Broad-Based Black Economic Empowerment (B-BBEE) is essentially a policy aimed at levelling the economic playing field. Companies will have to be pro-active in their approach to transformation in order to ensure access to enhanced business opportunities and more importantly, exercising their moral obligation to improve the lives of South Africans. 

How are entities classified?

  • EME (Exempt Micro Enterprises) – entities with a turnover of less than or equal to R10 million per annum.  Such entities are automatically classified as a level 4 contributor status with no black ownership.  With 51% black ownership they are elevated to a Level 2 and with 100% black ownership to a Level 1.
  • QSE (Qualifying Small Enterprises) – entities with a turnover of more than R10 million per annum but less than or equal to R50 million.  These entities are measured against a specific scorecard for QSE’s.  With 51% black ownership they are elevated to a Level 2 and with 100% black ownership to a Level 1 without the need for measurement against a scorecard. 
  • Generic Enterprises – enterprises with a minimum turnover of more than R50 million per annum.  Such entities would need to undergo and audit and would be measured against their sector specific codes.

How are businesses scored?

There are five elements which need to be measured in scoring an entity based on the Generic B-BBEE Codes.

  • Ownership – The percentage black ownership and voting rights of the entity is measured in this element.   Special consideration is given to black women ownership and voting rights as well as that of certain groups.  This element is regarded as a priority element.
  • Management Control – This element measures the extent to which black participation exists within all levels of management relevant to targets outlined in the various sector codes and taking into account the demographics of the country or province in which the entity operates.
  • Skills Development – This element measures the extent to which the company invests in black employees or non-employees.  This element is regarded as a priority element.

 

  • Enterprise and Supplier Development – This element measures the compliance level and black ownership of the entity’s supply chain relevant to the targets outlined in the appropriate sector codes.  This element is regarded as a priority element.
  • Socio Economic Development – This element measures the monetary and non-monetary contributions by an entity in favour of beneficiaries in order to create sustainable access to the economy for those beneficiaries.  This is measured against the targets outlined in the appropriate sector codes.

 

 

         Entities must score a minimum of 40%               (excluding bonus points) of the available           points for priority elements.  Failure to               comply will result in the discounting of               the final BEE level by 1 level.  Only the               discounted level shall appear on the face           of the BEE Certificate.