More than 75 percent of companies in the private sector are not complying with the Broad-Based Black Economic Empowerment, the minister of trade and industry, Rob Davies said on Tuesday.
"More than 75 percent of companies in the private sector are not BEE compliant," Davies said during a press briefing on the sidelines of the orientation session of the B-BBEE Advisory Council in Pretoria.
He said the level of compliance was even worse when it came to the indirect elements of empowerment such as skills development and enterprise development procurement.
Davies said this was according to a baseline study conducted in 2008/9.
"The research conducted in July 2008 shows the overall impact of BBBEE remains modest. Less than 5 percent of Johannesburg Stock Exchange is owned by black people."
However, Davies said the figure did not mean that companies had not made any effort in an attempt to comply with BEE.
He said government was looking at getting the advice of the council on how to address the BEE challenges highlighted by the research.
"We are all of the view that empowerment has got to play a significant role in the transformation of this country. In particular, we need to ensure that those elements that link empowerment to enterprise development are actually more effective than they appear to have been up to now."
Davies said under the B-BBEE Act, the council was empowered to conduct its own research, monitoring and evaluation of BEE implementation.
"As we proceed we will be able to consider what information we need to have on regular basis in order to chart the progress of empowerment, and what it is that we need to be doing to ensure that empowerment has more substantial effect and that effect is linked to the broader objectives of economic development and enterprise creation," he said.