AMENDED BROAD -BASED BLACK ECONOMIC …

1 AMENDED BROAD - based BLACK ECONOMIC empowerment CODES OF GOOD PRACTICE OCTOBER 20122 CONSTITUTIONAL MANDATES ection 9 of the Bill of Rights Equality includes the full and equal enjoyment of all rights and freedoms. To promote the achievement of equality, legislative and other measures designed to protect or advance persons or categories of persons disadvantaged by unfair discrimination maybe taken B-BBEE IMPLEMENTATION FRAMEWORK3 BROAD -BASED BEES trategy 2003( Strategic Framework) BROAD -BASED BEE ActNo. 53 of 2003 Codes of GoodPractice 2007 B-BBEE Amendment Bill 2012 AMENDED B-BBEE Codes 2012 BEE CommissionReport 1998eBROAD based POLICY OBJECTIVES DirectEmpowermentBlack OwnershipManagement ControlEmployment EquityHumanResourcesEmpowermentSkills DevelopmentIndirectEmpowermentPreferenti al ProcurementEnterprise DevelopmentSocio ECONOMIC Development2007 BASELINE STUDY5 LEVEL 1 - OWNERSHIPLEVEL 2 - MANAGEMENT CONTROLLEVEL 3 - EMPLOYMENT EQUITYLEVEL 4 - SKILLS DEVELOPMENTLEVEL 5 - PREFERENTIAL PROCUREMENTLEVEL 6 - ENTERPRISE DEVELOPMENTLEVEL 7 - SOCIO- ECONOMIC Compliance (>=100%)Partial Compliance (>0 <100%)No Compliance (0%)Source: Consulta Research6 PROGRESS SINCE 20077 Data Source.

2 Empowerdex8 STATE OF INEQUALITYUSHERING IN A NEW ERA OF empowerment 9B-BBEENGPI nitiative ASGI-SANIPFIPAPCSDPNIPPS kills DevelopmentDEVELOPMENTAL OBJECTIVES Job creationLocalisationIndustrialisationSup plier Development10 TheGenericscorecardadjustedinaccordancew ithgovernmentkeypriorities 5 Scorecardelements, AllcompaniesexceptExemptedMicroEnterpris estocomplywithallelements Scorecardpoints&Qualificationcriteriafor awardingofB-BBEE statuslevelsadjusted Enhancedtherecognitionstatusofblackowned EMEsandQSEsAMENDED GENERIC PRINCIPLES 11 EmploymentEquityandManagementControlmerg edintooneelement:ManagementControl( MC) PreferentialProcurementandEnterpriseDeve lopmentmergedintooneelement:Enterprisean dSupplierDevelopment(ESD) Introducedminimumrequirementsforpriority elements: Ownership,SkillsDevelopment,andEnterpris eandSupplierDevelopment12 Allmeasuredentitiestocomplywithprioritye lementsunderthefollowingconditions: QSEstocomplywithatleasttwooftheprioritye lements Ownershipis compulsoryandeither ESDorSkillsDevelopment; Largeentitiestocomplywithallpriorityelem ents; Entitieswhodonotmeetthethresholdsinprior ityelements,theoverallScorewillbediscoun tedasfollows: Largeentitiesscore:two(2)levelsdown QSEscore:one(1)leveldown13 AnEMEthatis100%ownedbyblackpeoplequalifi esasalevel1contributor; AnEMEthatis morethan50%ownedbyblackpeoplequalifiesas a level2 contributor; EarlypaymentisapplicabletoExemptedMicroE nterprisesandQSEsthataremorethan50% BLACK owned.

3 Maximumpointsthatcanbescoredis15%of15poi ntsunderEnterprise&supplierdevelopment14 ThethresholdsforExemptedMicroEnterprises andQualifyingSmallEnterpriseshavebeenadj ustedasfollows: EMEincreasedfromR5 milliontoR10million QSE:R5 million-R35milliontoR10million- R50million Largeentities:R50millionandabove15 SIZE OF THECOMPANY NO%BEEcompliance Survivalists,MicroandVerySmall( EME s)878 03295 %Nocompliance QSE(R10mtoR 50m)34 1183%Relaxed compliance Large( MorethanR 50m)11 8712%FullCompliance ECONOMIC IMPACT of THE THRESHOLDS SOURCE: SARS 2012 Above companies include only current active filers/ economically active companies totaling 924 021 Up to 95% of all economically active companies have been exempted from B-BBEE compliance Companies that are expected to comply with the generic scorecard represents 2% of all active fillers.

