The Financial Sector Transformation Council (FSTC) has given entities operating in the financial sector until 13 October to submit their broad-based black economic empowerment (B-BBEE) compliance reports for 2021/22.
Section 10(4) of the B-BBEE Act requires enterprises operating in a sector in respect of which the Minister of Trade, Industry and Competition has issued a code of good practice to report annually on their B-BBEE compliance to the council established for that sector.
Statement FS 000, paragraph 8.5 of the Financial Sector Code (FSC) requires financial institutions in South Africa to provide an annual report to the FSTC outlining their progress in implementing the provisions of the FS Code.
The Code applies to all natural or juristic persons conducting a business, trade, or profession in the South African financial sector, including the following:
- Banking;
- Long-term insurance;
- Short-term insurance;
- Reinsurance;
- Retirement fund administration;
- The management of collective investment scheme assets;
- Financial services intermediation and brokerage;
- Public entities involved in the financial sector;
- Asset management, consulting, and administration;
- Private equity, venture capitalist, and impact investors;
- Management of investments on behalf of the public, including private equity, members of any exchange licensed to trade equities or financial instruments in South Africa, and entities listed as part of the financial index of a licensed exchange;
- Underwriting management agents; and
- Industry trade associations operating in the sector.
The Code does not apply to:
- Natural or juristic persons who do not have trading operations in the Republic; and
- Managers of investments on behalf of the public who are not subject to regulation by the FSCA, such as lawyers who hold money in intermediate trusts.
In Reporting Notice 1 of 2023, published on 13 July, the FSTC said all financial sector entities must report on their progress in implementing the provisions of the Code for the period 1 December 2021 to 30 November 2022.
The extent to which an entity must comply depends on the category under which it falls. Each category is determined by the entity’s annual total revenue.
The category under which an entity falls will determine its compliance requirements. Each category’s compliance requirements are as follows:
The information must be emailed to reporting@fstc.org.za by the close of the business on Friday, 13 October. The subject line must be: FSTC 2021/22 Reporting – [name of entity].
Entities encountering difficulties in submitting the requested information should contact the FSTC at reporting@fstc.org.za or 087 062 5950.
The FSTC indicated that no extension will be granted. Reports received after the deadline will be treated as a non-submission, and the person will be downgraded by one B-BBEE-level.
The FSTC said it would treat all the information supplied with the strictest confidence.
In terms of the FSC, the FSTC can name entities that do not submit reports.
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