Broad-based black economic empowerment (BEE)

Broad-based black economic empowerment (BEE) has been a central part of government's economic transformation strategy for a number of years and is likely to remain for many years to come. The main purpose of BEE is to increase the number black people that manage, own and control the country's economy and as a result, to reduce income inequalities and to contribute to economic transformation in South Africa.

The legislation supporting the BEE strategy is the Broad-Based Black Economic Empowerment Act no 53 of 2003 ("the BEE Act"). Implementation of this legislation occurs in terms of the Codes of Good Practice on Broad-Based Black Economic Empowerment. The Codes establish a "scorecard" system for evaluating an entity's BEE status.

Proto Signs CC ("PROTO") is a Qualifying Small Enterprise ("QSE") as defined by the Codes of the Broad Based Black Economic Empowerment Act. In accordance with the Codes, PROTO is only required to comply with four of the seven elements of the QSE scorecard.

PROTO has chosen the following four elements of the QSE scorecard; and in 2009 and 2010 appointed BEE-Matrix, an independent verification agency, duly verified in accordance with the South African National Accreditation System (SANAS) to assess PROTO's BEE status:

Ownership - employment equity (code 800, statement 803)

PROTO employs in excess of 70% black employees, as a percentage of all employees. Approximately 30% of which are black females. The company also has 5% black ownership. PROTO will continue its employment drive with a view to affording opportunities to the previously disadvantaged members of our countries population.

Preferential procurement (code 800, statement 805)

To assist in the development of BEE suppliers, PROTO monitors and encourages the number of BEE suppliers it has in the Company. In each financial year, the company endeavours to reach a target of approximately 60% of the company's procurement qualified as BBE Procurement Spend as a percentage of Total Measured Procurement Spend. PROTO aims to increase this percentage in the coming years.

Enterprise development (code 800, statement 806)

PROTO is committed to allocating funds to Enterprise Development.

Due to the fact that its BEE policy is still at an early stage, PROTO secured the services of B-BBEE Enterprise and Social Economic Development Specialists - Transvelop (Pty) Ltd (and their subsidiary SED Alliance).

PROTO have through Transvelop (Pty) Ltd, entered into an Enterprise Development Agreement whereby they have made an enterprise development grant contribution to SED Alliance whom have allocated the funds to TD & HP Building Construction CC.

The contribution amounted to a non-recoverable Qualifying Contribution made by PROTO to TD & HP Building Construction CC which is set out in an Enterprise Development Agreement between the parties.

PROTO will, in the future, look to source further enterprises qualifying for this funding.

Socio economic development (code 800, statement 807)

PROTO is furthermore committed to making annual socio-economic contributions. PROTO annually contribute to the Johannesburg Child Welfare Society.

The Johannesburg Child Welfare Society has been at the forefront of providing direct services to children, families and communities in distress since 1909. Last financial year, they reached over 18,000 underprivileged children, families and communities through a team of dedicated and highly qualified professionals who extended vital care and support to those in need.

PROTO specifically requested that their funding be allocated to the Othandweni Children's Home in Alexandra.

Telephone:	+27 (0) 11 440 7221 or 7225	Email:	sales@protosigns.co.za
Fax:	+27 (0) 11 440 7313	Address:	26 Thora Crescent, Wynberg, Sandton, Johannesburg
Fax-to-Email:	086 697 2987 or 086 652 0259	PO Box:	542 Bruma, Johannesburg, 2026