Broad-Based Black Economic Empowerment Act, 2003 (Act No. 53 of 2003)Verification Manual15. Fronting |
| 15.1 | The Verification Agency assesses the risk of fronting by the measured entity and shall include the following minimum procedures when identified: |
| 15.1.1 | Review official ownership structure of the measured entity and understand the relationship between the measured entity and the holding company, affiliates and subsidiaries and related parties. |
| 15.1.2 | Review the organisational structure of the measured entity and the job descriptions of each position in the structure. |
| 15.1.3 | Inspect documentation which set out the responsibilities of the directors/ management to determine who participates in the core activities of the measured entity. |
| 15.1.4 | Confirm that the responsibilities, accountabilities and reward of black directors/management do not differ from the non-black directors/ management on the same level. |
| 15.1.5 | Review the minutes of the meetings of the board of directors and management and confirm who is responsible for making strategic decisions. |
| 15.1.6 | Inquire from directors or management what their role within the measured entity is. |
| 15.1.7 | Inspect personnel records and minutes for suspicious appointments and resignations of directors/management. |
| 15.1.8 | Inspect personnel records to determine significant differences in remuneration packages of black directors/management compared to the non black directors/management on the same level. |