CEMENT maker Pretoria Portland Cement (PPC) said yesterday it had achieved a level 4 rating according to the Department of Trade and Industry’s scorecard following the results of its interim broad-based black economic empowerment audit last month.
This is the highest black economic empowerment rating in the cement manufacturing industry to date, which should help the company land large public sector contracts.
CE John Gomersall said the JSE-listed company would not rest on its laurels now that it had achieved such a high rating, and the company still needed to do more equity deals to meet the 26% empowerment equity ownership target of the mining charter.
The company has a 15% black empowerment equity ownership after it sold the stake to black investors last year. However, he said given that empowerment ventures were struggling under the turbulent economic climate, PPC would approach the issue carefully.
“Obviously, between now and 2014 we will need to get to 26% empowered equity ownership, even though this only counts for a small part in the overall rating. We are committed to doing more deals, especially given that we are sitting on cash and are under-geared,” he said.
“We will keep moving forward with empowerment at all levels so that we stay ahead of our competitors.”
Gomersall said last year 80% of the company’s discretionary spend was on previously disadvantaged communities, and three-quarters of the board was now black. When PPC announced its 15% empowerment deal worth R7,2bn last year, it set itself the target to achieve a level 4 status by next year.
It followed this with the appointment of Bheki Sibiya as its first black chairman at the end of last year, and two black non executive directors in February. This brought the number of black non executive directors to six out of a total of eight, of which two are black women.
The latest audit, by verification agency Empowerlogic, uses the black ownership flow-through principle and indicates a level of black ownership rising to more than 25% at the equity level. Other significant contributors to this rating were the company’s investment in skills development within the sector, preferential procurement and meeting employment equity objectives at all levels.
“PPC has always maintained that transformation goes beyond a scorecard and into the domain of making a real difference to the lives of all our stakeholders,” Gomersall said. “We are proud of this industry leading achievement because of our broad-based view to sustainable empowerment. This is why we have made transformation part of the DNA of our business for almost two decades.
“Many people held the view that transformation was all about the 100m dash to win the broad-based black economic empowerment equity race. But we at PPC always believed that real transformation is designed to work bottom-up by empowering our PPC people, uplifting communities, overcoming the skills barrier and investing in the development of black businesses.
“This approach has created meaningful transformation that starts at grassroots level, as opposed to those which have focused initially on black equity transactions.”
