presentation to portfolio committee on agriculture, forestry & fisheries embracing change 14...
TRANSCRIPT
Presentation to Portfolio Presentation to Portfolio Committee on Agriculture, Forestry Committee on Agriculture, Forestry
& Fisheries& Fisheries
Embracing ChangeEmbracing Change
14 June 201114 June 2011
Introducing the Oceana Group Limited (OGL) Oceana Group...
1. ...is the leading and only JSE-listed fishing company in South Africa.2. ...is an empowered Level 3 BEE contributor that supports the government’s growth and transformation objectives. 3....is a responsible and involved corporate citizen that operates in strict accordance with the laws of the country and embraces sustainable business practices.4....is a great company to work for with fair and equitable employment policies and a commitment to improving the well- being of its employees
OGL has been verified as a black-owned level 3 BBBEE contributorOGL has been verified as a black-owned level 3 BBBEE contributor
OGL has been verified as a black-owned level 3 BBBEE contributorOGL has been verified as a black-owned level 3 BBBEE contributor
BROAD-BASED NARROW-BASED
1. Measures underlying economic interest of black ownership
Measures percentage black ownership only not actual economic benefits; benefits only a few with access to capital – elitist
2. Eliminates fronting through clear definitions, principles and processes to define measurement
High level of fronting – no clear implementation guidelines/ measures
3. Broad-based empowerment encouraged through procurement , enterprise development and CSI , which, if channelled correctly, will have an increasingly positive impact on the welfare of fishing communities
No broad-based benefits for emerging businesses or fishing communities
4. Supports the New Growth Path initiative and government job creation targets
Does not support government policy
Key Challenge: Agreeing on a uniform measurement of Transformation
Broad-based:1.Ownership 2.Management & Control3.Employment Equity4.Skills Development5.Preferential Procurement6.Enterprise Development7.Socio-Economic Development
OGL has been verified as a black-owned level 3 BBBEE contributorOGL has been verified as a black-owned level 3 BBBEE contributor
“... the Council (Government BBBEE Advisory Council) called for the CONSISTENTCONSISTENT implementation of
broad-based BEE in ALL SECTORS ALL SECTORS of the economy, to ensure that the
policy touches the lives of more people," SA Presidency 1 April 2011
Key Challenge: Agreeing on a uniform measurement of Transformation
Narrow-based:1.Ownership2.Management & Control
“To define BEE too narrowly limits it to a set of
transactions TRANSFERRING TRANSFERRING CORPORATE ASSETS FROM CORPORATE ASSETS FROM
WHITE TO BLACK WHITE TO BLACK ownership” – Dept. of Trade and Industry’s
BEE Strategy doc.
OGL has been verified as a black-owned level 3 BBBEE contributorOGL has been verified as a black-owned level 3 BBBEE contributor
Key Challenge: Agreeing on a uniform measurement of Transformation
Current Status of Transformation of the Fishing IndustryStatus currently known by DAFF Resolve Group appointed to conduct a detailed Performance Review across all sectors of the industry in 2010 All rights holders had to submit a completed electronic Request for Information (“RFI”) questionnaire by 30 April ’10 Results not released yet
OGL has been verified as a black-owned level 3 BBBEE contributorOGL has been verified as a black-owned level 3 BBBEE contributor
Transformation in Oceana Group in 2005
At the end of 2005, long-term fishing rights were allocated for varying periods of between 8 and 15 years...
OGL has been verified as a black-owned level 3 BBBEE contributorOGL has been verified as a black-owned level 3 BBBEE contributor
There may have been an expectation that with our rights in place, we would simply have maintained our transformation status and done nothing more...
Transformation in Oceana Group after allocation of long-term fishing rights
OGL has been verified as a black-owned level 3 BBBEE contributorOGL has been verified as a black-owned level 3 BBBEE contributor
Instead, we’ve accelerated transformation
since long-term rights were allocated.
OGL has been verified as a black-owned level 3 BBBEE contributorOGL has been verified as a black-owned level 3 BBBEE contributor
Transformation in Oceana Group after allocation of long-term fishing rights
How has Oceana Transformed?
Black Ownership - %
1995 2005 Current
25,1% 19,6% 50,5%*
OGL has been verified as a black-owned level 3 BBBEE contributorOGL has been verified as a black-owned level 3 BBBEE contributor
OCEANA GROUP IS NOW A OCEANA GROUP IS NOW A BLACK-OWNED COMPANYBLACK-OWNED COMPANY
*Independently verified by Empowerdex
How has Oceana Transformed?
Profile of Major Shareholders
OGL has been verified as a black-owned level 3 BBBEE contributorOGL has been verified as a black-owned level 3 BBBEE contributor
OGL Shareholder No of shares held % of total shareholding
No of individual black beneficiaries
Khula Trust 14,162,799 11,9% 2,003
Brimstone 11,596,755 9,7% 8,500,181
Tiger Brands 44,699,463 37,5% 10,951
Other 48,690,540 40,9% n/a
Totals 119,149,557 100,0% 8,513,135
How has Oceana Transformed?
