Compiling this year's Top Empowerment Companies (TEC) was more of a logistical challenge than last year.
The main reason is that TEC aims to provide an objective comparative analysis of companies' attempts to implement empowerment initiatives in an unregulated environment.
However, there are no universal rules and few global definitions. Consistent measuring and reporting criteria are nonexistent.
Late last year, after Empowerdex had spent months compiling the rankings, the trade & industry department issued its broad-based black economic empowerment (BEE) codes of good practice, the definitive rule book on empowerment.
As with last year, we struggled to get some companies to provide detailed information on their empowerment progress. Curiously, some that co-operated last year were less forthcoming this year.
Hopefully, the introduction of the codes and the clarity they provide on measuring and reporting on empowerment will mean that companies will be more forthcoming in future.
At present empowerment is seen as a competitive factor, but in the long run it will cease to be. The ultimate aim of empowerment is to reach a point where all SA companies are transformed and we're tapping from as wide a base of resources as possible as we grow our economy. Notwithstanding its comparative element, TEC is not about judging one group against another. We do not do the rankings because one form of empowerment is better than another. Rather we seek to measure the progress companies make in transforming.
TEC aspires to provide business with the information and analysis that is needed to be successful. It functions as a comparative ranking of company performances in the BEE arena, but it is primarily a reference guide on what companies are doing and how they are doing it.
Most companies will have to deal with empowerment at some point. TEC makes it easier to face that reality by providing benchmarks and information.
What makes TEC unique as a product is the combination of thorough quantitative and qualitative analysis combined with reporting on BEE best practice.
The survey conducted by Empowerdex is quantitative. FM writers, who are experts in their sectors, utilise the information to provide a qualitative analysis of the survey.
One of the most important aspects of the codes of good practice is that they define broad-based empowerment - and it is not broad-based ownership. The codes identify ownership as narrow empowerment, regardless of who is in the empowerment consortium.
What this makes clear is that government's BEE policy is not about ownership, but about improving black people's access to the economy: encouraging more black management; promoting employment equity; encouraging skills training in companies; nurturing black entrepreneurship; and building small and medium-sized black enterprises by means of affirmative procurement.
What happens at the level of ownership has everything to do with business and nothing to do with government.
The codes include the target beneficiary of each empowerment factor. That means - in theory - that if businesses use the codes as a guideline for promoting empowerment, there will be a clearly defined cross-section of society that benefits.
There is no question that implementing BEE is costly. The reporting alone is an annoyance for most companies. However, the retail boom and the consumer-led growth of the past five years highlight the benefits of spreading wealth.
We believe that empowerment, properly implemented, will benefit the economy as a whole and ultimately most businesses.
True, the economy cannot rely on private-sector consumption growth alone; exports and fixed investments are vital for sustained economic growth.
The key to sustained growth is to kick-start the economy and make it attractive to domestic investors. When they become confident and there are returns to be made, external investors will develop an interest.
Broad-based empowerment can assist with this, but it must be a social contract that benefits all stakeholders in the domestic economy.
Human capital is still a vital force in economic growth. Whether that is in the form of skilled labour or simply finding ways to make as much of the population as productive as possible remains a key factor of economic growth. That's what empowerment is about.
