Controversial businessman Iqbal Survé, who has been addressing the PIC Inquiry hasn’t been afraid to drop bombshells. The millionaire turned his attention to the Black Economic Empowerment (BEE) model on Tuesday, where he lambasted the programme for its shortcomings.
IOL even quoted him as labelling the PIC’s investment strategy as “racist”.
Public Investments Company: What is the PIC Inquiry?
Announced in October 2018 by President Cyril Ramaphosa, the Judicial Commission of Inquiry is investigating allegations of impropriety following reports of poor governance and precarious investment processes.
The commission’s terms of reference also include a review of the PIC’s governance and operating model, possible changes to their founding legislation and a suspect Memorandum of Incorporation and investment decision-making framework.
Iqbal Survé slams BEE model
BEE was designed to help disenfranchised black citizens find work after the fall of apartheid. But in its 22-year existence, the programme has been blighted by poor management and questionable implementation. Despite its good intentions, implementation has been
Survé pulled no punches as he ripped into the “negligible” business model. He argued that any attempt to bridge racial barriers were artificial, and claimed that the inequalities of society still reflect on the stock market:
“The model of black economic empowerment (BEE) was not designed to bring about meaningful economic transformation but served as a mere entry point into the capital markets, albeit in a totally artificial way. Real economic wealth still rests in white-controlled-and-dominated companies.”
is,effective black ownership and control of these entities was negligible. The result is that racial inequalities exhibited elsewhere in the South African economy, such as ownership and control of land, continue to be reproduced on the JSE.”
#PICInquiry Surve’: When you talk about empowerment, black people are asked to buy shares, they are underwater. I think its NB that trade unions participate – that is real economic empowerment. The BEE shareholding is critically important to its business plan.
— Warren Thompson (@ThompsonWarren8) April 2, 2019
“Black businesses falling away from JSE”, PIC Inquiry told
Iqbal Survé highlighted the plight of several BEE-established companies – such as Nail and REAL – to demonstrate his point to the PIC inquiry panel. These businesses have ceased to exist, inadvertently leading to a decline in the number of black-owned companies registered with the Johannesburg Stock Exchange (JSE).