4 16 ElementCode series Revised WeightingOwnership10025 pointsManagementControl(MC)20015 pointsSkillsDevelopment(SD)30020 pointsEnterprise&SupplierDevelopment(ESD )40040 pointsSocio-economicdevelopment(SED)5005 pointsTOTAL105 POINTSREVISED SCORECARD17B-BBEE StatusCurrent QualificationNew QualificationB-BBEE recognition levelLevelOneContributor 100pointsontheGenericScorecard 100pointsontheGenericScorecard135%LevelT woContributor 85 but <100 points on the Generic Scorecard 95 but <100 points on the Generic Scorecard125%LevelThreeContributor 75but<85ontheGenericScorecard 90but<95ontheGenericScorecard110%LevelFo urContributor 65but<75ontheGenericScorecard 80but<90ontheGenericScorecard100%LevelFi veContributor 55but<65ontheGenericScorecard 75but<80ontheGenericScorecard80%LevelSix Contributor 45but<55ontheGenericScorecard 70but<75ontheGenericScorecard60%LevelSev enContributor 40but<45ontheGenericScorecard 55but<70ontheGenericScorecard50%LevelEig htContributor

5 30but<40ontheGenericScorecard 40but<55ontheGenericScorecard10%Non-Comp liantContributor<30ontheGenericScorecard <40ontheGenericScorecard0%REVISED B-BBEE RECOGNITION LEVELS ownership1819 IncreasedtheweightingoftheOwnershipscore cardfrom20to25points Newentrantshavebeenincorporatedintothema inpointsoftheOwnershipScorecardandincrea sedfromR20milliontoR50million Anentitymustachievea thresholdof40%onNetValueannualtargetstoa voiddiscountingofitsoverallscore Ifthethresholdisnotachievedtheentitywill stillscorewhateveractualpointsit achievedonownershipBUTtheoverallscorewil lbediscounted Consolidatedownershipfulfilmentandnetval uepoints EnhancedthePrivateEquityprovisions20 BEE ElementIndicatorDescriptionWeighting PointsCompliance TargetOwnershipVoting RightsEconomic InterestExercisable Voting Rightsin the Enterprise in the hands of BLACK people425%+ 1 VoteExercisableVoting Rights in the Enterprise in the hands of BLACK women210% ECONOMIC Interestin the Enterprise to which BLACK people are entitled425% ECONOMIC Interest in the Enterprise to which BLACK women are entitled210%OWNERSHIP SCORECARD21 Ownership ScorecardBEE ElementIndicatorDescriptionWeighting PointsCompliance TargetEconomic Interest inthe hands the following Designated Groups in the enterpriseOwnershipEconomic Interest- BLACK designated groups;33%2%- BLACK participants in employee share ownership plans (ESOP);- BLACK beneficiaries of BROAD based ownership schemes.

6 - BLACK participants in New Entrants2 Realisation Points- Net Value8 Total Score25 OWNERSHIPMANAGEMENT CONTROL23 Source: 2012 Employment Equity Commission Report MANAGEMENT CONTROL24 ThemergedManagementControlincludesSenior ManagementandMiddleManagementfromtheEmpl oymentEquityelement ThecompliancetargetsforManagementControl werealignedtotheCommissionforEmploymentE quityreport Juniorlevelcategorytakenout25 MANAGEMENT CONTROLM easurement Category & CriteriaWeighting pointsCompliance board rights of BLACK members as a percentageof all board members250% Exercisablevoting rights of BLACK female board members as a percentageof all board members125% Exercisablevoting rights of Executive BLACK Members of the board as a percentage of all such employees250% Exercisablevoting rights of Executive BLACK female Members of the board as a percentage of all such employees125% Top Top

7 Management as a percentage of all such employees250% BLACK female Top Management as a percentage of all such employees125% Senior employees in Senior Management as a percentage of all such employees160% BLACK female employees in Senior Management as a percentage of all such employees130%26 Measurement Category & CriteriaWeighting pointsCompliance BLACK employees in professionally qualified and experienced specialists and mid-management as a percentage of all such employees175% BLACK female employees in professionally qualified and experienced specialists and mid-management as a percentage of all such employees138% Disabled Disabled Employees as a percentage of all employees22%MANAGEMENT CONTROLSKILLS DEVELOPMENT28 Broadenedthelearnershipsub-elementtoincl udeapprenticeshipsandinternships Revisedthelearnershipmatrixtoonlygiverec ognitionfortargetedtraining Traininginitiativesbroadenedtoencompasst heunemployed(outwardfocused)

