Sister companies AESSEAL and AESPUMP continue to expand their apprenticeship programmes to ensure retention of Level 5 BEE certification (revised codes) recently re-assessed upwards from Level 6. The companies are committed to reaching Level 4 accreditation by 2019.

Together, AESSEAL and AESPUMP employ 140 people, 5% of whom comprise of active apprentices all undergoing training at Dinyane Education/HMD in Secunda and ArcelorMittal in Sasolburg. Upon completion of the two-year course, AESSEAL’s mentorship programme ensures a regular stream of qualified fitters and turners.

The AES management group already believe that the programme has and continues to return on their investment. All returns are re-invested with an annual intake of between three and five apprentices.

Craig Murray, AES’s general manager and company secretary, believes that “the training of apprentices and their integration into the Group’s workforce will prove to be the ultimate manner in which to grow South Africa’s skills base. At the same time, it will help companies meet the government’s revised black economic empowerment targets where emphasis has been taken away from simple BEE compliance and is now geared toward BEE strategy and true company empowerment.”

Our highly-rated apprenticeship programme has been at the heart of our recent upgrade to Level 5 accreditation, but we want to expand it further because we believe that this emphasis on skills development over time will lead to a self-correction of the key pillar of black ownership.

Murray feels that although the new codes require more work, they are more progressive because they will encourage companies to make proper, long-lasting changes that will of course benefit the company and South Africa in the long term.

Murray also suggests that “dramatic changes to the enterprise and supplier development criteria will lead to every large enterprise applying individual and carefully considered strategies to each and every key supplier. This means that we will ourselves be under scrutiny by our key customers, and it is, therefore, our intention to comply with our utmost ability. It is inevitable that the BEE portion of any tender will carry considerably more weight under the new codes.”

Following the new codes, only five points are given for spending as much as 80% of procurement spend with suppliers who hold a BEE certificate. This is in serious contrast to the old codes which offered 12 points for a 70% procurement spend with BEE certified suppliers.

Accordingly, Murray explains that “new suppliers need to be identified with more points to be won by broadening the base and procuring a greater proportion of one’s spend from black-owned qualifying small enterprises, or from exempt micro-enterprises.”

Murray goes on to warn that, “one cannot simply carry on with a business-as-usual approach. Among other initiatives, a revised procurement strategy is needed if a company is to avoid dropping up to three levels on the scale by doing nothing.”

Furthermore, Murray does admit that the enterprise and supplier development will be a challenge for AES. For any local company importing a finished, custom-engineered product, the capability of local production will be difficult, but not impossible.

Murray states that, “the AES Group’s own target compliance will be helped by the ongoing sponsorship, via bursaries, of black undergraduates studying towards their bachelor degrees.

Murray is positive about the future, stating that “our apprenticeship programme will rectify the skills shortage over time, and we are already well into the process of identifying components that lend themselves to local manufacture and assembly. Further, we will continue with our sponsorships and donations programme, which stretches from partnering with The Learn Project (Let’s Educate a Rainbow Nation) to significant commitments to its AES Charitable trust, and include the supply of mathematics dictionaries into primary schools.”

He goes on to conclude that “the new codes demand a clear strategy if one is going to remain sufficiently competitive as a key supplier to customers who are themselves under pressure to maintain their own BEE ratings.”