The importance of ensuring Enterprise Supplier Development (ESD) from a leadership perspective
By rising to this challenge, today’s leaders can leave behind more than profitable companies. They can leave behind empowered suppliers, resilient supply chains, and a legacy of inclusive growth that future generations can inherit with pride.
Empowering South Africa’s youth
Partner Content June is a significant month in South Africa, marking Youth Month and commemorating the pivotal role young people played in the fight against apartheid, notably the historic Soweto Uprising of 16 June 1976. Youth Day, celebrated on 16 June, serves as a powerful reminder of the ongoing contributions to social transformation made by young people. It is both a tribute to their legacy and a call to reflect on the current opportunities and challenges facing the youth today. Nedbank’s Executive Head of Transformation, Kershini Govender, offers valuable insights into how the bank’s transformation journey is closely aligned with the country’s youth development and economic inclusion objectives. Central to this is Nedbank’s commitment to the Youth Employment Service (YES) Programme – a national, business-led collaboration with the government to address one of South Africa’s most urgent challenges. The youth unemployment rate in South Africa remains alarmingly high, standing at 46.1% in the first quarter of 2025 according to Statistics South Africa. “Nedbank’s purpose-led approach to transformation transcends compliance and box-ticking,” Govender explains. The bank embeds transformation within its core business strategy, driven by a purpose to use its financial expertise ‘to do good’ for its clients, shareholders, and society at large. This approach to transformation is underpinned by creating sustainable socioeconomic impact across society. A leading example of this commitment is Nedbank’s partnership with the YES Programme. Since 2019, Nedbank has onboarded 17 264 candidates, including this year’s sign-up, providing crucial work experience and skills development opportunities. The 2024 Nedbank YES cohort was empowered to gain meaningful employment and workplace exposure, either within Nedbank or through our partner organisations, the Africa Foundation and WILDTRUST. The impact of the YES Programme extends beyond employment figures, with about 64% of the work opportunities created being filled by women, and approximately 85% of YES participants coming from households reliant on social grants. Many participants also support their families with their income. Nedbank’s commitment to youth and transformation also extends into its Enterprise and Supplier Development (ESD) programmes. Nedbank’s ESD strategy is rooted in sustainable development principles; empowering entrepreneurs not only with funding, but also with mentorship, business skills, and access to networks. This holistic approach positions these enterprises for long-term success, which benefits both the entrepreneurs and the communities they serve. Govender reflects on the ongoing transformation journey at Nedbank with humility and optimism. The bank’s Level 1 B-BBEE contributor status, achieved for 7 consecutive years, signals deep commitment and consistent progress. She emphasises that transformation is not just a moral imperative, but a business necessity to remain relevant and effective in an evolving landscape. With over R930-million injected into the economy through salaries earned by YES youth across the programme and since its inception in 2019, Nedbank is one of the programme’s top 5 corporate sponsors, demonstrating how private sector leadership can catalyse systemic change. “The YES Programme continues to uncover extraordinary young talent and positively contribute to a more inclusive South Africa,” Govender says. “We are proud that our young people gain vital skills and that their families and communities benefit through this programme.” As South Africa marks Youth Month this June, Nedbank’s efforts exemplify how strategic partnerships and purpose-driven transformation can empower youth, uplift communities, and build a sustainable, inclusive economy. Through the YES Programme and its broader ESD initiatives, Nedbank is not only celebrating youth but actively shaping their futures and that of the nation.
Meaningful enterprise development: What does it mean-and where are we in South Africa?
