In this compelling opinion piece, Donald MacKay and Daan Steenkamp critically examine the long-standing economic impact of Broad-Based Black Economic Empowerment (B-BBEE) in South Africa. Drawing on recent empirical research, the authors argue that the cumulative costs associated with B-BBEE compliance have created significant drag on firm-level productivity and overall economic efficiency. They posit that the regulatory burden, coupled with market distortions, has increasingly outweighed the intended socio-economic benefits, hindering rather than fostering sustainable transformation.
MacKay and Steenkamp challenge the status quo, suggesting that the current framework acts as a constraint on growth and capital investment. By analysing the interplay between compliance costs, operational decision-making, and market competitiveness, the authors present a robust case for policy re-evaluation. Their contribution serves as a vital call to action for policymakers to design more effective, growth-oriented mechanisms that achieve genuine economic inclusion without compromising the broader health of the South African economy.
