While South Africa’s broad-based black economic empowerment (BBBEE) regulator, the BBBEE Commission, says the relevant legislation has resulted in several successes since its promulgation in 2003, it insists that there are still challenges related to how the legislation is implemented.
This was highlighted at the BBBEE Commission’s yearly conference on April 1, under the theme ‘Broad-Based Black Economic Empowerment, Quo Vadis?’
A common theme mentioned by speakers was that the necessary task of transforming the economy required a collaborative effort and that, while the BBBEE legislation provided a good tool to achieve this, more buy-in was required from all stakeholders and that proper implementation must be undertaken.
Trade, Industry and Competition Minister Ebrahim Patel emphasised that the manner in which BBBEE was implemented should always be such that it promoted investment.
Research and consulting firm Intellidex executive chairperson Dr Stuart Theobald noted that what needed to be considered now was how BBBEE fitted into solving the twin challenges of youth unemployment and low growth that were affecting the country.
He stressed that the economy had to be transformed in such a way that it could absorb youth labour in large numbers.
Moreover, it had to confront the country’s growth history, with this having experienced several years of declining gross domestic product growth, which is not sustainable.
Theobald highlighted that BBBEE had been one of the most important regulatory frameworks for business in the country as a whole, with it having a considerable impact on the way business is done across the country.
An important area of focus for corporates was cited as skills and enterprise development, with a need to scale up and ensure that workers and the youth were developed for the skillsets of the future.
Moreover, while this is being done to some extent, this does not always result in better opportunities, with those that are trained not given the opportunity to rise to board and higher management levels.
Management consulting firm Redflank Solutions director Lings Naidoo said research conducted by the company showed that the commission was perceived as doing relatively well in terms of immediate objectives.
However, when it comes to the commission’s ultimate outcomes, perceptions were mixed.
He said a key reason for this was that achieving the ultimate outcomes of economic transformation required collaboration with other parties and the commission was unable to achieve alone.
Naidoo pointed out that the legislation provided guidance and incentives to do the right thing in terms of driving transformation.
However, there also needed to be cognisance of the current environment, he noted. He explained, for example, that the economy was badly affected by the Covid-19 pandemic and, while large corporates and industries such as agriculture were recovering well, smaller players required more attention.
Moreover, he said the commission needed to be better capacitated to achieve its aims.
Other concerns that came up were that some corporates see BBBEE as a “box-ticking” exercise. Consequently, the way they implement this results in the benefits not being realised by the intended beneficiaries.
Sectors that were seeing positive developments in terms of economic empowerment were highlighted as transport and construction. By contrast, those lagging were the financial, property and tourism sectors.
Awards
To recognise entities that have added value in the transformation push, using BBBEE as an anchoring tool, the conference ended with an awards ceremony.
The awards that were given included the BBBEE Acquiescent Award, which was awarded to Weba SA. This category recognised the entity that had adhered to the advice of the BBBEE Commission and corrected conduct that was contrary to the BBBEE Act.
The BBBEE Diligentia Award was awarded to Eskom, the South African National Roads Agency, the Gauteng Department of Economic Development and the Manufacturing and Engineering Sector Education and Training Authority. This category recognised government entities for their continued effort in conducting due diligence during their procurement processes to ensure BBBEE compliance.