She says it only benefits a few politically connected individuals at the expense of the masses.
Speaking on radio and to other media following the launch of her political movement, Agang South Africa, this week, (it is yet to be registered as a party), Mamphela Ramphele has not minced her words on the issue of black economic empowerment and how it risks undermining a post-apartheid South Africa.
Ramphele's criticism of BEE and widespread cronyism, which she believes contributes to poor service delivery and corruption, has won her widespread support.
She said that a focus on political patronage had denied poor and rural people significant benefits and had benefited a politically connected few at the expense of the masses.
These comments have been echoed by some senior African National Congress politicians such as Minister in the Presidency Trevor Manuel, concerned about lack of delivery and the resulting social unrest.
Ramphele, known internationally and to some extent locally more as a businessperson and the first woman managing director of the World Bank than for her impressive struggle credentials, until recently sat on the boards of some of South Africa's top companies in the position of non-executive director and in the case of Goldfields, as chairperson. She is also listed by Forbes as one of Africa's nine richest women. According to Who Owns Whom, she earned R3.8-million in 2011 just for her directorships and, has been awarded R1.6-million in shares from two of the companies.
The income from her directorships has come to an end, however. In the months leading up to the announcement of her political party, Ramphele announced her resignation from the boards of two mining companies, Anglo American and Goldfields, as well as Remgro and MediClinic International. It is not clear whether she will remain on the boards of some smaller unlisted companies, such as Solar Capital Renewable Energy where, according to its website, she is chairperson.
She was a non-executive director at Anglo American from 2006 until 2012 and at Mediclinic from 2005 until 2012. She took up the chair of Goldfields in November 2010.
Some of her personal wealth, according to Forbes, has come from a BEE private equity firm, Circle Capital Ventures, which, according to her son Hlumelo Biko's website and biography, experienced returns of R1.6-billion over an eight-year period from an initial R100-million investment. She started the company with her son, but according to Biko, she resigned from the Circle's board three years ago.
There is no doubt that Ramphele is an extremely competent businessperson, who also proved herself as vice-chancellor at the University of Cape Town and in a very demanding job at the World Bank, but her value to locally based major corporates in terms of BEE cannot be ignored. It is particularly advantageous in the mining sector, where the government has been unrelenting about calling for locally based mining companies to be headed, at the very least, by a South African, with a black chief executive being first prize.
Government's position was made blatantly clear during the search for a new chief executive for Anglo American, which eventually went to Australian Mark Cutifani, currently president of the Chamber of Mines. It could be asked whether Ramphele would have been able to make her way on to some of the white male-dominated boardrooms in the early days of democracy without BEE, but by 2005 she was on the board of Standard Bank, where she remained until 2007, and MediClinic, until July 2012. In a recent radio interview, she said that she believed her education gave her an advantage.
In its list, Forbes said that when it came to "big money, it is still the men who call the shots in Africa", but it identified nine women, largely in South Africa, whom it estimated were worth at least $50-million.
Ramphele has featured on the Forbes list for some time, with the 2009 Sunday Times Rich List estimating her net worth to be about R93-million. That list places her in position 143 out of 150 of South Africa's richest businesspeople in a largely male-dominated list.
The 2011 Forbes list, which estimates a much higher net worth for Ramphele, also includes Isabel Dos Santos, the eldest daughter of Angolan President Jose Eduardo dos Santos, who allegedly made her money through investments; Bridgette Radebe, the older sister of Patrice Motsepe, who has made her money through mining; Real Estate mogul Pam Golding; Wendy Ackerman, who together with her husband Raymond controls the Ackerman Family Trust, which has 50% of Pick n Pay; and Irene Charnley, who made her money from MTN stocks.
Having struggle credentials can sometimes prove to be a disadvantage to businesspeople who are then held to a high standard.
Cyril Ramaphosa discovered this after he was grilled about emails he had sent to Lonmin management demanding that the strikers be dealt with shortly before the Markiana shooting that resulted in 34 deaths. Ramaphosa, who had shares in Lonmin, has since denied that his emails had anything to do with the police shooting.
Ramphele (65), a medical doctor, philanthropist and the partner of murdered anti-apartheid leader and founder of South Africa's black consciousness movement Steve Biko, found herself being called to account as chairman when Goldfields was questioned about an empowerment deal involving its South Deep mine.
The list of BEE beneficiaries allegedly sent to shareholders included a nightclub owner, a police colonel and a former Inkatha Freedom Party MP. Ramphele's comment that she had not been part of the decision-making process has been criticised because of her strong stance on distributing wealth fairly to the previously disadvantaged.
However, in an interview with the Mail & Guardian, Ramphele expressed her frustration that the government's empowerment requirements did not allow for empowerment of the workers.
"The most disappointing thing for me is that employee share schemes in the mining industry are discouraged by the department of mineral resources because they want so and so. This is the list you must empower, [they say], not the mineworkers who are actually ... working in the mines.
"You would have assumed that a party that claims to be working for the people of South Africa would be very pleased to see a BEE deal that pays attention only to the workers."
She said a system that did not take colour into account would be the most effective. "We [Agang] are proposing the restructuring of the economy because BEE unfortunately takes us back to having to classify people in order for them to qualify to be BEE partners.
"South Africa has to start talking to the needs of all South Africans, whether they are white, in urban or rural areas. The only way to achieve that is to restructure the economy.
"If we train everybody properly, if we educate everybody properly, we will not need to count how many black heads there are. "Given the opportunity of a good education and training, black people will be able to compete quite ably without any daddy or mommy standing next to them."
Ramphele had not responded to questions about her investments at the time of going to print. — Additional reporting by Mmanaledi Mataboge For more about Mamphela Ramphele, see M&G Pages 3, 18 and 30