A transactional strategy often prioritises short-term gains and superficial compliance, whereas a transformational approach involves a deeper, more holistic transformation of an organisation’s DNA.
By aligning initiatives with the broader goals of the B-BBEE scorecard, companies can foster lasting change that transcends mere tokenism, writes Yuneal Padayachy, chief support officer at the BEE Chamber.
In my extensive experience within the Broad-Based Black Economic Empowerment (B-BBEE) industry, I have witnessed a notable uptick in organisations transitioning from a Transactional mindset to a Transformational ethos when formulating their B-BBEE strategies. This shift signifies a positive trend towards integrating empowerment initiatives that go beyond ticking boxes, ultimately benefiting both businesses and the broader economy.
Unpacking the crucial distinction between Transactional and Transformational B-BBEE strategies, there is a significance of moving beyond mere compliance towards fostering genuine, impactful changes within organisations. The B-BBEE environment is evolving and the shift towards more sustainable and inclusive practices are needed.
Drawing a clear distinction between the two approaches, a Transactional strategy often prioritises short-term gains and superficial compliance, whereas a Transformational approach involves a deeper, more holistic transformation of an organisation’s DNA. By aligning initiatives with the broader goals of the B-BBEE Scorecard, companies can foster lasting change that transcends mere tokenism.
Despite the challenges that we face, particularly around the Legal B-BBEE Sector Codes of Good Practice, we should not lose sight of why we have B-BBEE Legislation and the objectives we are trying to achieve as a country.
At the BEE Chamber we have always emphasised the imperative need for organisations to adopt a transformative approach to B-BBEE as this is what it means to us.
As we move swiftly into 2025, the BEE Chamber is excited to see the transformative role played by the public and private sector that will have an impact on our country.
- A transformational approach – As stated, this approach means an organisation’s focus is on changing its internal DNA. Consideration should be on what a transformed organisational DNA will mean for the business and the economy at large. Based on the desired outcome, an organisation must evaluate the scorecard they are measured on then decide what initiatives will support the end goal. Using the B-BBEE Scorecard as a benchmark of transformation, as opposed to the end goal itself – the points on a B-BBEE Scorecard will organically lead to a transformational approach.
- A transactional approach – Applying a transactional approach means an organisation focuses on the points they can earn, not considering what impact it will have on its internal DNA and beneficiaries. The focus is on circumvention, a minimal investment in people and quick-fix solutions. Thus, it creates an illusion of transformation with no long-term benefit that is sustainable. Organisations applying this approach generally return to the B-BBEE drawing board annually to rehash another transactional approach with no tangible return on their investment.
Despite the strides made in promoting transformational B-BBEE practices, challenges persist. We acknowledged the prevalence of tenderpreneurs, blatant circumvention or not willing to walk the path of B-BBEE Transformation and profit-driven schemes that undermine the true intent of B-BBEE legislation and what we are trying to achieve as a country.
Reflecting on the negative perceptions surrounding B-BBEE, we need to debunk myths linking the policy to corruption rather emphasising that corruption has no relation to race, and meaningful transformation is essential for our country’s progress.
Looking ahead to the future, we are optimistic for a paradigm shift towards sustainable B-BBEE practices that have become ingrained in the fabric of businesses. We would like to urge decision-makers across sectors to embrace their role as enablers of growth and champions of economic inclusivity, they play a pivotal role in shaping a more equitable and prosperous society.
As the BEE Chamber continues to advocate for excellence in B-BBEE implementation, the call for a collective commitment to economic transformation resonates as a national imperative. With a focus on building internal capacity and fostering a culture of continuous engagement, the BEE Chamber stands at the forefront of empowering organisations to drive impactful change and enable the participation of all South Africans in the economic mainstream with a specific focus on black people.