| 4.1 | This charter applies to the South African operations of the financial sector. |
| 4.2 | The targets in this charter will be applied from 1 January 2004 (the "effective date") until 31 December 2014. |
| 4.3 | In 2009 (based on the reports for the year ended 31 December 2008), the Charter Council will undertake a comprehensive mid-term review and make decisions regarding the implementation of the charter in its second term. The ownership provisions will be reviewed in 2011 to address identified shortcomings. The ownership provisions will be reviewed by the Charter Council in 2011 to decide what further steps (if any) to address Identified shortcomings should be taken at individual financial institution, sub sector, sector or national levels. |
| 4.4 | The parties to this charter agree that the principles contained in the charter will be relevant beyond 2015. In 2015 (based on the reports for the year ended 31 December 2014) the Charter Council will undertake a second comprehensive review of progress in terms of the charter, and draw conclusions as to the impact of the charter on the sector and the economy, and make decisions as to what further steps (if any) to address identified shortcomings should be taken at individual financial institution, sub sector, sector or national levels. |
| 4.5 | All the provisions of the charter are to be achieved in a manner consistent with sound business practice. |
| 4.6 | Certain of the provisions of the charter will not apply in the same manner to all financial institutions. The following qualifications are provided for: |
| 4.6.1 | Exemption from the Human Resource Development provisions |
If the financial institution has less than 50 staff members, it will be exempt from the provisions of paragraphs 5, 11.3 and 11.4 of the charter unless it opts to be so bound. But it will nevertheless remain bound by all labour legislation (and specifically the provisions of the Employment Equity, Labour Relations and Skills Development Acts).
| 4.6.2 | Exemption from the Empowerment Financing provisions |
If the financial institution has less than R10 m of designated investments it will be exempt from the provisions of paragraph 9 of the charter unless it opts to be so bound.
| 4.6.3 | Exemption from all the provisions |
If the financial institution has less than 50 staff members and less than R10 m of designated investments, it will be exempt from all the provisions of the charter unless it opts to be so bound.
| 4.6.4 | Qualifications if there is a global policy to which the financial institution is subject |
If, in terms of a global policy to which a financial institution is subject, —
| • | any board members, executive or senior managers are imposed on the local operation, those personnel will not be taken into account for the purposes of calculating ratios in terms of paragraphs 5 or 11 of the charter; |
| • | it is precluded from accommodating local ownership participation, it will be exempt from the ownership provisions of paragraph 10 of the charter. |
| 4.6.5 | Exemption from the Access provisions |
| • | If the financial institution is a wholesaler, in the sense that it is not a provider of first-order financial products and services, it will be exempt from the provisions of paragraph 8 of the charter unless it opts to be so bound. |
| • | If the financial institution is a retailer of first-order financial products and services but, on grounds presented to and accepted by the Charter Council, it would be inconsistent with its business model for it to extend those products or services to low-income communities, it will only be responsible for the consumer education component of access (paragraph 8.4), and the points will be adjusted accordingly. |
| 4.6.6 | Qualifications in respect of retirement funds |
If a retirement fund has less than 50 staff members, it will be exempt from all the provisions of the charter other than paragraphs 9 and 12.
If a retirement fund has more than 50 staff members, it will be exempt from ail the provisions of the charter other than paragraphs 5, 11.3 and 11.4, and paragraphs 9 and 12.
| 4.7 | All financial institutions claiming exemptions in terms of this paragraph must submit a return to the Charter Council providing motivation and evidence supporting the exemption. |
| 4.8 | The participation of DFIs in certain aspects of the charter is required in order to give full effect to the intent of the charter. |
| 4.9 | If a financial institution is a member of a group, it will be measured and reported on as part of the South African group unless — |
| • | the financial institution is a listed company; or |
| • | the financial institution opts in. |
| 4.10 | Notwithstanding the provisions of paragraph 4.9 above, the boards of directors of all financial institutions will ensure that transformation plans are rolled out through all the divisions and subsidiaries of the group, and that measurement mechanisms are put in place, responsibility given and performance evaluated at all levels and in all areas. |
| 4.11 | The parties to this charter agree that the public and private sectors, when sourcing products and services from the financial sector, should apply the charter and its scorecard. Accordingly — |
| 4.11.1 | the financial institutions specifically agree that, when competing for business, they will use their charter rating to explain their BEE contribution; |
| 4.11.2 | in adjudicating tenders for the provision of financial services, all tiers of Government will base their adjudication of BEE contribution on the charter rating which has been accorded in terms of this charter; and |
| 4.11.3 | the parties to this charter agree that the private sector should base its evaluation of the BEE contribution of members of the financial sector on the charter rating which has been accorded in terms of this charter. |
