The resilience and posture of black business


Monde Ndlovu | Head | Advocacy and Thought Leadership | Black Management Forum (BMF) | mail me

South Africa is limp wristed from unclear definitions and objectives that are used at different moments to drive ambiguous agendas. South Africa lacks a clear definition for transformation, and thus every other organ of change abdicates their role in shaping the country in a progressive direction.

This is the proposed definition that incorporates three facets of transformation: transformation as a science, seeks to measure the progress of black people in terms of their socio-economic prosperity in a democratic dispensation.

Defining transformation

Transformation as a craft, seeks to create policies and frameworks that will drive the inclusion of black people into the mainstream economy.

Transformation as an art, seeks to deal with the mindset of society around creating a new society, which is fundamentally distinct from what was there prior to transformation efforts. Building it from the ground up and focusing on values and principles.

Therefore, black business has a particular role to play in fusing the scientific, the craft and artistic perspectives of transformation in the South African economy.

This definition should be adopted by black business, black lobby groups, government, labour and civil society, and should become the DNA of every conference, discussion, engagement, and policy submission in South Africa.

The storm of pandemics

Black business over the years in South Africa has faced insurmountable odds and challenges against them.

Apartheid was a moral pandemic, driven by separate development and under-development of black people in general. This, however, did not stop black business from emerging, instead, subjugation and oppression developed resilience in black people, propelling them to build black business in townships and driving an intellectual revolt against Corporate South Africa.

The Kunene Brothers, Dr Nthato Motlana, Dr Richard Maponya, Dr Donald Mkhwanazi, Dr Lot Ndlovu and Dr Reuel Khoza, are but a few names that towered the notion that black people can self-actualise and build black led business in South Africa.

This movement of black business during apartheid grew in leaps and bounds within the black community and the economic aspirations of black people resonated with hope that became palpable and inspired many to join the onslaught against apartheid in this regard.

COVID-19 has been another challenge for black business to overcome and fight to remain relevant in producing goods and services for customers and maintaining the balance of expectations among stakeholders.

COVID-19 has exposed the slow pace of transformation in South Africa, and the stark realities of black business.

The four challenges that South Africa faces in the form of poverty, inequality, unemployment and leadership remain largely a black challenge.

According to the recently released Quarterly Labour Force Survey Report, Q2 2020 by Statistics South Africa, the black African population group has a higher unemployment rate than the national average sitting at 26.3% and the national average at 23.3%.

The white population group unemployment rate is sitting at 6.1% according to the same report. In a country that has 39 million people of working age, 14.1 million are employed in South Africa per the same report.

COVID-19 has just amplified the existing realities in the main and raised the alarm on the low number of employed South Africans who are carrying the whole country in terms of income tax and spending.

Black business in the same period has seen the continued challenges of cash flow, late payments and in some cases no payment at all.

Black business also does not compete on equal footing with established white business, for they cannot implore economies of scale and negotiate pricing without making a substantive loss.

These acute challenges cripple the possibility of growing business and increasing the employment base. This has largely contributed to the prevailing business mindset of employing few employees and maximising on profit, to create cash flow for the owners or owner.

Black business in South Africa therefore has a fundamentally different attitude towards building business, this mindset is driven by the broader societal challenges and black people in large numbers start businesses to survive and not to grow the economy.

Building black capital

Firstly, in building black business in South Africa, the focus needs to be on strengthening policy and consider lobbying for a BBBEE Ombudsman office, that will focus on creating value for black business on the JSE and in the unlisted space. The Intellidex report of 2015 on the Value of BEE Deals on the JSE reflects value of R317 billion gross before tax was created through BEE transactions.

Secondly, focus on the banking and financial services sectors, for these sectors are the bedrock of the economy. This focus should drive the commercial banks to fund a black owned bank through their BBBEE scorecard on enterprise development.

Thirdly, black business to regroup and strengthen the Black Business Council, in being the solemn voice of black business in South Africa.

Fourthly, lobby for the introduction of empowerment quotas with punitive measures for non-compliance. These quotas should focus on business finance and procurement spending by the private sector. To review the mandates of all development finance institutions and align them to focus on black business development.

Fifthly, to lobby for a Black Business Act, that will focus on developing black business in key sectors of the economy and define the start-up and SMME purpose of business.

Sixthly, to ensure that the new procurement bill focuses on at least 60% of government spending to benefit black business.

Lastly, invest in research and development that will focus on black business, driven by all the black lobby groups. R&D will give impetus in contextualising business ideas and concepts to the uniqueness of the South African business landscape.



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