How to Navigate B-BBEE Requirements as a Non-Profit Company Operating in South Africa

The B-BBEE Act, through the Codes of Good Practice, makes provision for Specialised Enterprises like Non-Profit Companies (NPCs) to become B-BBEE compliant. This article outlines the key requirements for NPCs and why compliance is beneficial.

Why a Specialised Scorecard?

NPCs, along with state-owned entities, public benefit organisations, and higher education institutions, lack shareholding or equity structures and are therefore not evaluated on black ownership. A specialised scorecard is used instead.

Classification of NPCs

Exempted Micro Enterprises (EMEs)
Turnover/budget/receipts: R0–R10 million

• Level 4 affidavit by default
  
  
• Level 2: >51% black beneficiaries
  
  
• Level 1: >75% black beneficiaries
  
  

Qualifying Small Enterprises (QSEs)
Turnover/budget/receipts: R10–R50 million

• Require verification for B-BBEE certificate
  
  
• May use affidavit if >51% black beneficiaries (Level 2) or >75% (Level 1)
  
  

Large Entities
Turnover/budget/receipts: Over R50 million

• Full B-BBEE verification required
  
  
• No affidavit option
  
  

Specialised Scorecards

QSE Scorecard

• Management Control: 25 points
  
  
• Skills Development: 30 points
  
  
• Enterprise & Supplier Development: 30 points
  
  
• Socio-Economic Development: 15 points
  
  

Large Entity Scorecard

• Management Control: 20 points
  
  
• Skills Development: 25 points
  
  
• Enterprise & Supplier Development: 50 points
  
  
• Socio-Economic Development: 5 points
  
  

Why B-BBEE Compliance Matters

• Enhanced reputation and stronger stakeholder relationships
  
  
• Alignment with national economic goals
  
  
• Access to funding from government, corporates, and international donors
  
  

Key Points for NPCs

• Black beneficiaries must be verified with IDs as defined in the B-BBEE Act
  
  
• NPCs cannot be ESD beneficiaries as they have no ownership
  
  
• SED contributions depend on the nature of the contribution and % of black beneficiaries, not the NPC’s B-BBEE level
  
  

Conclusion

B-BBEE compliance is essential for NPCs seeking credibility, alignment with transformation goals, and access to funding. By applying the correct scorecard and ensuring beneficiary verification, NPCs can thrive in a transformation-driven environment.

For further guidance, please contact us at info@elevateadvisory.co.za or visit www.elevateadvisory.co.za.

‍