The 5 Elements Of BBBEE

The 5 Elements Of BBBEE


When it comes to BBBEE compliance in South Africa, evaluating the following five elements of your company could assist you in reaching the correct level for your company. The following diagram breaks down the different elements:


Of these five BBBEE elements, Ownership, Enterprise Development and Skills Development are considered priority elements. That means that if Stemcor does not score at least 40% of the minimum target of these priority elements, Stemcor will be discounted by one level on their overall score.

Example: Stemcor would get a BBBEE level 5 due to the points achieved, yet will be discounted to level 6 due to not reaching 40% of the threshold for Ownership for example.

Related: What Is BBBEE?

The Weight of BBBEE Compliance

“Old” Point Structure Revised Point Structure
Element Points Element Points Compliance Target
Ownership 20
(3 bonus)
Ownership 25 25% + 1 voting right
Management Control 10
(1 bonus)
Management & Control 19 50% of voting rights
Employment Equity 15
(3 bonus)
Skills Development 15 Skills Development 20
(5 bonus)
6% of Payroll Spent
Procurement 20 Enterprise & Supplier Development 40
(4 bonus)
Preferential Procurement – 80%

Supplier Development – 2% NPAT

Enterprise Development – 1% NPAT

Enterprise Development 15
Socio-Economic Development 5 Socio-Economic Development 5 1% NPAT
Total OLD points 100 Total NEW points 109  

BBBEE Certification

➤ The Investment House assists with professional design, implementation & reporting of all Corporate BBBEE efforts to ensure maximum gain

It is a requirement to have suitable documentation & evidence for a business’s BBBEE scoring. Professional BBBEE businesses, like The Investment House (Pty) Ltd, assist in the design, creation, implementation and documentation of all BBBEE efforts.

Related: What To Look For In A B-BBEE Partner

The tasks of Verification Agencies are to audit and verify the BBBEE evidence in order to issue a company with a BBBEE certificate. BBBEE certificates – confirming the BBBEE scoring – can be issued by any Verification Agency that has been approved by the South Africa National Accreditation System (SANAS).

BBBEE Certificates are evidence of a company’s BBBEE credentials and create a new level of access into corporate markets and assist in securing business with the public sector and government body.

➤ BBBEE Certificate proving the BBBEE compliance assists with access into new markets

The Investment House
The Investment House combines leading-edge industry expertise with creative talent and strategic thinking to reach the objectives of our clients. Our mission is to contribute with Business Development and Business Intelligence to an empowered nation enjoying financial freedom and prosperity. Our vision is to be South Africa's most successful business developer creating sustainable economic growth and wealth.