It is essentially a growth strategy, targeting the South African economy’s weakest point: inequality.īlack economic empowerment is an important policy instrument aimed at broadening the economic base of the country – and through this, at stimulating further economic growth and creating employment. The strategy is broad-based, as shown in the name of the legislation: the Broad Based Black Economic Empowerment Act of 2003. Nor does it aim to take wealth from one group and give it to another. Towards broad-based growthīlack economic empowerment – or broad-based black economic empowerment, as it is technically known – is not affirmative action, although employment equity forms part of it. Most companies operating in South Africa therefore have a CSI policy whereby they support some form of charity or other type of development projects. BBBEE is enforced through preferential procurement, and compliance is necessary when companies aim to do business with government or large corporations. Under the BBBEE guidelines 1% of net profit before tax should be spent on social development, whereby companies are encouraged to have at least 75% non-white beneficiaries. This is translated into encouragement for companies to give back to the community through Corporate Social Investment (CSI). One element of Broad-Based Black Economic Empowerment (BBBEE) policy is companies’ contribution to socio-economic development. Despite the many economic gains made in the country since 1994, the racial divide between rich and poor remains.

In the decades before South Africa achieved democracy in 1994, the apartheid government systematically excluded African, Indian and coloured people from meaningful participation in the country’s economy. It is a pragmatic growth strategy that aims to realise the country’s full economic potential while helping to bring the black majority into the economic mainstream. South Africa’s policy of black economic empowerment (BEE later BBBEE) is not simply a moral initiative to redress the wrongs of the past.

Who qualifies as black for bee