Opinion: BEE Reform Must Focus on Economic Growth, Not Just Ownership
The current scorecard system creates perverse incentives that prioritize deal-making over building sustainable businesses.
Thirty years after the end of apartheid, South Africa's black economic empowerment framework remains a subject of intense debate. The current B-BBEE scorecard system, with its emphasis on ownership transfers and management representation, has undeniably created a black middle class and changed the face of corporate South Africa.
But it has also produced perverse incentives. The market for BEE deals often values transaction structures more than operational competence. Companies game the scorecard through fronting and complex ownership vehicles that satisfy auditors while delivering little real economic participation.
A reformed system should prioritize enterprise development, skills transfer, and job creation over ownership metrics that can be manufactured on paper. The goal should be building sustainable businesses that employ South Africans and pay taxes here, not just redistributing shares in existing enterprises.