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10 Years In, South African Affirmative Action Faces Criticism

FILE - Shoppers walk into a Woolworths store at a shopping center in Lenasia, south of Johannesburg, August 2013.

FILE - Shoppers walk into a Woolworths store at a shopping center in Lenasia, south of Johannesburg, August 2013.

South Africa is observing the 10th anniversary of the law that brought affirmative action to the workplace for black South Africans. The Black Economic Empowerment law - commonly known as BEE - was meant to redress decades of inequality by implementing quotas for black workers in South African companies. Ten years later, however, the policy has its share of critics.

"Hi, how are you? Let's quickly run through the plan. We're gonna start with ownership."

Every year, Thabo Mokoena goes through the same audit. He meets with an agent of a certification agency who is going to assess how many points the company he works for has scored regarding the Black Economic Empowerment policy, commonly known as BEE.

Points are based on the percentage of blacks and other non-white ethnic groups in the company's ownership and the skills training it gives to people in these groups.

Mokoena said the policy is not hard to implement if you believe in it.

"It's not complicated if you subscribe to it philosophically. Obviously it does have challenges, in the sense that you do have to place people in the job categories are required, you have to set aside the sufficient financial resources to do the training, and so on and so forth," he said. "Any company that is faced with a situation, if philosophically, they're in agreement with the objectives of the legislation, it's not difficult, but there will be challenges in implementation and there'll be cost involved."

The first BEE act took effect 10 years ago, with the goal of addressing inequalities created during decades of white-minority rule. Back then, non-whites were excluded from many jobs.

For companies, having a good BEE scorecard is often essential for business. The higher the BEE score they have, the more access they get to public markets and contracts.

Pansy Morapedi, managing director of the certification agency Honeycomb, said that although there are clients that embrace the philosophy of the BEE, most of them do it for the business opportunities it creates.

"It is still a grade purchase, for a lot of companies. For them to be able to do business, they require a BEE certificate. I mean it's like buying insurance. You sort of don't want to buy insurance, but you need it. But we do also find that in our client base we do find clients that are actually embracing the law for what it is: to transform the country."

But the policy has faced various criticisms over the years. During a summit last month, South African President Jacob Zuma pointed out that fraud remains a problem. The practice of "fronting," in which companies appoint black people as token shareholders to get a higher BEE score, is common.

Some say BEE also has deterred black entrepreneurship and has given black South Africans a sense of entitlement.

Boitumelo Sethlatswe, a researcher at the South African Institute Of Race Relations, said, paradoxically, BEE sometimes does not help black people.

"It pushes stereotypes about black people. Because there is such a high demand to get people of color into positions that, given our past, you might not have the numbers of educated people to fill positions that were currently available," said Sethlatswe. "I think in some cases, people might not recognize that that person who's sitting in the boardroom is competent."

Sethlatswe said the BEE should be combined with other strong policies in order to work.

"If we're trying to transform the country, rather than focusing on making sure that there are quotas in place, we should rather focus on economic growth, on education, on entrepreneurship. We need to make sure that we put other things with these policies in order to support them," said Sethlatswe.

Last month, new reforms were announced regarding the BEE. Tougher sanctions toward the practice of fronting and an emphasis on black ownership are among other measures designed to improve the policy.