ASSISTING black entrepreneurs to grow their small andmediumenterprises (SMEs) is infinitely more important than selling a stake of a business to a black partner.
This is the advice of Keith Levenstein, CEO of leading Black Economic Empowerment (BEE) consulting specialist EconoBEE. He said that in many cases, the “empowerment partner” is only a passive stakeholder in the business.
Speaking at a conference in Durban on how to maximise BEE scorecard points through procurement and enterprise development, Levenstein said enterprise development holds the key tomeaningful empowerment.
He told The Witness that this can be achieved through another of the seven B-BBEE (Broad-based black economic empowerment) codes, namely preferential procurement. The codes are ownership, management, employment equity, skills development, preferential procurement, enterprise development and corporate social investment.
Enterprise development can take many forms, including financing black-owned businesses and external skills development and training.
Levenstein said that in an ideal world, the ownership challenge can be addressed by starting with internal skills development.
“It startswith training. Staffmembers then eventually move up the ranks. Black junior managers can thenmove intomiddle andseniorpositions. Fromhere, they can develop themselves to a pointwhere they can buy a stake in the business … and that is one way for the ownership issue to be solved.”
Levenstein lamented the fact that the burning B-BBEE issue for most companies is securing a good BBBEE scorecard and little else.