Is B-BBEE delivering? A 2026 advisory position on transformation that moves the dial

B-BBEE is delivering uneven results in 2026: ownership and management control scores are trending up, while enterprise and supplier development remains the weakest scorecard element.

Ownership scores are trending up, skills development is stuck, and enterprise and supplier development remains the weakest of the five Generic Codes elements.

This piece addresses bbbee, moves, dial as the core focus, drawing on Kettle's South African public-sector and corporate advisory practice.

The argument that Broad-Based Black Economic Empowerment has failed is loud, frequently litigated, and incomplete. The argument Is B-BBEE delivering? A 2026 advisory position on transformation that moves the dial is B-BBEE delivering? A 2026 advisory position on transformation that moves the dial is succeeding is quieter, harder to evidence, and equally incomplete. Both views miss what the data actually shows: B-BBEE is doing some things well, several things badly, and the gap between the two is where advisory work should focus.

This note sets out the position Kettle Consulting takes with audit committees and executive teams when transformation comes onto the agenda — what the B-BBEE Commission scorecard tells us in 2026, where the policy is delivering, where Is B-BBEE delivering? A 2026 advisory position on transformation that moves the dial is not, and the three structural fixes growth-stage and listed entities should be making now.

Where the B-BBEE Generic Codes scorecard sits in 2026

The B-BBEE Commission publishes its National Status and Trends on Broad-Based Black Economic Empowerment annually. The trend across the last three reports is consistent. Ownership and management control scores have improved meaningfully on JSE-listed entities. Skills development, enterprise and supplier development, and socio-economic development scores have either flatlined or declined.

_Source: B-BBEE Commission, National Status and Trends on Broad-Based Black Economic Empowerment Reports 2018-2024. Averages across Generic Codes scorecard submissions._

Element · Weighting (Generic) · Average 2018 · Average 2024 · Direction

• Element: Ownership — Weighting (Generic): 25 — Average 2018: 17.3 — Average 2024: 20.1 — Direction: Up
• Element: Management Control — Weighting (Generic): 15 (excl. youth bonus) — Average 2018: 7.9 — Average 2024: 9.4 — Direction: Up
• Element: Skills Development — Weighting (Generic): 20 — Average 2018: 12.6 — Average 2024: 11.8 — Direction: Flat to down
• Element: Enterprise & Supplier Development — Weighting (Generic): 40 — Average 2018: 24.1 — Average 2024: 23.7 — Direction: Flat
• Element: Socio-Economic Development — Weighting (Generic): 5 — Average 2018: 4.5 — Average 2024: 4.3 — Direction: Flat

Two things stand out. First, the element with the largest weighting — enterprise and supplier development at 40 points — is the worst performing. Second, the skills development element has gone backwards in real terms once you adjust for scorecard inflation. Both findings should change how boards prioritise their transformation spend.

Where B-BBEE is working

Ownership is shifting, even if measurement is contested

Direct ownership by Black participants in JSE-listed entities has measurably increased since the 2013 Codes revision. Stats SA Quarterly Labour Force Survey data and JSE shareholder analytics show that Black ownership of the top 100 JSE-listed companies has moved from a 21% range a decade ago into the low 30s when sale of asset arrangements and modified flow-through are properly counted.

The contestation is real and worth naming. Critics argue that ownership scores are inflated by once-off transactions, debt-funded schemes that mature without delivering real economic interest, and trust structures that report participation in a way the 2018 Practice Note on Trusts was specifically designed to constrain. The Codes have been amended at least three times to close those loopholes. The B-BBEE Commission now publishes a register of findings on fronting, which is the right enforcement direction even if penalties remain limited.

Skills development spending is happening — even if recognition is patchy

The Skills Development Act and the levy regime channel approximately R20 billion per year through the SETA system. The question is not whether companies are spending. They are. The question is whether that spend translates into bankable, recognised qualifications and into measurable employability — and here the record is uneven.

