Broad-Based Black Economic Empowerment or BBBEE is a particularly characteristic type of empowerment for the economy which was initially introduced by the government of South Africa as a thorough and active response against the traditional empowerment which was narrow-based and allegedly instituted by the country in 2003.
The Things that You Need to Consider
Now, the narrow-based empowerment was the reason for the enrichment of individuals who were previously disadvantaged – Coloured, Black African and Indian. The idea behind BBBEE, however, is to properly and conveniently distribute the wealth amongst a broader spectrum of individuals who were previously disadvantaged.
Verification as well as BBBEE Certification
Currently, it is not practically mandatory to get a specific agency to perform an audit on the BEE scorecard. However, it is an actual requirement in order to have appropriate documentation in order to be able to score points. The SANAS as it is more commonly referred to has been mandated to be the scoring and verification agency alongside IRBA. This has been instituted so that there could be stability of the proper verification when it comes to BBBEE contributions. The necessary certificates can actually be released by any other verification agency. However, in order for this to happen, they need to be properly approved by IRBA or by SANAS. Accounting officers who have been officially registered as per the Act of Close Corporation of 1984 are also capable of issuing BBBEE certificates.
The Size of the Enterprise and Its Effect on BBBEE
As stipulated in the Act 53 promulgated in 2003 – the Codes of Good Practice for Black Economic Empowerment, all of the companies in SA are thoroughly divided amongst three different categories which include:
- Generic enterprises which have a turnover over R50 million
- Small enterprises which have a turnover ranging from R10 million to R50 million
- Micro enterprises which have turnover which is less than R10 million
It is important to note that each of the aforementioned categories is subjected to different and particularly characteristic sets of criteria for the measurement when it comes to BBBEE.
This is why it’s important to take all things into thorough consideration. The concept behind this is rather beneficial, but the implementation of the policies and the strategies needs to be carried out thoroughly and with great responsibility. The empowerment of previously disadvantaged individuals needs to be addressed carefully by taking the necessary metrics into proper account.