There are detractors and supporters for South Africa’s BEE.
What is BEE?
In a South African context, BEE stands for Black Economic Empowerment. Now formally known as Broad-Based Black Economic Empowerment (B-BBEE), it is a government policy and legislative framework designed to address the economic inequalities inherited from the Apartheid era.
The primary goal of BEE is to increase the participation of “black people”—defined as Africans, Coloureds, Indians, and Chinese South Africans who were citizens before April 27, 1994—in the national economy.
Why the Backlash?
The concern about BEE in it’s present state is that is has no end goal. What is the mechanism or goal to achieve that will signify that BEE has doene what it set out to do?
Frankly – the complicated system of points and moving goals along with a very loose interpretation of just what it means to be black are the stumbling blocks to what is, frankly, a necessary programme.
Why is BEE Failing?
Where the programme failed was in defining it’s end.
As of January 2026, there is no legislated end date or “sunset clause” for the Broad-Based Black Economic Empowerment (B-BBEE) programme in South Africa. The governing African National Congress (ANC) and President Cyril Ramaphosa have repeatedly affirmed that the policy is “here to stay” and is a permanent constitutional imperative for redress.
The compliance responsibility is slowly being shifted and the focus in 2026 is shifting from “compliance documentation” (paperwork) to “measurable outcomes,” requiring companies to provide clearer proof of actual economic impact on black beneficiaries.
Estimates suggest that since 1994, approximately R1 trillion in value has been transferred to fewer than 100 individuals through repeated empowerment deals.
Instead of creating a wide base of new entrepreneurs, the same high-profile “tenderpreneurs” often secure multiple large-scale contracts and ownership stakes.
As of the last quarter of 2024, the black unemployment rate stood at 35.8%, while the white unemployment rate was 8.1%. Over the last decade, black unemployment increased by nine percentage points while white unemployment decreased by one point.
Multinational corporations often struggle to reconcile BEE ownership requirements with their global structures, leading some to bypass South Africa for more business-friendly emerging markets.
What is the Solution?
Opposition parties and some civil groups are calling for BEE to be replaced with needs-based or means-based redistribution policies that target poverty directly rather than using race as the sole proxy.
What is Alan’s ‘Better Solution’?
The BEE programme should simply target all those individuals who did not have the vote prior to 1994.
A simple programme that will remind every citizen of their rights to vote and offer them redress based on their disenfranchisment.
In the context of Apartheid (1948–1994), “disenfranchisement” describes the systematic, legal removal of voting rights from non-white South Africans to ensure total political control by the white minority.
By targeting the disenfranchised only and not a racial group per se we would have:
- Shown redress to those who had been disenfranchised
- Offered a real chance at nation building
- Created a programme of redress with a real and tangible end of life.
Concerns:
The above programme would create a dwindling pool of geuinely disenfranchised persons for businesses to score points off of so that may create a ‘bidding market’.
There are just so many businesses needing BEE points so one would have to add in a mechanism that restricts the number of BEE (DEE?) businesses that one individual may hold shares in or a senior position in.
Most other systems of redress involves some form of management intervention to ascertain whether the individual qualifies for redress – financial means test, low interest loans to qualifying persons, affirmative action, job reservation etc.
I think that South Africa’s system – if based on date of birth – would be a manageable and, more importantly, more palatable system to all.
The simple means test would be; “Were you born before 26 April 1994 and did you qualify to vote in any South African election?” Yes means you qualify and No means you don’t.
No pencil tests, apartheid spys, skin color debates, facial feature examinations, home language tests (specifically knowledge of Afrikaans), socioeconomic status determinations, or even eating and drinking habits or stuff like that to determine whether one was White, Black, Coloured, Indian or Asian.
