Strategies, challenges and best practices in implementing black economic empowerment in selected South African companies

Abstract

This study presents an exploration of the challenges, strategies, and best practices in implementing Black Economic Empowerment within selected organisations in South Africa. The practise of Broad Based Black Economic Empowerment (BBBEE) within industry aims to provide redress for the imbalances of the apartheid era with the support of businesses. The focus area for this study is centred around the organizational implementation of BEE, which has become an unavoidable imperative for many South African companies if they wish to maintain long term profitability (Business Map, 2005). The challenge that arises is that, BEE legislation is not mandatory for the private sector, and businesses have no legal obligation to comply with it should they wish not to. This allows room for organisations to decide whether BEE will be profitable for the business or not and therefore, some organisations are hesitant and/or too slow to implement BEE, and hence, the pace of BEE compliancy is further questioned. The priorities and responsibilities of management in driving BEE, as well as the challenges, strategies, and best practices in implementing it, were investigated through this study, using both quantitative and qualitative methodologies. To achieve the objectives of the study, a survey using questionnaires and interviews was adopted. Questionnaires were administered to organisations on the 2018 Empowerdex List of Top 100 Companies and twenty of the respondents were selected for interviews. The findings from the study showed that the government and BEE consultants can support organisations with BEE implementation. Various departments must be accountable for successful BEE implementation together with the sound guidance of managers and ethical leadership for genuine transformation. Whilst various challenges were noted, strategies and best practices area also noted for successful BEE implementation. Based on the findings, a BEE Implementation Framework based on best practice was developed to assist South African businesses with their BEE implementation. The study is of significance to South African organisations, particularly those engaged in BEE implementation, government and academics who are exploring development and transformation within South African organisations.