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Broad Based BEE

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Broad Based BEE

The Complete Guide

Frontrunner,

15 min read
10 take-aways
Text available

What's inside?

Comprehensive handbook for companies that must deal with the South African Black Economic Empowerment Codes of Good Practice.

Editorial Rating

7

Qualities

  • Applicable

Recommendation

In this guidebook, Vuyo Jack combines legislative summary, accounting detail and historical context. He analyzes South Africa’s numerous Codes of Good Practice (and their subsidiary statements) enacted to promote black business empowerment and explains them in considerable detail. He provides context for understanding the Black Economic Empowerment codes and sample scorecards for various aspects of compliance. Yet this straightforward, accounting-manual treatment of the codes is frequently interrupted by his personal opinions, judgments or remembrances. The author becomes an advocate for a viewpoint rather than a dispassionate reporter on the contents of the code. Readers who are accustomed to more hands-off reporting may wonder whether Jack’s advocacy compromises or shades his approach to the bare facts. Nevertheless, getAbstract recommends his thorough explanation to companies working in South Africa.

Summary

Black Economic Empowerment: The Basics

Black Economic Empowerment (BEE) is an attempt to redress the pernicious effects of the apartheid system in South Africa. White people often initially react to the BEE codes with denial, believing that the rules don’t apply to them. However, the BEE program affects even businesses that do not sell directly to the South African government because the government evaluates not only first-tier suppliers but also suppliers to its first-tier suppliers. So the BEE requirements affect a much broader range of companies than just those directly supplying the government.

The apartheid era began in the early years of the 20th century and ended in 1994. During this period, legislation restricted black ownership of land, residences and business activities. Such legislation prevented blacks from developing expertise in commercial agriculture, entrepreneurship and business management. Legislation gave preference to whites even as unskilled laborers.

Black economic empowerment effectively began in 1993 with the sale of controlling interest in an insurance company to a black investment group, New Africa Investments, Ltd. (Nail). Nail became...

About the Author

Vuyo Jack is a chartered accountant. He is a co-founder and chairman of the Black Economic Empowerment rating agency, Empowerdex. He is also a visiting professor at the School of Management of the University of the Free State and a venture capitalist.

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