The average working citizen has an idea of B-BBEE but lacks understanding of the pillars that make up the B-BBEE act. In part, this can be attributed to the lack of consistency in messaging and ambiguity. At its core, the act is about advancing economic transformation and enhancing the economic participation of black people in South Africa. How better to achieve this than by making it a compliance factor. The measuring criteria in terms of the B-BBEE Codes of Good Practice acknowledge five criteria – which are the pillars of B-BBEE. In this article, we break down the five pillars to help you understanding of B-BBEE.
Five pillars of B-BBEE
Originally, the B-BBEE act had seven pillars,these were amended in 2013 to five pillars. Prior to the amendments, ownership was a key element/pillar in promoting transformation. Despite there been several other elements/pillars, much focus is placed on ownership. Below are the pillars or elements on which a company’s B-BBEE status level is measured by and determined:
- Skills Development
- Enterprise and Supplier Development
- Socio-Economic Development
- Employment Equity
The B-BBEE Codes of Good Practice further includes several sector charters. These sector charters identify goals within certain economic sectors to promote sustainable B-BBEE in specific economic sectors. Companies operating within the sectors must be evaluated in terms of these Gazetted Charters. Entities need to carefully assess what is required from them as charters often set out stricter criteria than the generic codes.
To help you understand the requirements for specific sectors, we run training sessions on each sector – these sessions are public but can be delivered on-site. Get in touch with our training department to find out more or view our upcoming B-BBEE training sessions.
Does B-BBEE Compliance affect my business?
The answer is yes! Non-compliance results in penalties from the B-BBEE commission, loss of status level and eventual decline in growth and profit. Furthermore, your business will then become an addition to the socio-economic issues plaguing South Africa; rather than being part of the solution to improve these issues.
We offer a free consultation – get in touch with one of our dedicated consultants to see how our sustainable transformational strategies can bring mutual growth and success; for your organisation and the community.