Woolworths BEE policies and strategies are developed to ensure that measurable progress is made towards genuine black economic empowerment.
The approach to BEE
Woolworths approach is broad-based and holistic and aims to embed BEE as a way of working across all areas of activity. The approach is collaborative and the business works together with franchise partners, suppliers and the public sector, including government.
Specific BEE initiatives
Woolworths Good business journey sets out a plan of action for the next five years. These are the BEE priorities identified as part of this journey:
- To become a level 4 BEE contributor (according to dti codes)
- To advance equity ownership
- To make preferential procurement a priority – Woolworths is committed to BEE supplier partners providing core product for Woolworths over time
- To support enterprise development and to work with potential BEE suppliers to help their businesses grow
- To accelerate the development of core retail skills through focused training initiatives. This includes the accreditation of Woolworths courses and the establishment of provincial Woolworths learning centres
- To meet employment equity targets and, where there is a skills shortage at senior leadership level, create a skills pipeline to provide the necessary momentum for change.
Supporting South African business first
Woolworths is a passionately South African business and it is committed to buying as much as possible from local suppliers. Where we are unable to offer customers the right level of quality, value and technological innovation from local suppliers, Woolworths will look to other countries. As part of the Good business journey and in line with the broad-based approach to BEE, Woolworths undertakes to:
- Grow its Southern African supply base to ensure we retain the majority of our clothing sourcing in South Africa
- Maintain strong local and regional food sources.
BEE employee share ownership scheme
A key element of the Good business journey is to accelerate the process of transformation within Woolworths. As Woolworths is a business which is growing fast, employees are major contributors to that growth. Bringing all of them into the financial benefits of this growth is an important step and part of a range of transformation initiatives. This broad – based black empowerment transaction gives all employees an equity interest in the company.
The staff BEE share ownership scheme, announced on 21 May 2007, vests a 10% shareholding in Woolworths to approximately 17 000 employees (of whom 90% are black and 85% are women). All broad-based employees (ie. non-management) will receive a significant financial benefit at the end of the scheme, in addition to dividends throughout the life of the scheme.
The shares will be held in an Employee Share Ownership (ESOS) Trust for the duration of the scheme, and will have voting and dividend rights. The scheme will be open to all employees who were employed as at 1 May 2007, and who are still employed at the initial vesting date ( 30 June 2007), with the exception of white managers and white executives who already participate in an existing Woolworths share ownership scheme. Shares will be allocated on the basis of both length of service and seniority. It is envisaged that the ESOS Trust will own the ESOS shares for a period of eight years, and will distribute dividends to the beneficiaries accordingly (Woolworths pays dividends twice each year).
Eligible Woolworths employees have contributed to the group’s progress thus far and will continue to be important in driving the future growth of the group. They have a sound knowledge of the operations, and are best positioned to participate and add value from the commencement of the BEE transaction. Furthermore, the BEE transaction aligns the objectives of the ordinary shareholders with those of the eligible Woolworths employees, whose efforts have been the origin of the value created over the past years.
The scheme was approved by shareholders at a general meeting held on 12 June 2007.
Delivery and measurement
The dti’s broad-based BEE scorecard provides a legislated framework and guide for tracking BEE progress and this is used as a management tool for quarterly measurement and reporting.
Woolworths BEE strategy is part of, and in line with Woolworths sustainability strategy section in the Woolworths sustainability report . You will find a detailed account of Woolworths position with respect to BEE in the sustainability report. Separate business units have been given responsibility for driving delivery of BEE against agreed targets and will make business decisions informed by BEE requirements.
Broad-based black economic empowerment certificate of compliance
Click here to view Woolworths BEE certificate.