By Noko Mashilo
Both small businesses and large corporates in South Africa are mandated to hold a Broad-Based Black Economic Empowerment certificate, commonly known as B-BBEE or triple BEE. Norman Manganyi, who is the general manager at Eruditio, a national entity focusing on skills development, enterprise and supplier development, explains that B-BBEE is a government framework designed to integrate previously disadvantaged groups into the mainstream economy. “This legislation addresses historical economic injustices,” he said.
“It mandates a scorecard system for B-BBEE compliance across South African corporate entities, encompassing five key pillars.”
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- Ownership: This measures the economic interest and voting rights held by black individuals in a business, accounting for up to 25 points on the scorecard.
- Management Control: Evaluates the representation of black executives and decision-makers within the company, contributing 19 points to the score.
- Skills Development: Involves funding learnerships for young individuals to gain qualifications, with a stipend aligned to the national minimum wage. This pillar contributes 20 points.
- Enterprise and Supplier Development: Allocates funds equivalent to 3% of revenue towards developing small black-owned businesses. This includes financial training, marketing assistance, and business planning support, earning up to 44 points on the scorecard.
- Socio-Economic Development: Focuses on community investment to enhance economic participation, yielding 5 points.
Manganyi emphasises that achieving compliance levels such as Level 1 enables enterprises to engage in government contracts, underscoring the importance of investing in black-owned businesses to attain this status. Sibusiso Radebe, 26, of Presida, an advertising agency that specialises in billboards, said his company was first absorbed by business development services company Black Umbrellas during an incubator programme in business courses.
“I later joined Eruditio where I was trained in enterprise and supplier development. The two institutions made things possible for me in running my business with ease. I would not have acquired the knowledge I have if I had not been part of these programmes.“It boosted my business a lot and I even received a grant that I injected into the daily running of the business,” said Radebe, whose business is based in Duduza, Ekurhuleni.
Another beneficiary, Buti Ramahuma, 50, who owns Tembisa Print in Maokeng in Ekurhuleni, said he got a call from Eruditio that he was recommended by the Peermont group and qualified for enterprise and supplier development programmes. “In enterprise development, we were given training on running and repositioning our company in finances, marketing, compliance with tax and B-BBEE. By that time, their sponsor was Hyundai. “In a way, they were helping Hyundai in terms of their B-BBEE status by training small businesses. A year later, my supplier development was sponsored by Sanofi from France under Eruditio,” he said.
Ramahuma said that he also got a grant for two machines and later became their supplier when it came to printing. “This is how big corporates earn B-BBEE scores by helping small black-owned businesses,” said Ramahuma, whose company was 100% black-owned and Level 1 B-BBEE complaint. Ultimately, B-BBEE serves as a critical framework for fostering inclusive economic growth in South Africa, promoting equity and opportunity across all sectors of society.