8 Introducedlearnersabsorptiontarget CompliancetargetsarebasedonEconomicallyA ctivePopulationdemographicrepresentation ofblackpeopleasdefined Introduceda 40%thresholdasa requirement Ifthethresholdisnotachievedtheentitywill stillscorewhateveractualpointsitachieved onSkillsBUTtheoverallscorewillbediscount ed29 SKILLS DEVELOPMEMTC riteriaWeighting pointsCompliance Skills Development Expenditure on any program specified in the Learning Programme Matrix for BLACK people as a percentage of Leviable Amount Development Expenditure on Learning Programmes specified in the Learning Programme Matrix for BLACK people as a percentage of Leviable Amount 86% Skills Development Expenditure on Learning Programmes specified in the Learning Programme Matrix for BLACK people with disabilities as a percentage of Leviable Amount Learnerships, Apprenticeships and of BLACK people participating in Learnerships, Apprenticeships and Internships as a percentage of total employees Number of unemployed BLACK people participating in Learnerships, Apprenticeships and Internships as a percentage of total employees DEVELOPMEMTC riteriaWeighting pointsCompliance of blackpeopleabsorbed by the industry at the end of the learnership programme5100%ENTERPRISE AND SUPPLIER DEVELOPMENT(ESD)32 PreferentialProcurementandEnterpriseDeve lopmentweremerged TheweightingPOINTS setat40 Introduceda 40%minimumcompliancetargetasa requirement(.)

9 Increasedtargetsfor> 50%blackownedcompaniesand>30%blackwomeno wnedcompaniesto40%and12%respectivelyESD ELEMENT33 Enhancedrecognitionforprocurementfromnew enterprises,andprocurementfromblackQSEsa ndEMEsfora 3 yearperiod Reducedtheweightingforallsuppliersbasedo ntheB-BBEE procurementrecognitionlevelsasnon-compli antcontributorsalsobenefited Expandedthescorecardtodistinguishbetween enterprisedevelopmentcontributionsandsup plierdevelopmentcontributions GeneralPrinciplessectiontooutlinealignme ntbetweenenterpriseandsupplierdevelopmen tinitiativeswiththesupplychainsofMeasure dEntitiesandbroadergovernmentobjectivesE SD ELEMENT34 Provideda listofqualifyingmonetaryandnon-monetaryc ontributions RedefinedSupplierDevelopmentbeneficiarie stoonlyincludeblackownedandblackwomenown edQSEsandEMEs Adjustedthebenefitfactormatrixandlimited therecognisableamountforshorterpaymentpe riodstothecostofacquiringshorttermfundin g

10 Allsuppliersarerequiredtobevalue-addings upplierstobeawardedpointsonthescorecardE SD ELEMENT35 CriteriaWeighting pointsCompliance B-BBEE Procurement Spend from all Value-Adding Suppliers based on the B-BBEE Procurement Recognition Levels as a percentage of Total Measured Procurement Spend880% Procurement Spend from Value-Adding Suppliers who are Qualifying Small Enterprises or Exempted Micro-Enterprises based on the applicable B-BBEE Procurement Recognition Levels as a percentage of Total Measured Procurement Spend430% Procurement Spend from Value-Adding suppliers that are 50% BLACK owned940% Procurement Spend from Value-Adding suppliers that are 30% BLACK women-owned412% Enterpriseand Supplier value of all Supplier Development Contributions made by the Measured Entity as a percentage of the of value of Enterprise Development Contributions and Sector Specific Programmes made by the Measured Entity as a percentage of the of NPATESD SCORECARD36 ESD SCORECARDC riteriaWeighting pointsCompliance Bonus points for the following ( during the measured period) New venture creation ( to become a value-adding supplier) Graduation from ED to SD Jobs created by under and 1 SOCIO- ECONOMIC DEVELOPMENT38 SOCIO- ECONOMIC DEVELOPMENT Initiativesthataregenericandsectorspecif icthatfacilitateincomegeneratingactiviti esfortargetedbeneficiaries Programmethatcreatessustainableaccesstot heeconomyforitsbeneficiaries.