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Transformation

Transformation and broad-based black economic empowerment (BBBEE) are critical in creating a sustainable business in South Africa. BEE has been incorporated into the Cadiz business strategy and is managed across all elements of the empowerment scorecard outlined in the Codes of Good Practice of the Department of Trade and Industry (dti).

Empowerdex, the economic empowerment rating agency, awarded Cadiz an ‘A’ rating in its assessment completed in December 2007, with level four broad-based BEE contributor status. Cadiz has achieved an A rating in its updated BEE scorecard for the period to March 2008, incorporating developments on ownership, management and control and employment equity which is posted on the dti website under URN: BEE 9916678. This is currently subject to external verification by Empowerdex.

A summary of the group’s progress on transformation includes the following:

Ownership

  • Broad-based black empowerment group Makana Investment Corporation (which is owned and controlled by the Makana Trust, an organisation established at the behest of Nelson Mandela to cater for the needs of former Robben Island prisoners and their dependants) holds a 9.6% equity stake in Cadiz Holdings and is a long-term, strategic partner of the group
  • In August 2008 Cadiz launched the Cadiz Black Employee Share Ownership Scheme (CBESOS) empowering black employees to take up ownership in Cadiz which set aside 24 million shares (10%) to be issued over the next three years.
  • Effective black shareholding of 27.71% in terms of the Codes of Good Practice, of which Makana forms an effective 14.12% and black employees 5.12%.

Management and control

  • 38% of management are black
  • 7.6% of management are female
  • 25% of the directors are black
  • Black female representation on the board is 12.5%

Employment equity

  • Black employees comprise 47.5% and females 43.7% of total employees
  • 53.3% of new appointments during the period were black and 46.7% (female)
  • 44% of management appointments during the period were black

Skills development

  • Skills development accounted for 1.38% of total payroll costs for the period
  • 50.98 % of attendees on courses were black

Preferential procurement

  • Procurement policy supports black-owned businesses, particularly black SME’s, and influences suppliers to transform their businesses where appropriate
  • Procurement from black suppliers accounted for 48.2% of total discretionary expenditure.

Enterprise development

  • More than R29 million preferred rate funding has been provided to qualifying black enterprises
  • Partnerships and joint ventures have been formed with small, medium and micro black enterprises to assist with development, facilitate skills transfer and provide support.

Socio-economic development

  • Committed to invest a minimum of 1% of profit after tax in CSI annually
  • The company donated R700 000 to the Cadiz Foundation, of which R360 000 were invested in CSI projects during the year under review. A list of the projects supported can be found in the CORPORATE SOCIAL INVESTMENT section of this report.