Tag: marxism

ANTHONY BUTLER: Consensus about BEE policy needs to emerge

First published in Business Day

12 September 2025

The contentious debate about broad-based BEE (BBBEE) has been a real problem for the country. If coalition government between constitutionalist parties is to survive the next decade, some rudimentary consensus about the policy needs to emerge.

Until recently the polarisation has been deepening. BEE’s defenders insist it has created a black capitalist class, black managers and professionals who would otherwise have remained excluded. It has also brought changes in employment equity, skills development and enterprise support.

President Cyril Ramaphosa has always championed the framework he helped create and from which he benefited so handsomely. He has rebutted claims that BEE hinders growth, framing it as an investment in the economy, not a cost. He has strongly backed the Black Industrialists Programme and a proposed R100bn Transformation Fund to bolster black entrepreneurs. Last year he supported legislation to reinforce compliance through enhanced incentives and possible punitive measures such as fines and public “naming and shaming”.

The president’s only real accommodation of critics has been support for the Equity Equivalent Investment Programme, which allows multinationals to invest in skills, innovation and supplier development rather than transferring equity directly.

BEE has meanwhile faced intensifying criticism from opposition parties, businesses and civil society, who argue that the main beneficiaries have been a politically connected, ANC-linked elite rather than ordinary black citizens. It has been a mechanism for patronage, with state contracts channelled to politically connected business people under the guise of empowerment. BBBEE has also been weaponised to justify corrupt procurement practices.

The DA’s hostility has hardened. The party rejects race-based legislation and proposes instead a nonracial economic empowerment framework with a “social impact” approach to integrate sustainable development goals into procurement and other regulatory frameworks, and an “economic empowerment for the disadvantaged” model to target poverty rather than race. An empowerment index for companies would meanwhile measure their social and economic inclusivity to mobilise shareholder activists.

Civil society actors want to replace elite enrichment with broad-based, skills-driven, employment-generating empowerment, by prioritising employee share ownership schemes, community trusts and co-operatives over elite ownership deals, and linking state support and contracts to demonstrable worker and community benefits.

There has also been renewed interest in ordinary citizen investment in stock markets through their pension or investment policies, in carefully designed retirement schemes that encourage saving, in expanded home ownership, and in reducing the barriers to entry that shut out the small, medium and micro enterprises that are the most immediate mechanisms of economic empowerment for most people.

Some of the dwindling band of ANC intellectuals have been influenced by Malaysia’s recent rethink of indigenous empowerment. Its new road map for economic transformation for the bumiputera (sons of the soil) refocuses on upskilling and mentoring of particular individuals, helping smaller enterprises move up the value chain, and giving empowerment agencies dedicated roles as talent developers or “super-scalers” of businesses — with measurable outcome targets, rather than broad objectives or mere compliance metrics.

The ANC’s recently released discussion documents for December’s national general council (NGC) show a flickering — if not yet a significant uptick — of the liberation movement’s formerly flatlining cognitive functioning charts in this area. The NGC “base document” concedes that BEE has primarily incorporated an elite minority of black people, and a few women, into the existing capitalist structure.

It insists that empowerment policies must be “reoriented to benefit more than an just elite few”, and suggests employee ownership trusts and co-operatives, better support for small, black-owned businesses, a public venture capital fund or credit-guarantee scheme, and BEE incentives linked directly to actual job creation.

What is needed is a bit more academic research and an open mind on all sides about potential change. A broad consensus on the way forward might conceivably yet be forged. But don’t bet on it.

• Butler teaches public policy at the University of Cape Town.