Abstract
M.Comm.
Affirmative action has been greatly debated as a means of righting the injustices
of South Africa's past. Its proponents claim it to be an effective way of providing
opportunities to those falling under the definition of previously disadvantaged,
while cries of "reverse discrimination" echo from those vigorously opposed to it.
One of the ways in which empowerment can be achieved is through encouraging
government and businesses to make use of affirmative companies in the
procurement of day to day goods and services. The first initiative from
government came in the form of the Ten Point Plan from the Departments of
Public Works and Finance. This was later encapsulated in the Green Paper on
Public Sector Reform and the "Resource Specification for the Targeting of
Affirmable Business Enterprises". This allowed businesses quoting for
government work to score themselves against certain criteria, viz. either by
virtue of their being affirmable business enterprises (ABEs), which are two thirds
owned by previously disadvantaged individuals (POls), or by entering into joint
ventures of various kinds with ABEs.
It is believed that the approach of basing a company's contribution to affirmative
procurement purely on two-thirds ownership is limiting, and that more aspects
need to be investigated to determine the level of empowerment a company is
offering its employees. In addition, the high percentage ownership is a
temptation for companies to engage in fronting, where token appointments are
made and there is no true management or control by the company's PDI
management.
Subsequently it is vital that alternative approaches be taken. Corporations need
to keep track of their spend with PDI owned companies, but need to know how to
determine how effective these are in implementing to true economic
empowerment.