The Black Business Council (BBC) has welcomed the signing into law by President Cyril Ramaphosa of two bills impacting business as a “positive step to reduce red tape”.
BBC CEO Kganki Matabane said “the signing of these two bills into law shows that we are moving into the right direction as the business sector in the country and as such we are happy as the BBC, as this will change the status quo on how things are done in the business sector, especially where black businesses are being marginalised and supressed”.
Ramaphosa signed into law a change to the Companies Act of 2008, with the aim of promoting new models of doing business to open opportunities and transparency and dealing with gap disparities of pay among companies’ executives.
The Companies Amendment Bill and Companies Second Amendment Bill, signed by the president, are aimed at jointly constituting initiatives by government to make business easier to conduct with no hassles involved.
Ramaphosa’s spokesperson, Vincent Magwenya, said the Companies Amendment Act streamlined company law to be clear, user-friendly. “This reform is important for the efficient and effective conduct of the domestic economy as well as the attraction of foreign investment.
“The act is also aimed at achieving equity between directors and senior management on the one hand, and shareholders and workers on the other hand.
“In addition, the law addresses public concerns regarding high levels of inequalities in society by introducing better disclosure of senior executive remuneration and the reasonableness of the remuneration.”
According to the law, companies in the public and private sectors are required to prepare a report of remuneration in respect of the previous financial year.
“This remuneration report must be accompanied by the company’s remuneration policy and an implementation report that must set out detail on the total remuneration received by each director and prescribed officer as well as the total remuneration for the employee with the highest and lowest total remuneration. Among other indicators, companies must report the average and median total remuneration of all employees and disclose the remuneration gap between the total remuneration of the top 5% highest paid employees, and the total remuneration of the bottom 5% lowest paid employees of the company,” said Magwenya.
The law also states that companies, including state-owned entities, were now required to present a remuneration policy for shareholder approval.
