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A TRC for the economy

By Craig Canavan

A lack of information, coupled with the general ignorance of business and public alike of what South Africa’s Black Economic Empowerment (BEE) policies really mean, are the main causes behind the slow pace of transformation in the business sector.

BEE ConferenceThis was one of the main themes to emerge from the first day of the inaugural annual Bee Conference held at Johannesburg’s Pyramid conference centre on 7 and 8 November.

“It’s the most misunderstood, misinterpreted piece of legislation I think this country has ever seen,” said William Janisch, director of Empowerment Services.

“I think the concept of BEE has become blurred. The mention of BEE tends to strike fear in to the hearts of most who hear it: white people fear their future; black people fear that they may be passed over.”

It was a sentiment echoed by most of the other speakers at the conference, organised to combat this very problem. One after another, and irrespective of colour or gender, the speakers all pleaded with business to give BEE a chance; and to take the time to learn and understand their place in the process.

“The fact of the matter is that our economy needs a revolution,” Janisch said. “We hope that revolution will be driven, in part, by BEE. We cannot simply ignore the past and wish it away like a bad dream; it happened and whether or not you were directly responsible, everyone has a role to play in redressing the past. To me BEE is like an economic version of the Truth and Reconciliation Commission.

It was also pointed out that disappointing figures from a recent BEE compliance survey, which found that of the companies that responded only 10% recorded excellent compliance while a whopping 78% recorded no compliance at all, should not be too disheartening.

“BEE going forward now will be nothing like BEE in the past five years, mainly because of the verification process and BEE codes that have now been put in to place,” explained Janisch. “That and the fact that more and more information is now being disseminated about the process, how to implement it and what it means to your company.”

Thami Mazwai While most speakers called for patience and exuding a cautious optimism, journalist, editor and CEO of Mafube Publishing Thami Mazwai expressed his disgust at how long the process had taken. He stated his belief that South Africa’s next president had to stand on a BEE platform.

“We’ve been talking transformation for over 13 years and all we can boast is 10% excellent compliance? That’s a growth of less than 1% per year and it’s not good enough. Frankly, I’m shocked there has not been more outrage from the black community.”

However, he refused to call for more government intervention in forcing compliance: “Serious economic empowerment will only happen if we ourselves drive it, not government and not white-owned business.They have their part to play, and the success of the Employment Equity Act, which was enforced, means we do need to look at government intervention. But the black community must be in the driving seat.”

Independent analyst Reg Rumney, on the other hand, questioned the reliance on BEE to mend all our economic woes.

Calling himself a minimalist in his approach to BEE, Rumney said that what was needed was not black economic empowerment, but economic empowerment for all, especially the poor.

“Does making Thami Mazwai richer help poor black people?” he asked. “I don’t think BEE is sufficient in itself to solve our problems. With the BEE codes, for example, 20 points is the maximum you can score with poverty alleviation schemes; the rest of the codes are aimed at the small black middle-class. And it focuses on enriching them, not expanding them.”

For further information on Black Economic Empowerment, from how the compliance codes work to case studies on how to implement BEE, visit the following websites:

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The Big Change is a business strategy blog and newsletter published by Arthur Goldstuck, managing director of World Wide Worx, a leading technology research organisation based in Johannesburg, South Africa.

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