Two years ago, the Small Business Institute sent letters to 100 of the JSE’s largest companies, asking them to share with us their payment terms for the small businesses in their supply chain.
Just prior to lockdown, we met with several shareholder activists and the JSE to escalate our campaign to link prompt payment with good governance, sustainability and disclosure rules.The relationship is symbiotic, allowing the big guy to do what it does and, ideally, fortifying the small guy to one day become big. Along the way, jobs are created, new businesses spring up, and we see and appreciate the innovation, hustle and energy that fuels an economy.
Committing to paying SMEs in 30 days or less is the first step. Measurement – and reporting – will matter, moving enterprise development away from a simple tick-box exercise. And this was before Covid-19. The headwinds were already blowing and included load shedding, the downgrade of our sovereign debt and the mille feuille red tape.
The commitment by more than 50 of South Africa’s largest corporates is the first step, which we applaud.