

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Typical Recommendations5.4 Skills Development

• Business has to be incentivised to get more
  involved
• Need for Management training learnerships
• Sector SETAs (ISETT, MAPP Services) must
  undertake continuous and ongoing research into
  what skills are needed over a certain time frame.
• SETAs must facilitate partnerships between
  academic institutions, training providers and
  business.
• Mentorship and coaching has an important role to
  play.
• Multinationals should assist in developing global
  skills

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Typical Recommendations5.5 Preferential
Procurement

• Lack of suitable BEE suppliers purchasers must
  participate in Enterprise Development
• Quality purchasers must support supply
  agreements that include quality management
  processes
• Preferential payment cycles
• Improved delivery mechanisms within SITA
• Provincial procurement National bodies should
  procure within a Province the ICT needs of that
  Province, and support corresponding skills
  development
• Best Practice the ICT Council should prepare a
  code of good practice based on world standards.

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Typical Recommendations5.6 Enterprise
Development

• Fronting will not be tolerated!
• Partnerships and alliances to be encouraged
• Such alliances must be based on clear agreements
  and objectives
• SMME development strategy needs a co-ordinated
  industry effort for sustainability, augmenting
  and supporting other programmes e.g. the DTI.
• Co-ordination between incubation hubs, higher
  learning institutions, etc
• Black supplier development programme..

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Typical Recommendations5.6 Enterprise
Development Black Supplier Development Programme

• Price preference
• Set asides
• Early payment cycle
• Price matching
• Skills and technology transfer
• Advice on tender process
• Certification of suppliers by purchaser

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Typical Recommendations5.7 Residual Category

• Need to clarify the basis on which Digital Divide
  projects are accredited
• Close monitoring of CTI needed, with an
  integrated plan taking into account other
  stakeholders (DoC.)
• Encourage growth outside of major metropolitan
  areas
• CSI investment has both ends of the spectrum ICT
  focussed, and general
• BEE Council must establish a fund to allow SMMEs
  to contribute to CSI without having themselves
  executing projects due to lack of capacity
• Access targets by 2010, by 2014.? E.g.
  Gauteng-on-line

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Next Steps

• 1-day stakeholders Indaba on Friday 14 May 2004
  at Vodaworld.
• Presentation at Futurex on 18th May Sandton
  Convention Centre handover of Draft Charter to
  Government
• Closing of submissions on 24th May 2004
• Facilitation of negotiations on any outstanding
  contentious issues
• Release of the final charter on schedule on 25
  June 2004 or as soon thereafter as circumstances
  will dictate
• Formation of the ICT BEE Council

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Next Steps

• Post-adoption implementation phase of the
  charter. We urge discussants to give some serious
  thought to this issue. After all, the
  implementation phase is likely to go into the
  next decade and will therefore span a longer
  period than the policy formulation stage.
• Moreover, the work of economical transformation
  will never be finished in our lifetime.
  Continuous revision and improvement of our
  socio-economic strategies is an inherent part of
  our evolving new country.

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Thanks!

• Many thanks to our sector companies who
  generously sponsored this process namely,
  Vodacom, Telkom, SAP, HP, IBM, Microsoft, Dell,
  CSC, Arivia.kom (all Platinum), Oracle, Business
  Connexion (Gold), Altron and T-systems (Silver)
  as well as MTN and Didata (Bronze). Additional
  specialised sponsorship was received from
  CompTIA, Pearson VUE and Torque-IT.
• Thanks also to the internal Research Team with
  some full time staff and volunteers, which is
  headed up by Tebogo Khaas, CE of Digital IQ (Pty)
  Ltd. A special word of gratitude must go to HP
  who have availed office space and other
  infrastructure for our Research Unit at their
  Head Office in Rivonia. The unit is augmented by
  the services of two independent agencies,
  Empowerdex and Forge Ahead whose valuable input
  has been procured at give-away minimum charges.
  We thank them immeasurably.
• I would also wish to once more again thank SAP,
  Multichoice Africa and the State Information
  Technology Agency (SITA) who all have generously
  contributed to the funding of the road-show.
• Last but not least, thanks to the Working Group,
  and especially to the Task Team who have worked
  long hours at night and over weekends to bring
  you this third draft.

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• Hamba Digital Divide!
• Woza Transformation!

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Contact Information

• URL www.ictcharter.org.za
• Email research_at_ictcharter.org.za
• Telephone [phone]
• Fax [phone]

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ICT Empowerment Charter

• Indaba 2
• 14th May 2004