Enterprise Development Agreement Letter
SD contributions are paid to companies that are already part of the current supplier chain of the measured company (ME). ED contributions are paid to companies that are not part of the ME supply chain. Enterprise Development (ED) and Supplier Development (SD) is one of the three priority elements of Broad-Based Black Economic Empowerment (B-BBEE). A company must achieve a rate of 40% of each of the categories on the ED and SD scorecards (without bonus points). SD 4 points of 10 points and 2 points ED of 5 points. Failure to meet the 40% subminimum results in a one-notch drop in the B-BBEE scorecard. An entity may make monetary or non-monetary contributions to a recipient enterprise. Requirements may vary when a company is reviewed on the basis of a particular industry code. Here are the most common types of contributions that ME`s makes to ED or SD recipients: To determine who it needs to support, an ME should critically analyze the nature of the recipient.
Some factors to consider: The following documentation is required to prove ED and SD contributions:. . . .