OPINION | South Africans need to believe in broad-based black economic empowerment again - Implemented correctly, B-BBEE could shift the economy into a positive direction in as little as three to five years
South African society has little faith in broad-based black economic empowerment . Many think it’s just there to benefit a politically connected elite or that white-owned companies must give away 51% of their businesses.
For most businesses, B-BBEE has become about saving as much money as possible while getting the maximum points. That’s not entirely surprising, because enterprise and supplier development can cost as much as 5% of a company’s net profit after tax. Companies can get up to 40 points on their B-BBEE scorecards for enterprise and supplier development, 20 points for skills development and five points for socioeconomic development. All three get a business to level-four compliance. They can also use B-BBEE initiatives to boost their corporate social investment credentials.
By identifying and investing in sound and innovative start-ups — which can then scale up and grow aggressively to be sustainable — we would be starting to create more permanent and valuable jobs. This addresses the problem of local economic development and growth.
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