The Financial Sector Charter is a transformation charter in terms of the Broad-based Black Economic Empowerment [BBBEE] Act [Act 53 of 2003].

The Charter came into effect in January 2004 as a result of the Financial Sector Summit hosted by the National Economic Development and Labour Council [Nedlac], the multilateral social dialogue forum on social, economic and labour policy. The Nedlac partners – government, business, labour and community constituencies – negotiated the Financial Sector Summit Agreements on transforming the financial sector and signed the Summit declaration on 20 August 2002.

The Charter preamble states:

In August 2002, at the NEDLAC Financial Sector Summit, the financial sector committed itself to the development of a Black Economic Empowerment [BEE] charter. We made this commitment 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 services inequalities. This is not only unjust, but inhibits the country’s ability to achieve its full economic potential;

• BEE 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 BEE 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 BEE.

The Charter commits its participants to 'actively promoting a transformed, vibrant, and globally competitive financial sector that reflects the demographics of South Africa, and contributes to the establishment of an equitable society by effectively providing accessible financial services to black people and by directing investment into targeted sectors of the economy'.

Financial institutions affected by the Charter include banks; long -term insurers, short -term insurers, re-insurers, collective investment schemes, investment managers, retirement funds, and licensed exchanges. Any other institution in the financial sector may opt to participate in the Charter.

Read about: The Charter Objectives
Download: The Charter & Scorecard