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Written by Paul Janisch
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Paul Janisch is a director of Caird, a South African broad based BEE consultancy. He keeps a regular BEE blog at http://bbbee.typepad.com/paul_janisch/. Janisch can be contacted at
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, +2783 227 1375 or (+2711) 666-0928. Caird’s website is www.caird.co.za.
When South Africa’s Broad-based Black Economic Empowerment Act was promulgated in 2003 the world paid attention. Empowerment of the local population was not something that could be regarded as new; Namibia has had its Namibianisation policy since the early 90s. A policy that had a far-reaching effect and that could potentially impact the entire marginalised population was something different. The act was followed by a flurry of activity that produced numerous industry transformation charters and ultimately culminated in the gazetting of the Trade and Industry Department’s B-BBEE codes of good practice.
Until 2003 empowerment had been measured using a narrow base, which effectively was ownership of the enterprise. Whilst this practice did result in escalating the wealth of a few black South Africans it did very little to assist the vast majority of the population. Broad-based BEE was devised to incorporate a larger number of people and had the potential to embrace employees and people outside of the organisation. Seven elements were identified as being the best measure of transformation of the economy; these were Ownership, Management, Employment Equity, Preferential Procurement, Enterprise Development and Socio Economic Development (formerly known as corporate social investment). Each element is provided with a target and a weighting.
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