Small Business Development

Understanding Engen's SME & Black Empowerment Policy

Engen is an African company. It regards the implementation of black economic empowerment in South Africa and in all levels of the company as crucial not only to its financial prosperity, but also to its particular identity as a company which is rooted in and representative of the continent.

We at Engen believe that without economic liberty, political liberty represents a shadow of what it was designed to achieve. Engen's black economic empowerment philosophy is both business and value based and not driven by legal imperatives. It is our belief that substantial investment in our people and those of the continent will ensure sustainable growth in the future.

Engen's policy is centred on capacity building, training, development and partnerships, and is defined to include African, Asian and Coloured communities, giving additional focus to addressing the gender mix and the disabled in the workplace.

At the same time, Engen does not exclude traditional players in the market, but instead gives preference to those companies and individuals who have demonstrated a commitment to the principle of black economic empowerment.

How does this affect people doing business with Engen?

Engen centres its policies internally and then extends them to its various stakeholders. This means that the company's policy is firstly on its employees and shareholders, spreading outwards to its dealer network, which together with the commercial sales teams represent the frontline of Engen's retail business, to those who supply the company with goods and services.

There are five main areas of focus within Engen's policy:

• Equity participation - with focus on seeking value added partnerships and making the shareholder base representative
• Employees - with focus on affirmative capacity building, training and development
• Dealers - with focus on training, entrepreneurship and broadening the dealer mix
• Business Partners - with focus on value creating opportunities
• The wider community - with focus on co-operative relationships based on mutual understanding of needs.

Suppliers

In its procurement, outsourcing and contract awarding activities, Engen favours those companies who have demonstrated a tangible and deliverable commitment to black empowerment principles.

Definition of a BEE Business

Engen defines a Black Economic Empowerment business as a business in which at least 50% +1
shareholding and controlling interest of the equity is owned by HDSAs.

Shareholders must take an active part in the operations of the business and that there must be a
deliberate effort to transfer skills to the HDSA employees over an agreed period.

Engen gives preference to Small, Medium and Micro Enterprises in recognition of the crucial
contribution they make to our economy.

Businesses with a smaller BEE/HDSA equity shareholding will receive recognition for their commitment
to transformation but preference will be given to those with the greater BEE/HDSA equity ownership. The following definitions are considered;

• A Black Company is one where 50% +1 share of the equity is held by HDSAs
• A Black Empowered Company is one where the HDSA equity held is between >25% and < 50%.
• A Black Influenced Company is one where the HDSA equity held is between >10% and < 25%.
• An Engendered Company is a company where women represent 30%+ of the equity held when the company meets one of the above definitions.

The Company reserves the right to request any information from the BEEs to confirm the equity
ownership and the involvement of shareholders.

This particular area of focus is divided into two important components: the companies who supply Engen with goods and services and those companies with whom Engen has joint agreements or partnerships to operate certain contracts. The company believes that this policy will help in contributing to job creation and economic growth.

Within its supplier base, Engen concentrates its efforts on contracting with small, medium enterprises, or SMEs, with the focus again on those which are black owned. In some cases, Engen facilitates the creation of such SMEs for whom it is in turn their first customer. In most instances, the company also provides assistance in developing business and technical skills so that once these SMEs have gained the necessary experience in business relationships of this sort, they are in a better position to offer their products and services on the open market. 

In order to focus directly on creating as many opportunities as it can for small business, Engen has created its own dedicated Black Economic Empowerment Unit, a unit which concentrates purely on assisting BEE businesses to position their products and services to meet standards of excellence and service in an accessible format. This partnership allows entrepreneurs the opportunity to supply quality goods and services to the company and grow their own businesses.

The goals of this unit include:

• Awarding meaningful purchasing and service requirements to BEEs/SMEs
• Co-operating with other large businesses that share Engen's objectives and commitment to BEEs/SMEs
• Awarding non-core activities, identified for outsourcing, on a preferential basis to BEEs/SMEs.