The Broad-based Black Economic Empowerment Act was formulated as an economic tool of transformation. The revised B-BBEE Codes of Good Practice, born out of the Act came into effect on 1 October 2015 after a 12 month transition period. During this time, Pioneer Foods revisited its strategy and targets in order to implement an action plan that supports government’s and the company’s vision of building a more economically inclusive society.
For the 2017 financial year, the Group was rated according to the agricultural sector (“AgriBEE”) scorecard and improved from a level 4 to a level 3 status
Transfer in ownership: Phase 1, 2006
Phase 1 took place in 2006 when 18.1 million vote-bearing Class “A” standard shares were allocated to all Group workers below management level. This translated into employees acquiring 10% of the voting rights in the Group.
The cost to the Group of the 2006 BEE transaction was R163 million (4.4% of the Group’s market capitalisation at the time). The Group supplied the funding with 70% of the dividends from these shares being used to redeem a notional debt. To date, the Group has paid out more than R17 million in dividends to the beneficiaries of this scheme.
The Group used the capital obtained through this second transaction in capital expansion programmes. This created employment opportunities for the communities in which we operate.
The Pioneer Foods Education and Community Trust
The Pioneer Foods Education and Community Trust is administered as a broad-based ownership scheme to align with BEE Codes. The Trust contributes to school buildings and equipment for public schools and educational institutions that help uplift their communities. It also provides scholarships, bursaries, awards and loans for study, research and teaching. Previously disadvantaged individuals – in particular, black women – make up the majority of those that benefit from the Trust.