Where B-BBEE is not working

Enterprise and supplier development is the chronic underperformer

Enterprise and supplier development is the heaviest weighted element of the Generic Codes scorecard at 40 points. It is also the element with the highest fronting risk, the lowest verification confidence and the weakest implementation track record across the listed universe. The B-BBEE Commission has flagged supplier development specifically as the area where most complaints of fronting and circumvention arise.

The pattern is consistent. A measured entity signs an ESD agreement with a Black-owned supplier. The supplier is structured so that operational control sits with the procuring entity. Revenue flows through the supplier on paper but margins, decisions and risk sit elsewhere. The verification agent records the ESD points. The B-BBEE Commission, on review, finds the arrangement does not meet the substance test in the 2024 Practice Note on Fronting Practices.

Socio-economic development is being treated as charity, not strategy

Socio-economic development scores remain low not because companies are not spending, but because the spend is poorly targeted, poorly measured and rarely linked to the entity's own operational footprint. King IV requires social and ethics committees to oversee transformation outcomes. In practice many committees rubber-stamp the verification report and ask few questions about whether the spending is producing measurable change.

Three structural fixes Kettle recommends

After two decades of B-BBEE, the question is no longer whether the policy framework works — it is which parts of the framework deliver, and what advisory work needs to happen inside the company to make the rest deliver. We recommend three structural fixes.

1. Treat enterprise and supplier development as a procurement strategy, not a compliance line

The companies that score well on ESD do not run it through a transformation officer. They run it through procurement, with a five-year supplier development plan, ringfenced concessionary terms, and a board-approved budget. The B-BBEE Commission's own analysis shows that measured entities with executive-level ESD ownership consistently outperform those that delegate it to a transformation function.

• Identify three to five strategic Black-owned suppliers per category — not a long tail of nominal relationships.
• Move from annual ESD top-ups to multi-year capital commitments linked to procurement growth.
• Verify substance by stress-testing operational control, decision rights and economic interest — not just the shareholder register.
• Report ESD outcomes to the social and ethics committee with the same rigour as financial KPIs.

2. Shift skills development from spend to recognised qualifications

The Skills Development Act and amended Codes both reward NQF-aligned, formally recognised training. Companies that hit their full 20 points are doing learnerships and bursaries linked to scarce skills, with completion rates tracked. Companies that fall short are still funding short courses with poor accreditation and no follow-through. SAICA, IIA-SA and the engineering professional bodies all publish scarce-skill registers that should anchor a learnership strategy.

3. Move ownership conversations from once-off transactions to durable economic interest

The amended Codes deliberately tighten what counts as ownership. Sale of asset arrangements, broad-based schemes with thin economic interest, and ESOPs structured around debt service that absorbs all dividends do not deliver the 25-point ceiling the way well-designed schemes do. The conversation with the audit committee should be about durable economic interest over five to ten years, not the score in the next verification cycle.

Ownership without economic interest is not ownership; it is a line item that reads well at verification and disappears when the dividend cycle starts.

— Kettle Consulting advisory position

What this means for boards in 2026

Three implications for audit committees, social and ethics committees and CFOs of JSE-listed entities and growth-stage companies in the 2026 reporting cycle.

1. Ask for a substance test, not a score. Verification certificates are necessary but not sufficient. Ask whether each element is delivering measurable economic outcomes inside the operating model.
2. Reallocate. ESD is 40 points of the scorecard and should command a proportional share of executive attention. Skills development should be measured by qualifications, not Rands.
3. Lengthen the planning horizon. Five-year transformation plans signed off by the board produce better outcomes than annual scrambles to top up the score before verification.

Practical implications for 2026 reporting

Listed entities preparing for the next verification cycle should be doing three things in parallel. First, run a substance test against the 2024 Practice Note on Fronting Practices and the amended Trust Practice Note before the verification agent walks through the door. Second, align skills development spend with NQF-recognised qualifications and the scarce-skill registers published by the professional bodies. Third, redesign ESD as a procurement-led, multi-year programme — not an annual transfer to a third party.

The B-BBEE Commission has signalled, repeatedly, that 2026 verifications will be scrutinised more closely. The Commission's public statements through 2024 and 2025 indicate increased focus on substance over form, particularly in ESD and trust-held ownership.