Bbbee act Explained

Bbbee actAfter the country’s first democratic elections in 1994, the government devised various policies which are aimed at reducing the effects that the previous government’s unequal policies had on the masses. In particular in the formal business environment, it was necessary that formal steps be taken to help the previously disadvantaged people to positively contribute and participate in the economy.

Central to this was the development of what is called the Preferential Procurement facet which made sure that any government tenders get assigned to people who are black or at least partially black. Any supplier would then be allotted points regarding the degree of compliance that they met and would thus by awarded government contracts on this scale.

Where any white-owned providers provided black proof of ownership for the company, there was a small but empowered set of groups which benefited in the short term. It would seem as though these individuals and businesses would benefit without any of those benefits being transferred to the broader community.

This followed that there was a realisation that a broader view of empowerment was needed in order to promote long term sustainability in the communities where it was needed the most.

Thus, Bbbee act  has evolved in order to include seven core elements which were aimed to broadening empowerment. These elements were:

  • Bbbee: Ownership: This is to the extent that the company have black shareholders.
  • Bbbee act: Management control: this was how much black people would have strategic and operation control in the company.
  • Bbbee: Employment equity: this is how many black people are employed in the company.
  • Preferential procurement: how the business will procure services and goods from black suppliers.
  • Bbbee act: Skills development: how the company is investing in skills training for black employees.
  • Bbbee: Enterprise development: how the company is assisting black business development in the country.
  • Bbbee act: Corporate investment: how the company is assisting black beneficiaries.

 

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  1. www.financialauditor.co.za
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  3. www.accountingwise.co.za

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