Monday, September 12, 2005

Small Business: Some South African businesses fake black empowerment

South African businesses must comply with Black Economic Empowerment (BEE) regulations which state that some ownership and a specified number of jobs and contracts, must be reserved for the black population.

However, some smaller companies have been "faking blackness," and South African media have reported that many exploit unskilled labor. One company listed a black woman, who sells sweets, cool drinks and cakes from a backyard room, as a 49 percent shareholder in the company.

South African authorities have announced they intend to clamp on down on such fraud, and I would be happy to suggest where they should put the clamps.