At last, SABMiller (the parent company of SAB Ltd) is being recognised for its long-standing commitment to black economic empowerment (BEE). We use the term "SABMiller" for consistency, even though the activities of SAB Ltd are largely responsible for SABMiller's BEE performance. Since the late 1970s, when uplifting black people was frowned on by the apartheid government, SABMiller has been working tirelessly in this regard. Cynical observers might argue that it was doing so out of enlightened self-interest, but whatever the motives, the results speak for themselves.
The ownership score of 7,7% - second in the sector behind Distell - disguises what has taken place at SABMiller over the past 20 years. In 1989, for example, it listed its 65%-owned subsidiary, Amalgamated Beverage Industries (ABI) and in the process ensured that most of the shares in ABI were issued to previously disadvantaged people. It did a similar thing with formerly owned Lion Match, selling it off to Fasic, but its biggest single empowerment equity deal is its sale of 51% of Tsogo Sun, which was completed in 2003.
In terms of employment equity and management, there's still a lot to be done, especially at senior management level. SABMiller's fast-tracking management programme had 135 participants during 2004, of which about 70% were black.
SABMiller scores reasonably well on preferential procurement, though it's puzzling why the group didn't score better, considering the depth and longevity of its schemes in this regard.
It began an aggressive economic empowerment campaign during the 1980s in an effort to place a considerable portion of its business with black suppliers. By 2005, the group was spending almost R1bn on preferential procurement, or 17,3% of its total procurement spend.
But it is skills development where SABMiller really comes into its own, scoring 20% - way ahead of its peers in the sector. SABMiller spends 6,1% of its payroll, or R56m, on training, which exceeds international benchmarks; 60% of this was spent on training for black employees. This expenditure has increased by more than 15%/year during the past four years.
Every year, more than 7 000 delegates attend SAB's training institute at Kyalami in Gauteng.
SABMiller's enterprise development score of 0,6% seems ridiculously low, especially considering how long the company has been active in this field.
Its enterprise development initiatives include: the owner-driver scheme; the taverner training programme; Kickstart, which helps equip young adults with business skills and seed capital; the customised delivery service programme; and its barley farmers project.
Almost three-quarters of all liquor outlets in SA are unlicensed and hence, effectively, illegal. SABMiller is not able to distribute its products to these outlets, as doing so would put its licence to trade in jeopardy.
Slowly but surely, some of these illegal outlets (shebeens) are being converted into licensed establishments (taverns). It is in SABMiller's interest to promote this conversion because it will allow the company to distribute directly to taverns.
In association with the Services Seta, SABMiller has committed R24m to the taverner training programme this year. The plan is to help shebeen owners become legal.
Barley is not grown widely in Africa, as its uses are limited, largely, to the production of malt beer. Until the early 1990s, SABMiller sourced virtually all its barley requirements from its subsidiary in the Western Cape, SABMiller Maltsters. But the Cape's weather is notoriously unreliable, resulting in crop yields being unpredictable.
The development of barley farmers in the Taung area of the economically depressed Northern Cape is growing from strength to strength. During the past 15 years, the number of farmers in the region has increased from 55 to 178. The Taung project, under irrigation from the nearby Vaalharts scheme, complements barley farming in the climatically challenged Western Cape.
