5 May 2010
Just over 60% of South African privately held business owners believe that black economic empowerment is an important factor in terms of winning new business, Grant Thornton’s 2010 International Business Report finds, with companies preferring to fast-track key employees and develop existing staff to achieve empowerment targets.
The figure of 61% has remained fairly constant since 2008 (59%) and just 2% down since 2009 (63%).
When the South African data is assessed regionally, it is interesting to note that BEE is far less of an issue in KwaZulu-Natal (53%) in terms of winning business, while Eastern Cape (66%), Gauteng (65%) and Western Cape (61%) rank BEE as an imperative.
“The past 36 months have seen a similar level of attention on broad-based BEE implementation with most [privately held business] owners citing the issue as important,” said Grant Thornton’s Tony Balshaw in a statement this week.
“However, we believe that surviving the tough economic conditions was the primary focus in most companies over the past 18 months, rather than businesses giving specific attention to the [empowerment] codes.”
Empowerment scorecard rating
When asked to rate the importance of each element of the empowerment scorecard to their business, skills development (48%), employment equity (39%) and management (36%) were ranked the highest.
The elements of ownership (35%), socio-economic development (34%), followed closely behind, with preferential procurement (31%) and enterprise development (27%) being cited as the least important factor in the empowerment scorecard, in terms of privately held business practice.
“Whilst the [empowerment codes] have been operational for more than three years, the public sector have yet to harmonise their procurement policies, contained in the Preferential Procurement Policy Framework Act, with the B-BBEE Codes of Good Practice,” said Balshaw.
“We think the broader issues are more important going forward to attaining broader empowerment in our nation, than the narrow-based elements of pure ownership and management.”
Internal staff development
In order to achieve corporate BEE targets, South African business owners believe that developing people internally (77%) and fast tracking key employees (61%) are the most beneficial strategies to implement.
“Owners also turn to socio-economic development initiatives (58%) in an effort to improve their [empowerment] score,” said Balshaw.
“Procurement policies are a powerful tactic too, in this regard, with 54% of business owners in South Africa agreeing that procurement from suppliers with certified procurement recognition levels play a vital role in ensuring businesses achieve targets set by the codes.”
Grant Thornton’s 2010 International Business Report surveyed over 7 400 privately held business owners from across 36 economies.
SAinfo reporter
Would you like to use this article in your publication or on your website? See: Using SAinfo material
