BBBEE Act
Before we explain the four pillars of BBBEE, we need to know what is BBBEE. BBBEE or Broad-Based Black Economic Empowerment (BBBEE) is a strategy to ensure the participation of black people in the South African economy. In 2003, BBBEE was introduced firstly through BBBEE Act.
Four Pillars of BBBEE
BBBEE has a standard to measure the organizations or companies in order to comply with the BBBEE value or called pillars. BBBEE previously had seven pillars. The old pillars are:
- Ownership,
- Management Control,
- Employment Equity,
- Skills development,
- Preferential Procurement,
- Enterprise development, and
- Socio-Economic Development (Social Responsibility).
In the journey of the BBBEE, the committee has changed the seven pillars and minimized them to only five pillars of BBBEE. Then, from five pillars reduced to four pillars a few years ago.
Here are four pillars of BBBEE that you need to know.
1. Ownership
The portion ownership of the company determines the level of the company in this BBBEE system. For example, a company with 100% black-owned has a turnover of under R10 million and will be categorized to be level one of BBBEE status. Then, a company owned by more than 51% of black people will be a level two of BBBEE status.
2. Management Control
Management control is the number two of four pillars of BBBEE. In this pillar, there are 15 BBBEE points to get attention.
3. Skills Development
Skills development is the three of four pillars that are very important to empower human development and quality of life for South African. Companies are encouraged to give training, apprenticeship, internship, learnership, and any other skill development programs to the unemployed and youth South African. encompasses the development of staff members as well as the granting of learnerships to unemployed individuals. Companies that conduct this kind of skill development program will be granted additional points.
4. Enterprise and Supplier Development
The last of four pillars of BBBEE is enterprise and supplier development. This pillar has significant points to pump the points of the BBBEE scorecard.
If you have a company and want to easily get tenders or projects from the government or any other institutions, you need to have high points of the level of BBBEE.