Broad-Based Black Economic Empowerment Act, 2003 (Act No. 53 of 2003)
Financial Services Charter
This Financial Sector Code (FS Code) has been prepared in terms of the Broad-Based Black Economic Empowerment (B-BBEE) Act, (Act 53 of 2003), subsequently referred to as the Act. It is based on a harmonisation of Generic Codes and the Financial Sector Charter gazetted under Section 12 of the Act.
The Financial Sector Charter (the Charter) came into effect in January 2004 as a result of agreements reached at the National Economic Development and Labour Council (NEDLAC) Financial Sector Summit in August 2002. NEDLAC is the multilateral social dialogue forum which brings together Government, Business, Labour and Community constituencies to approve social, economic and labour market policy.
Following the Summit, the Charter was drafted by the financial sector Trade Associations 1 and the Association of Black Securities and Investment Professionals (ABSIP2), with Government3 participating as observers. Although the labour4 and community5 constituencies were not included in the drafting of the Financial Sector Charter, they agreed to participate in its governing structure, the Financial Sector Charter Council, alongside Government, the financial sector Trade Associations and ABSIP to finalise outstanding elements of the Charter and to participate in overseeing the implementation of the Charter and the process for aligning the Financial Sector Charter with the Act's Generic Codes of Good Practice (CoGP).
In the alignment process, all the Financial Sector Charter Council participants committed to developing a sector transformation code aligned to the CoGP, noting that:
|•||Despite significant progress since the establishment of a democratic government in 1994, South African society remains characterised by racially based income and social inequalities. This is not only unjust, but inhibits the country's ability to achieve its full economic potential;|
|•||B-BBEE is a mechanism aimed at addressing inequalities and mobilising the energy of all South Africans. It will contribute towards sustained economic growth, development and social transformation in South Africa;|
|•||Inequalities also manifest themselves in the country's financial sector. A positive and proactive response from the sector through the implementation of B-BBEE will further unlock the sector's potential, promote its global competitiveness and enhance its world class status;|
|•||Equally, the financial stability and soundness of the financial sector and its capacity to facilitate domestic and international commerce is central to the successful implementation of B-BBEE.|
The Financial Sector Code commits all participants to actively promote a transformed, vibrant and globally competitive financial sector that reflects the demographics of South Africa, and which contributes to the establishment of an equitable society by providing accessible financial services to black people and by directing investment into targeted sectors of the economy.
This Financial Sector Code is the product of the interaction between the Trade Associations, ABSIP, Labour, Community and Government. The Code reflects the accord reached by all of the stakeholders regarding their joint commitment to fostering B-BBEE in the financial sector and in the South African economy.
1 The Association for Savings and Investment South Africa (ASISA); South African Insurance Association (SAIA); International Banking Association (IBA); Banking Association of South Africa (BASA), JSE Limited
2 ABSIP representing Black professional organisations
3 The Presidency, National Treasury and Department of Trade and Industry
4 Congress of South African Trade Unions (COSATU); National Council of Trade Unions (NACTU); Federation of Unions of South Africa (FEDUSA)
5 Financial Sector Campaign Coalition; Disabled People South Africa; National Co-operatives Association; Women's National Coalition; SA Youth Council; SA National Civics Organisation.