Broad-based black economic empowerment and CEO racial representation in South Africa

This paper is an empirical exploration of the effectiveness of racial inclusion policies in South Africa, namely broad-based black economic empowerment (B-BBEE), on the racial composition of corporate leadership in South Africa. Prior perceptions on B-BBEE suggest that the legislation has only benefited a small group of the population which has only led to further economic exclusion across and within racial groupings in South Africa. In this article, the racial composition of corporate leadership among listed entities on the JSE is analysed to establish if employment equity-one of the core elements under B-BBEE has been achieved. The results illustrate that CEO and executive directorship positions are still primarily occupied by white individuals. In addition, the likelihood that a black individual will be a CEO is primarily influenced by whether or not corporate executive directors are white or black. Furthermore, black individuals appear to predominantly occupy non-executive and independent directorship positions, whereas white individuals primarily occupy executive directorship positions. This study therefore contributes to the growing body of research that explores the efficacy of B-BBEE within the corporate sphere in South Africa.