The Indigenization Of Business Ownership In An Emerging Market: Doing Business In South Africa

Abstract

Black economic empowerment (BEE) has transformed the South African economic and business environment, and continues to be one of the most important issues a company has to deal with in doing business in South Africa. The indigenization of ownership is also developing as a concern in several other emerging markets particularly in Latin America. This research focuses on BEE issues within the small medium enterprises (SMEs) sector of the engineering industry. The research set out to identify the issues which were considered to be important for the successful implementation of BEE. A significant finding was the importance of upfront planning and setting of objectives prior to implementation of BEE initiatives. The research also found a very low level of satisfaction with the outcomes of BEE initiatives. The findings of this research can prove to be valuable for policymakers and business as they review the progress made towards achieving the broader objectives of indigenization and the costs of doing business in such an environment.