The Broad-based Black Economic Empowerment Act 53 of 2003, is said to be the most powerful piece of legislation affecting South African businesses today. The Minister of Trade and Industry, Dr Rob Davies says “the Broad-Based Economic Empowerment (B-BBEE) Commission should take action against companies that are found to not be complying with the B-BBEE requirements for transformation.”
Everyone wants change but struggles to accept it. B-BBEE need not be seen as a negative for your business but rather an investment for economic sustainability.
Like every investment, the structure needs to be unique to your B-BBEE requirements and the return needs to be worth it.
To fully embrace B-BBEE and its longevity within your business, it extends far more than just the certificate. “No economy can grow by excluding any part of its people, and an economy that is not growing cannot integrate all of its citizens in a meaningful way,” the DTI says. “As such, this strategy stresses a BEE process that is associated with growth, development and enterprise development, and not merely the redistribution of existing wealth.”
There is no standard one-size fits all approach to becoming B-BBEE compliant, there are structures, legal documents, tax implications and your value to consider. It is however imperative to find the right equity partner – NO agreement can rectify a bad relationship. A good partnership won’t happen overnight, so trying to put on a “band aid” to save your business or when there’s a big tender on line, might have catastrophic legal, financial and criminal consequences for your business.
There is no quick fix to B-BBEE, do it right from the start and your B-BBEE investment will deliver!
PS If you find B-BBEE to be confusing, daunting and even frightening meet with us, we can help.