Black Management & Control - % (Board of Directors)
1995 2005 2010
12,5% 40,0% 45,0%
% Black Females
0,0% 0,0% 18,0%*
OGL has been verified as a black-owned level 3 BBBEE contributorOGL has been verified as a black-owned level 3 BBBEE contributor
*Currently, 27,3%
How has Oceana Transformed?
Employment Equity - % (black representation)
2005 2010
Senior Management 10,0% 26,0%Middle Management 38,0% 50,0%Junior Management 75,0% 82,0%
OGL has been verified as a black-owned level 3 BBBEE contributorOGL has been verified as a black-owned level 3 BBBEE contributor
How has Oceana Transformed?
Skills Development Spend
2006 2010 5yr Cumulative
Rand value: all staff R4,1m R7,8m R26,3mRand value: black staff R3,6m R6,4m R22,0m% of training spend: 87,8% 82,1% 83,7%black staff
OGL has been verified as a black-owned level 3 BBBEE contributorOGL has been verified as a black-owned level 3 BBBEE contributor
How has Oceana Transformed?
Procurement spend on BEE companies
2006 2010 5yr Cumulative
Rand value R536,1m R827,2m R3,1b% Spend 65,81% 70,3% 62%
OGL has been verified as a black-owned level 3 BBBEE contributorOGL has been verified as a black-owned level 3 BBBEE contributor
How has Oceana Transformed?
Enterprise Development Spend
2006 2010 5yr Cumulative
Rand value R79,4m R27,3m R207,6mJoint ventures 22 25 n/a
Supply agreements 103 72 n/a
OGL has been verified as a black-owned level 3 BBBEE contributorOGL has been verified as a black-owned level 3 BBBEE contributor
How has Oceana Transformed?
CSI Spend
2006 2010 5 yr Cumulative
Total CSI R3,3m R2,4m R13,4m(SA only)
OGL has been verified as a black-owned level 3 BBBEE contributorOGL has been verified as a black-owned level 3 BBBEE contributor
Further Empowerment Initiatives An important provider of food security in South Africa and Africa (protein footprint)
535,000 cans of canned fish consumed every day of the year, which
equates to an estimated 1,9 million servings per day in SA; An estimated 1,4 million servings of horse mackerel per day in Africa Main target market is consumers in the lower Living Standards Measure (LSM) bracket
OGL has been verified as a black-owned level 3 BBBEE contributorOGL has been verified as a black-owned level 3 BBBEE contributor
An important provider of food security in SA(protein footprint) Employee Share Scheme
Khula Trust, formed in 2006, owns 14,2m shares in the Oceana Group equating to 11,9% of the shareholding At current share price, the Accrued Capital Value to employees net of
debt equals R343m Total current employee beneficiaries is 2,003 Average accrued capital value per employee equals R171,000
OGL has been verified as a black-owned level 3 BBBEE contributorOGL has been verified as a black-owned level 3 BBBEE contributor
Further Empowerment Initiatives
An important provider of food security in SA (protein footprint) Employee Share Scheme Provision of housing to employees at a cost of R6m
Lamberts Bay 30 houses
Hout Bay 58 cottages and 24 flats
St Helena Bay / Laingville 45 plots 50 houses
OGL has been verified as a black-owned level 3 BBBEE contributorOGL has been verified as a black-owned level 3 BBBEE contributor
Further Empowerment Initiatives
Food safety (protein footprint) Employee Share Scheme Provision of housing Investment made in respect of “South Africanisation” of Russian vessel, the Desert Diamond
R3,372,924 for training and development SA crew increased from 32% in 2003 to 66% in 2011.
OGL has been verified as a black-owned level 3 BBBEE contributorOGL has been verified as a black-owned level 3 BBBEE contributor
Further Empowerment Initiatives
Transformation of the Oceana Group
BBBEE Scorecard Maximum Score
Actual Score
Ownership 20,00 20,00
Management & Control 10,00 6,55
Employment Equity 15,00 8,06
Skills Development 15,00 10,14
Preferential Procurement 20,00 18,56
Enterprise Development 15,00 15,00
Socio-economic Development
5,00 5,00
TOTAL 100,00 83,31
OGL has been verified as a black-owned level 3 BBBEE contributorOGL has been verified as a black-owned level 3 BBBEE contributor
Oceana Group is now ...a black-owned Level 3 BBBEE Contributor
The Way ForwardWe would respectfully ask of DAFF, as a precursor to the development of a fishing charter and the setting of any future industry-specific transformation goals, that it:
1.Adopts the BBBEE Codes of Good Practice in ALL policies DAFF’s current approach to assessing transformation -
Is narrow and only measures the percentage black ownership and management and fails to recognise broad-based transformation initiatives
Pre-dates the 2007 change in legislation on B-BBEE Is contrary to government’s stated strategy, including the New Growth Path
2. Publishes the results of the Performance Review process specific to the CURRENT LEVEL OF BBBEE TRANSFORMATION within the fishing industry
OGL has been verified as a black-owned level 3 BBBEE contributorOGL has been verified as a black-owned level 3 BBBEE contributor
Thank You!Thank You!