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The amount of money the South African banking group Nedcor spends with black businesses rose to 22 per cent of its total supplier payments last year, from nine per cent in the previous period.
The group said the increase was largely attributable to changes in its procurement policy, which now require it to source more goods and services from black-owned or ‘black-influenced’ companies.
A ‘black economic empowerment procurement measurement unit’ initially targeted the top 200 suppliers, which account for about 80 per cent of the group’s spending, but has since extended its activities to cover all 6000 of Nedcor’s suppliers.
This year there will also be greater emphasis on smaller black-owned or controlled businesses, from which Nedcor eventually wants to buy five per cent by value of its goods and services. Its procurement costs fell by R119m (£10m, $18m) last year as a result of the policy.
Nedcor is South Africa’s second-largest banking group by market capitalization and had net profits of R1.3billion in 2004.
The group said the increase was largely attributable to changes in its procurement policy, which now require it to source more goods and services from black-owned or ‘black-influenced’ companies.
A ‘black economic empowerment procurement measurement unit’ initially targeted the top 200 suppliers, which account for about 80 per cent of the group’s spending, but has since extended its activities to cover all 6000 of Nedcor’s suppliers.
This year there will also be greater emphasis on smaller black-owned or controlled businesses, from which Nedcor eventually wants to buy five per cent by value of its goods and services. Its procurement costs fell by R119m (£10m, $18m) last year as a result of the policy.
Nedcor is South Africa’s second-largest banking group by market capitalization and had net profits of R1.3billion in 2004.
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