Fronting in the B-BBEE (Broad Based Black Economic Empowerment) sector came under the spotlight in Cape Town last night at the first debate which forms part of the Frank Dialogues on Black Economic Empowerment (BEE).
The dialogues are to create a public platform where issues such as the role of public policy and organised business in reshaping the economy, are examined in a frank and constructive manner. Fronting continues to defeat the intent of such legislation and undermines the development of black business.
At present, the Public Works Department is taking a former company of controversial property tycoon Roux Shabangu to court in an attempt to have a lease it signed with him declared void.
In a case lodged with the Pretoria High Court last week, Public Works alleges Shabangu fronted for a white-owned company and committed fraud by pretending he owned the building for which it signed the lease.
These and other issues related to fronting come under the microscope at the first in a series of dialogues aimed at curbing this malpractice.
The Pholosang BEE Resolution Services JJ Tabane elaborates; “This is the first in a series of frank dialogues on black economic empowerment to be held countrywide. There are fundamental structural problems in the economy and the manner in which B-BBEE is implemented. There is a need for frank and constructive debate about these problem.”
We do urge investors to adhere to the law when choosing BEE partners