Broad-Based Black Economic Empowerment

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Broad-Based Black Economic Empowerment ( B-BBEE or BBBEE for short ; German about “Broad-based economic empowerment for blacks”) is an affirmative action program to achieve equal economic opportunities for formerly disadvantaged citizens in South Africa . It was started in 2003 under the shorter name Black Economic Empowerment (BEE) and modified several times. Contrary to its name, it also provides for the promotion of Coloreds and Indians .

history

In the course of the decades of apartheid , there was a great wealth gap in South Africa between white South Africans on the one hand and blacks, coloreds and Indians on the other. In 1994 the African National Congress (ANC) took over the government and ended this era. One of the most important goals of the ANC was a fairer distribution of opportunities, regardless of belonging to a population group. Despite the legal equality of all South African citizens, this goal could not be achieved. The Labor Relations Act was passed in 1995 and the Employment Equity Act in 1998 , which remained relatively ineffective. In 2001 a Commission report was presented to help the previously disadvantaged blacks, coloreds and Indians to have better opportunities in the economy. The program was started with the Broad-Based Black Economic Empowerment Act of 2003. At the same time, the advisory Black Economy Empowerment Advisory Council was founded with the South African President at the helm. In 2005 codes of good practice (for example: "Implementation Regulations") were introduced. However, it was found that only a minority benefited from the program.

In 2007, a modified version came into force that was intended to increase the number of beneficiaries. In 2013 the law was amended by the Broad-based Black Economic Empowerment Amendment Act ; the changes came into force in 2014.

Most of the country's large, publicly traded companies have largely implemented the program.

aims

B-BBEE is intended to guarantee equal opportunities in the world of work and in the promotion of training, to contribute to the creation of property for the previously disadvantaged and to give priority to certain groups when filling management positions.

"Broad-Based Black Economic Empowerment (B-BBEE) aims to ensure that the economy is structured and transformed to enable the meaningful participation of the majority of its citizens and to further create capacity within the broader economic landscape at all levels through skills development, employment equity, socio economic development, preferential procurement, enterprise development, especially small and medium enterprises, promoting the entry of black entrepreneurs into the mainstream of economic activity, and the advancement of co-operatives. "

"B-BBEE tries to ensure that the economy is structured and changed in order to enable the meaningful participation of the majority of citizens and to continue to create space at all levels within the broader economic landscape through professional training, through equality in employment, through socio-economic Development, preferential procurement, corporate development - especially of small and medium-sized companies - to encourage the entry of black entrepreneurs into the mainstream of economic activity, as well as the further development of cooperatives. "

- Explanation on the website of the Department of Economic Development

Regulations since 2014

For Broad-Based Black Economic Empowerment next to the law include codes of good practice ( "Implementing Rules" about) transformation charters (about "conversion agreements") sector charters (eg: "sectoral agreements") and scorecards ( "scorecards") . The Department of Trade and Industry (for example: "Ministry of Economic Affairs") is responsible.

The requirements of the B-BBEE must be met in the case of public tenders and government institutions. Private companies are excluded from public procurement and licensing if they do not meet the requirements.

A distinction is made between large enterprises (with at least 50 million Rand annual sales; large enterprises ), medium-sized ( small qualifying enterprises ) and small enterprises ( exempted micro-enterprises, under ten million Rand annual sales). Larger companies have to meet stricter requirements. Start-up enterprises have the status of a small business in the first year of their existence. The rules also apply to foreign investors.

A scorecard with a maximum of 105 points in five criteria decides on the allocation of a level, ideally level 1. The criteria are:

  • Creation of property, 25 points
  • Competence development, 20 points
  • Company and supplier development, 40 points
  • Management control, 15 points
  • socio-economic development, 5 points

For large companies, the first three criteria must be 40% of the maximum number of points in order not to be downgraded by one level. For medium-sized companies, this applies to the first and one of the two following criteria.

There are eight levels. As a result, depending on the level, a recognition level is determined in the form of a percentage that can exceed 100% and in level 8 is ten percent. A company that scores less than 40% on its scorecard is classified as "not eligible".

Companies that are 100% or at least 51% black, colored or Indian South African citizens and belong to the medium-sized or small companies are generally classified in level 1 or 2 on the scorecard .

The company has to prove its status with documents. The point values ​​are determined on the basis of an extensive set of formulas. There are additional points if women, disabled, young people or black people, colored people or Indians living in rural areas are supported.

In June 2017, a new “charter” was issued for South African mining companies. Accordingly, within one year at least 30% of the shareholders (until then 26%), 50% of the executive directors and 60% of the senior management must be black.

criticism

There is general criticism that funding is not based on qualifications and experience. The program has led to a brain drain for highly qualified whites. In 2004, former Archbishop Desmond Tutu criticized the fact that only a small, black elite would be supported while millions of South Africans continued to live in poverty. The South African publicist Moeletsi Mbeki also expressed himself accordingly in 2009 and criticized the fact that the law would promote “black capitalism”. In 2015, the Democratic Alliance complained that changes to the scorecards would make funding even less “on a broad basis” than before.

Web links

Individual evidence

  1. ↑ a b c d BEE on the website of the German Embassy in South Africa ( Memento from February 23, 2015 in the Internet Archive )
  2. ↑ Broad-based Black Economic Empowerment Act of 2003 (PDF), accessed on February 22, 2015
  3. ↑ Broad-based Black Economic Empowerment Amendment Act of 2013 (PDF), accessed February 22, 2015
  4. ↑ a b c d e BBBEE in South Africa at cbbl.lawyers.de, accessed on February 22, 2015
  5. ↑ a b c d e Code of Good Practice 2013 (English, PDF), accessed on February 22, 2015
  6. ↑ Black ownership in South African mines raised to 30 per cent. africanews.com, June 15, 2017, accessed December 27, 2017
  7. ^ Tutu issues warning against BEE and government policies. sahistory.org.za, accessed February 21, 2015
  8. ↑ Moeletsi Mbeki: The oligarchs are still in power. Afrika Süd, the specialist journal on southern Africa, volume 38, No. 5, October / November 2009
  9. ↑ DA calls for debate in parliament over elitist BEE codes. from the Democratic Alliance website, accessed May 10, 2015