Overview of the policy and institutional landscape for enterprise development and preferential procurement in South Africa

The South African policy and institutional landscape for preferential procurement and enterprise development are summarised in this document, with a specific focus on the use of these two BBBEE Code elements in broader socio-economic development. An analysis of the various Acts, government strategies and policies, and industry sector charters all reveal a common goal for the upliftment of previously disadvantaged individuals and their empowerment through meaningful participation in the South African economy. Whilst numerous and diverse, the frameworks which are meant to provide support for enterprise development and preferential procurement, also have the potential to create confusion. The overview has revealed various gaps and/or barriers to the full understanding, implementation and achievement of the socio-economic goals. The lack of linkages between the frameworks regarding how they support each other, and how they can ease the implementation of initiatives to support development goals, is evident. Specifically, guidelines on how enterprise development and preferential procurement can be achieved in private sector industries are also lacking. Importantly, the private sector needs to view transformation as a sound business case as opposed to a compliance requirement. From a developing enterprise perspective, regulatory and compliance requirements that impede growth and job creation and result in other negative unintended consequences should be addressed to ease the attainment of socio-economic goals. Initiatives also need to encompass strategies sensitive to the needs of women and people living with disabilities.