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Tourism BEE Industry Transformation Charter and Scorecard

Category: Policy/Strategy
Binomial Name: Government of the Republic of South Africa
Date: 8 May 2005
Sub Category:Policy/Strategy (South Africa)
Location:Republic of South Africa
Alternative Names:
  • Tourism BEE (Black Economic Empowerment) Charter and Scorecard
  • Subject Matter:Collaboration / Partnership | Economic Development | Employment and Training | Tourism
    URL: http://www.environment.gov.za/TourismIndaba_2005/docs/tourism_bee_charter_scorecard.pdf
    Summary Information:
    The Tourism BEE (Black Economic Empowerment) Charter and Scorecard was launched on 8 May 2005 by the Minister of Environmental Affairs and Tourism.

    The Charter provides a basis for transforming the South African tourism sector to incorporate the principles of Black Economic Empowerment ('BEE'). BEE is one of the range of measures being used to counteract the economic effects of apartheid in South Africa.


    Detailed Information:
    Application

    The Charter applies to the entire tourism sector, including accommodation, hospitality and related services and travel distribution systems. However, it will apply in a qualified manner with respect to 'small businesses', which are defined as entities with an annual turnover of less than R$5 million and less than 50 employees.

    The Charter establishes two phases of evaluation with distinct Scorecard targets. The first phase spans for five years from the Charter's commencement until 31 December 2009, and the second phase runs until 31 December 2014.

    The Charter is awaiting alignment with the BEE Codes of Good Practice (see link below) in order to be gazetted under the Broad Based Black Economic Empowerment Act 2003 ('the Act') (Tourism BEE Charter Council, Stakeholder Update, July 2006). Adoption of the Charter under section 12 of the Act would render the Charter a statement of intent, which does not create legally binding obligations.

    Purpose

    The aim of the Charter and Scorecard is to enable the empowerment and transformation of the tourism sector and to establish a 'commitment to working collectively to ensure that the opportunities and benefits of the tourism sector are extended to black South Africans' (The Charter, 1). The Charter recognises that global competitiveness is central to the success of BEE in the tourism sector.

    Provisions in the Charter include indicators and targets which endeavour to further the aims of BEE in the areas of:
  • ownership;
  • strategic representation;
  • employment equity;
  • skills development;
  • preferential procurement;
  • enterprise development; and
  • social development.

    Implementation and the Scorecard

    The Charter is monitored and implemented by the Tourism BEE Charter Council ('the Charter Council'), which reports directly to the Minister of Environmental Affairs and Tourism. The Charter Council facilitates and encourages participation in the Charter in both the private and public sectors.

    The Scorecard is used as a means of evaluating BEE progress and compliance in the tourism sector. Institutions are able to self-evaluate or appoint an external BEE verification agency to conduct an evaluation (Tourism BEE Charter Council Website, How do I become BEE Compliant?). Institutions will be given a rating each year in accordance with their Scorecard. Importantly, the Scorecard will be used 'by all spheres of Government in determining spending partners and for targeting investment and development funding through institutions like the IDC [Industrial Development Corporation] and Development Bank' (Department of Environmental Affairs and Tourism, Minister Launches Tourism BEE Charter).

    The scorecard includes indicator targets and scores under each BEE element. Targets include:
  • 21% share of economic benefits as reflected by direct and indirect shareholding by black people by 2009, and 35% by 2014;
  • 45% black people as percentage of supervisors, junior and skilled employees by 2009, and 65% by 2014;
  • 35% black people as percentage of management (including 18% black women) by 2009, and 50% by 2014 (including 25% black women); and
  • 40% expenditure on BEE compliant companies as a percentage of total procurement expenditure by 2009, and 50% by 2014.

  • Outcomes:
    In 2007 the Charter Council commissioned a baseline study to assess the transformation of the tourism sector against the targets provided for in the Charter and Scorecard (Tourism BEE Charter Council, State of Tourism Transformation Study).

    On 14 April 2007, Business Day reported the Minister of Environmental Affairs and Tourism stating that although large, listed companies had made progress, large and unlisted, medium and small companies were struggling to meet targets:

    'in the six provinces measured by the study, on average only 15.6% of 321 bed-and-breakfast operations the entry point into the industry for many entrepreneurs were owned by black operators. Of 90 hotels examined, only 4.4% were black owned or controlled. Black professional caterers comprised just over 1% of 23 establishments canvassed' (Parker 2007).

    However, a Business Report article on 18 April 2007 quoted the brand marketing director of Protea Hotels, Allan Duke, disagreeing with the Minister's comments, and highlighting that Protea, 'the largest hotel management company in Africa, was 54% black-owned' and employed several senior black managers (D'Angelo 2007).


    Related Entries

    Organisation
  • Tourism BEE (Black Economic Empowerment) Charter Council
  • Department of Environmental Affairs and Tourism (South Africa)
  • Legislation
  • Broad-Based Black Economic Empowerment Act, 2003 (South Africa)
  • Policy/Strategy
  • Black Economic Empowerment
  • Broad-Based Black Economic Empowerment Codes of Good Practice
  • Apartheid

  • References

    Media Release
    Department of Environmental Affairs and Tourism (South Africa) (8 May 2005) Minister Launches Tourism BEE Charter: Changing the Face of Tourism in SA
    Newspaper Article
    Janet Parker (18 April 2007) Tourism Bus Leaves Transformation Behind
    Audrey D'Angelo (18 April 2007) Change Crawls Despite Growth in Tourism
    Report
    Tourism BEE Charter Council (2008) State of Tourism Transformation Study
    Tourism BEE Charter Council (July 2006) Tourism BEE Charter Council Strategic Plan 2006-2009
    Resource
    Tourism BEE Charter Council (July 2006) Tourism BEE Charter Council Stakeholder Update, July 2006
    Department of Environmental Affairs and Tourism (South Africa) (8 May 2008) Tourism BEE Charter and Scorecard
    Tourism BEE Charter Council (2008) How Do I Become BEE Compliant?

    Glossary

    Policy/Strategy (South Africa)

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