By Livhuhani Mukhithi, Director: Broad-Based Black Economic Empowerment: Policy, Institutional Management and Advocacy – dtic The growth and development of economies throughout the 20th and the 21st centuries have been built behind deliberate planning, and undertaking by state actors, private players and other social partners. These initiatives have been anchored around principles of broadening economic participation and inclusion across sectors in the economic mainstream. Support, development and participation of enterprises in the economic mainstream should be premised on the interconnectivity between MSMEs, existing multi-national corporations (MNCs), and original equipment manufacturers (OEMs) within their global value-chains (GVCs). In the South African context, a recently commissioned study on Enterprise and Supplier Development (ESD) by the B-BBEE Commission (2022: 18) hammers on the imperative that Enterprise and Supplier Development forms part of the B-BBEE legislation. The ESD programme’s goal, according to the B-BBEE Commission, is to “create a conducive environment for the building of sustainable relationships between corporate South Africa and black entrepreneurs to facilitate access and transformation of value chains.” B-BBEE is a government programme that aims to correct past wrongs and spread the nation’s wealth among all races and genders, as well as promote growth, development, and entrepreneurial development. B-BBEE is the policy implementation through the B-BBEE Act (as Amended) and the Codes of Good Practice, which provide the foundation for ESD policies for big corporations. As ESD development and support has proven to nurture and consolidate technological development and uptake amongst MSMEs globally, Lee (2017: 03) contends that private companies (locally-owned companies) need to be able to move up the value-chain to higher-value added goods, based on continued upgrading and improvement, and technological innovation. This stands to effect structural transformation and inclusive participation in the mainstream economy. In praxis, a study on Enterprise and Supplier Development (ESD) by the B-BBEE Commission (2022: 17) qualifies the posture that holds that the ESD is not just a South African notion; it’s a global movement that has proved to boost economies, diversify supply chains, and create jobs. The bulk of businesses and a sizable share of employment in both developed and emerging economies are SMMEs. These enterprises, however, face many obstacles that prevent expansion, such as poor technological capabilities, limited human resource capacity, and restricted access to capital. Furthermore, the GIBS White Paper on Enhancing Enterprise and Supplier Development Ecosystem Effectiveness in South Africa (2024: 8) contends that there is more consensus in the implementation challenges of ESD programmes such as limited resources, misalignment of corporate and MSME programme participants, and inadequate monitoring and evaluation. These challenges are at the core of botched ESD programme implementation. South Africa’s effort to increase participation of MSMEs in the economic mainstream hinges upon a plethora of support mechanisms. According to the report on the State of the Small and Growing Business Sector by ANDE (2024: 04) the South African entrepreneurial ecosystem requires innovative solutions to increase the available finance, improve access to markets, reduce bureaucratic burdens, and strengthen the capacity of small businesses and start-ups. The report also examines the state of the Small and Growing Businesses (SGB) sector in South Africa as of 2023 by assessing the amount and type of financial support available to enterprises, the type of capacity development offered, and trends in the policy landscape that affect the entrepreneurial ecosystem. It is also vital to acknowledge that the legislative ecosystem that is in existence to support entrepreneurship, enterprise and supplier development requires updating and reviewing to provide a blueprint for the building of a vibrant MSME sector. The GIBS report concedes that South Africa has a relatively robust financial and capacity-related development landscape for MSMEs. The report State of the Small and Growing Business Sector identified 197 active funding sources offering financing in the form of loans (43%) and equity (41%), with the remainder made up of grants (16%), quasi-equity (7%), and guarantees (5%). Nevertheless, the credit gap among MSMEs continues to be significant. Additionally, the South African economic mainstream’s relationship with MSMEs is characterised by relationships that are both progressive to the country’s reindustrialisation efforts and the ones that are only driven by the compliance imperative (informed by the tick-box approach for compliance purposes). The magnitude to which MSMEs are connected, or not connected, to the GVC of MNCs differs significantly and varies from strategic high value chain integration to non-core value chain integration. On one end, certain MNCs conduct extensive value chain and supplier opportunity analysis to inform the identification of supplier opportunities. At the other end of the scale, other MNCs and corporates link MSMEs to less strategic, non-core supply opportunities. Some corporates have a mixed ESD approach in terms of linking MSMEs to both core and non-core supply opportunities. As contained in the study commissioned by the dtic (2019), the five most common benefits reported by 65 MSMEs surveyed and participating in Enterprise Development programmes are in order of frequency: 1. Business management skills & systems (31%); 2. Networking and business opportunities (14%); 3. Market access (12%); 4. Financial support (9%); 5. Company (marketing /brand) exposure (6%). On the Supplier Development (SD) side, the 5 most common benefits reported by 29 MSMEs surveyed and participating in SD programmes are, in order of frequency: 1. Business management skills & systems (17%); 2. Marketing skills (17%); 3. Access to markets (17%); 4. Financial management skills (10%); 5. Company (marketing/ brand) exposure (10%). The B-BBEE Commission Study (2022) gives us a sense of where we are currently are as a country in relation to B-BBEE ESD compliance. The report underscored a low level of compliance on ESD spending by measured entities. According to the B-BBEE Commission, “in 2021 only 61% of the set targets was achieved for ESD, which is a continuing trend over the past five years (2017: 44%; 2018: 60%; 2019: 51%; 2020: 61%)”. The matter to point at on ESD and its application exceeds the compliance imperative as obligatory legislatively by all economic actors, it is about releasing its might in driving economic inclusion and participation. As