CGF ARTICLES, OPINIONS & EDITORIALS
Overhauling the B-BBEE Codes - Mixed views? (2013-02-27)
February 20,
2015 3523 3523 
There’s been much debate amongst the critics regarding the Broad-Based Black Economic Empowerment (B-BBEE) Codes of Good Practice (the codes), and whether or not they have become overly draconian in nature.
The new codes were unveiled by Minister Rob Davies in October 2012 and contain a framework for determining the B-BBEE scorecard and guidelines, including the manner in which companies will be measured once the codes are implemented.
The revised codes contain some significant and far reaching implications for companies in South Africa; and many fear its objectives have become overly prescriptive and will -- contrary to its original intent -- begin to discourage broad-based black transformation.
Of course B-BBEE continues to be an imperative to South Africa’s economic growth and development and the proposal to change the general scorecard may eventually address certain inconsistencies and interpretative issues found within the original codes. The revised codes aim to enhance the integration of black people into the economy in a meaningful and sustainable manner and through its principles and guidelines, facilitate and accelerate the implementation of B-BBEE through the introduction of the three priority elements; namely Ownership, Skills Development and Enterprise & Supplier Development.
Under the revised codes, many believe organisations will find it more difficult to achieve -- or even retain -- their existing B-BBEE status. To this end, if organisations measured on the Generic Scorecard do not comply with all the proposed priority elements, their B-BBEE Level will drop (be discounted) by two levels. Similarly, even QSEs (Qualifying Small Entities) are not left off the hook if they fail to meet the minimum thresholds in two of the Scorecard elements and they will find their BEE Level dropping by one level.
Expectedly there has been much frustration due to the slow progress in the area of Broad-Based Black Economic transformation since it was originally signed into law in January 2004. Driving the point further, the BMF (Black Management Forum) which was founded in 1976, have taken a hard stance in support of the proposed new codes saying “that the B-BBEE Act must supersede all other laws and policy tools that seek to achieve economic transformation” and that it “must be the country’s trumping legal and policy framework.”
