The recent critique by Professor William Gumede that over R1 trillion has been “transferred” under Black Economic Empowerment (BEE) to fewer than 100 politically connected individuals is a sobering wake-up call.
It is a critique we cannot afford to ignore. But neither can we afford to allow this critique to be weaponised by those who have always opposed transformation, to delegitimise the very idea of economic justice in post-apartheid South Africa.
Let me be clear: BEE, as it has been implemented in too many cases, has failed to meet the aspirations of the majority.
Gumede is right to point to the recycling of beneficiaries, the political gatekeeping, and the elite capture of empowerment deals. But he is wrong, dangerously wrong, if his insight is used to argue for scrapping BEE altogether.
We must ask ourselves: who benefits when BEE is destroyed instead of reformed?
Certainly not the millions of unemployed black youth in townships and rural villages. Not the historically disadvantaged communities who still lack access to capital, land, and markets. And not the African, Indian and Coloured women who remain structurally excluded from the mainstream economy.
The idea that “BEE is the biggest scam in post-apartheid SA” dangerously distracts from the real structural crisis: the continued racial and gendered concentration of wealth.
Here are the facts: 8 of the top 10 richest South Africans remain white men. Over 70% of agricultural land remains under white ownership. Access to venture capital, export markets, and finance remains racially skewed.
It is ironic that the same voices calling BEE “racist” rarely propose solutions to white economic over-representation.
The only ones who benefit from the collapse of BEE are those who were never in favour of transformation in the first place the economic oligarchs who would be thrilled to return to a status quo of white dominance wrapped in the language of meritocracy.
Despite limitations, BEE is not a failure:
- Over 6 million black South Africans now hold direct or indirect ownership in companies through broad-based share schemes (e.g. MTN Zakhele, SASOL Inzalo, Phuthuma Nathi at MultiChoice).
- Black ownership on the JSE has grown from less than 1% in 1994 to an estimated 25–30% today (direct + indirect via funds and B-BBEE schemes).
- Over 50,000 black-owned SMEs have been supported via enterprise and supplier development obligations.
- BEE has enabled the creation of black industrialists, catalysed youth training schemes, and expanded procurement access.
The BEE scorecard includes ownership, skills development, employment equity, socio-economic development, and procurement. It is a multidimensional framework, not simply elite enrichment. However now that we know better , we must do better.
Acknowledge the Failures, But Don’t Abandon the Mission
As a former Member of Parliament and lifelong activist for social and economic justice, I have seen first-hand how some BEE deals were little more than rent-seeking schemes. Politically connected figures often acted as fronts for white capital, offering legitimacy without empowerment. These are not just moral failings they are strategic betrayals of the people.
But the answer is not abandonment. It is reform, accountability, and reorientation toward true broad-based empowerment. We must ask: What models have worked? What does inclusive, community-rooted BEE look like? And how do we ensure that BEE no longer becomes a revolving door for the same elite, but instead a ladder for the many?
What Broad-Based Empowerment Really Looks Like
The idea of broad-based empowerment is not hypothetical. I have checked ,it actually exists though often drowned out by the noise of scandal. Let us spotlight real, replicable models that show us what is possible.
1. Sasol Inzalo Trust (2011) – R26 Billion Empowerment for the Public
One of the largest and most ambitious empowerment transactions in South African history. Over 200,000 South Africans from nurses to pensioners acquired shares in Sasol via the Inzalo Trust. This was not an elite project, but a mass participation vehicle offering dividends, ownership, and dignity.
Yes, the deal had flaws (especially when Sasol’s share price dropped), but the intent and structure were inclusive. We must learn from and build on this.
2. Absa Employee and CSI Trust (2023) – A New Vision for BEE
In 2023, Absa created a model that should become the new gold standard. It allocated 7% of its ownership to: 3% for over 35,000 employees; 4% to a Community Trust focused on healthcare, education, and township upliftment.
This is real empowerment linking productivity with ownership, and profit with community reinvestment.
3. PepsiCo / SimbPioneer Foods (2020) – Worker Trust
PepsiCo’s merger with Pioneer Foods resulted in a R1.66 billion worker trust benefiting over 12,000 employees 90% of whom are black. It wasn’t politically brokered. It was structurally designed to include workers at scale.
4. Heineken’s “Bokamoso” Trust (2021)
When Heineken acquired Distell, it was required by the Competition Tribunal to create a broad-based employee share scheme. “Bokamoso” gave 6% equity to workers a model where empowerment was made a regulatory condition of doing business in South Africa.
These are not isolated cases. They are models for the future evidence that BEE can work, and work for the people. Why can the JSE Top 100 Listed Companies not follow this and give shares to their workers, their customers and communities they serve?
B-BBEE That Serves the Nation, Not the Network
For BEE to be legitimate, it must:
- Stop recycling elites: No individual or consortium should benefit from more than one major BEE deal.
- Impose sunset clauses: Empowerment credentials must expire after a certain period.
- Create a National BEE Beneficiary Registry: All deals and beneficiaries must be publicly disclosed and tracked.
- Mandate community participation: At least 30% of all future equity deals must be routed through community trusts, worker funds, and township co-operatives.
- Align with the District Development Model: BEE must build local economies not extract value from them.
We must turn BEE into a mechanism for building black productive capacity, not just redistributing shares. That means more funding for black industrialists, township-based manufacturing, rural cooperatives, and tech-enabled youth entrepreneurship.
A Call to Action: Reclaim Empowerment from the Few, for the Many
To comrades, policymakers, business leaders, and community activists: we are at a crossroads. Either we allow the failures of the past to paralyse us or we reclaim the transformative promise of BEE and remake it to serve all who were historically disadvantaged: Black Africans, Coloured South Africans, Indian South Africans, women, youth, people with disabilities, and the rural poor.
I call on the ANC to:
- Codify a new generation of community-based empowerment deals
- Reject individual-based enrichment without public impact
- Strengthen the oversight powers of the B-BBEE Commission
- Incentivise cooperatives, worker-ownership, and community reinvestment
We must restore the moral authority of economic redress by placing THE PEOPLE not political patrons at the centre of empowerment.
Conclusion: Build, Don’t Burn
Professor Gumede has done us a service by exposing what went wrong. But let us not allow this moment to be hijacked by reactionaries who wish to dismantle BEE altogether. Let us not abandon the house of transformation because the roof leaked.
Instead, let us rebuild it, repair it, and expand it, so that it shelters all South Africans who have for too long lived on the margins.
We don’t need to scrap BEE. We need to liberate it from the few and make it finally work for the many.
That is the real empowerment and economic justice we must fight and struggle for.
This opinion piece was first published in ANC Today
* Faiez Jacobs is a former MP, Public Policy Strategist and Advocate for Economic Justice
** The views expressed do not necessarily reflect the views of , Independent Media or The African.
