GOODBYE BEE
- BEE NEWS
- 2 days ago
- 4 min read
Shaun Jacobs | 10 March 2026
Efficient Group chief economist Dawie Roodt believes that the creation of the Transformation Fund will be the end of Black Economic Empowerment (BEE) as it is currently devised in South Africa.
BEE will not disappear entirely, but the way in which companies comply with the regulatory framework will fundamentally change.
Companies, through the Transformation Fund, will be able to effectively “buy” their BEE compliance rather than have to go through the current process of identifying their own enterprise and supplier development beneficiaries.
This has the potential to make BEE compliance far more efficient and less burdensome, making investing in South Africa more attractive and making companies more productive.
“I think this is the end of BEE in South Africa. You know what is going to result in the end of BEE? The creation of the Transformation Fund,” Roodt told State of the Nation.
“In future, companies are going to ‘buy’ their BEE by giving money to this fund and this is going to become the alternative to current processes.”
Roodt explained that the logical conclusion of this process is the end of BEE as a policy framework, with it being replaced by the far simpler alternative of giving money to the government to redistribute.
“The Transformation Fund is a far more attractive alternative. It is simply another tax. So, you can forget about BEE and filling in forms, you are just going to pay money to the fund and forget about it,” Roodt explained.
“That is going to lead to the official BEE coming to an end with its elaborate processes, compliance, and forms.”
Under draft changes to South Africa’s BEE codes, proposed by Minister of Trade, Parks Tau, businesses will be able to score more BEE points by contributing to the fund than by making individual contributions to black-controlled companies.
The proposal is to increase the total points businesses can score in the Enterprise and Supplier Development element from 46 to 53, including bonus points, if they contribute to the fund.
ANC open to changing BEE
Roodt has also pointed to statements from members of the government, including the President, as evidence that BEE is changing in front of everyone’s eyes.
The ANC has historically not been open to even debating the merits of BEE, with changes to the policy framework almost being unimaginable.
However, in recent years, the party’s transformation agenda has come under increasing scrutiny, with it being increasingly associated with cronyism and corruption.
Criticism has ranged from political parties, such as the DA, to business leaders, such as Investec CEO Fani Titi.
US President Donald Trump and his administration have also weighed in, allegedly making the scrapping of BEE a requirement for a trade deal to be signed between South Africa and the United States.
A study from the Institute for Justice and Reconciliation found that more than half of South Africans want BEE phased out.
Despite this criticism, the ANC has said it remains committed to its transformation policies, with it saying that it will double down on BEE in South Africa.
The policy framework, however, has been called into question by its own members, who occupy high-ranking positions within the party and the government.
During his State of the Nation Address, President Ramaphosa said the government is undertaking a review to refine, realign, and strengthen its BEE framework.
This is ostensibly to ensure that the framework supports greater transformation and inclusive growth, but it is also an admission that it has not achieved its aims.
Tau has explained how the review of BEE will be conducted and outlined some of the changes that could be made as a result of it.
“The review will be implemented in two phases. The first phase will be a short-term review focusing on refinement and an analysis of subordinate legislation, which should be completed by the end of this financial year,” Tau told Parliament.
“Parallel to that, we have been in the process of consultation to finalise the Transformation Fund, and the implementation of the fund is part of the review process.”
“The second phase is a long-term review which involves an analysis of the Broad-Based Black Economic Empowerment (B-BBEE) Act for substantive amendments.”
Perhaps the most revealing admission from a high-ranking ANC member came from Finance Minister Enoch Godongwana, who said the policy should be open for honest debate.
“We must have an honest debate about BEE. But, first and foremost, it is a constitutional imperative. You cannot dismiss BEE as it is required by the Constitution,” Godongwana said.
“What we need to ask is whether there are any unintended consequences. You can’t say ‘Do away with BEE.’ Are there any unintended consequences?”
Godongwana said the debate around BEE must focus on the policy’s efficacy and whether it is actually driving the empowerment of black individuals in South Africa.
“If the debate starts there, it can start from an objective basis of analysing some of the unintended consequences, and then we can have a constructive discussion,” he said.
“The discussion at the moment is an ideological attack more than an objective analysis of its efficacy. Let’s move away from the ideological attacks on BEE.”
“Let’s go into the practicalities of analysing what some of the effects are which were not intended by the framework.”
‘Disclaimer - The views and opinions expressed in this article are those of the author(s) and not necessarily those of the BEE CHAMBER’.