ICT Empowerment Charter

1. ICT Empowerment Charter Indaba 2 14th May 2004 ICT Charter Indaba

2. 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 ICT Charter Indaba

3. 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 ICT Charter Indaba

4. 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 ICT Charter Indaba

5. 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…………. ICT Charter Indaba

6. 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. ICT Charter Indaba

7. ICT Charter Indaba

8. 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 ICT Charter Indaba

9. 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 women’s skills ICT Charter Indaba

10. ICT Charter Indaba

11. Typical Recommendations:5.4 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 ICT Charter Indaba

12. ICT Charter Indaba

13. Typical Recommendations:5.5 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. ICT Charter Indaba

14. ICT Charter Indaba

15. Typical Recommendations:5.6 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….. ICT Charter Indaba

16. Typical Recommendations:5.6 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 ICT Charter Indaba

17. ICT Charter Indaba

18. Typical Recommendations:5.7 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 ICT Charter Indaba

19. ICT Charter Indaba

20. 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 ICT Charter Indaba

21. 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. ICT Charter Indaba

22. 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. ICT Charter Indaba

23. Hamba Digital Divide! Woza Transformation! ICT Charter Indaba

24. Contact Information URL: www.ictcharter.org.za Email: research@ictcharter.org.za Telephone: (011) 785 2220 Fax: (011) 785 1401 ICT Charter Indaba

25. ICT Empowerment Charter Indaba 2 14th May 2004 ICT Charter Indaba