THERE can be few people in South Africa who believe the country has achieved a state of equilibrium that supports growth, development and prosperity for all its people, and that further transition is unnecessary. A critical pillar of this transition is black economic empowerment (BEE), which constitutes a number of efforts to integrate historically disadvantaged people and communities into all spheres of the mainstream economy.

It therefore seems surprising that the results of the Reputation Institute's 2012 Leader survey, released recently, suggest that some of the most prominent and successful leaders in BEE have lost their iconic status as trailblazers for a new economic order.

While mining magnate Patrice Motsepe achieved the highest score in the survey, albeit a relatively low score by international standards, other BEE leaders stemming from the inner circle of the ruling party have slipped into the middle of the spectrum.

This suggests the prominent players in the BEE space, who are seen to have got there predominantly through political clout rather than entrepreneurial initiative, are no longer regarded as proxies for people's aspirations. Despite their philanthropic initiatives, they have failed to convince the public that their involvement in the economy has helped to build a more equitable society or has benefited South Africans at large.

Ordinary people are now realising the BEE opportunities have become concentrated in the hands of very few people and are not, on the whole, benefiting a broad base of people. The survey therefore provides an opportune moment for a new conversation about making BEE work for those in real need of empowerment.

Motsepe's performance suggests wealth earned by people benefiting from BEE legislation per se is not an issue for the people surveyed, and this is supported by our research. Acquiring wealth through political connection is no longer perceived as worthy of inspiring respect and admiration among ordinary people.

So where has BEE gone wrong?

The first answer lies in what has turned out as a logical flaw in the concept of BEE.

BEE suggests people need to be empowered because they are black. It is beyond dispute that we come from a past in which people of particular race groups were excluded from economic opportunities and that our society is still marred by this inequality. The paradox, however, is that while the inequalities stem from the discrimination of people on the basis of race, they do not need to be empowered because they are black but because they are just as human as those who led privileged lives in the past.

At the same time, if efforts to empower those who are economically disadvantaged do not lead to an economy that represents the demographics of society at large, we know we still have not empowered those who are in real need of empowerment.

Indeed, if empowerment is based on the notion of the colour of people's skin, a few individuals emerge who never seem to be sufficiently empowered, no matter how many deals they participate in.

Their need for empowerment under current legislation has nothing to do with whether they are shack-dwellers or billionaires and everything to do with their being black.

The second reason for the failure of BEE is the cynical approach many captains of industry have adopted in order to comply with the legislation.

The commanding heights of the South African economy come from a long history of influencing the political and regulatory environment to exclude genuine competition and give a small group of politically highly connected players privileged access to the country's incredible wealth.

We should recognise that the way in which the redistribution of economic assets under BEE legislation has taken place has inherently been an extension of the colonial and apartheid ways of doing business.

It has in large part not sought the empowerment of those who have helped to build the existing wealth and were never fairly rewarded for their contribution, or those who are in desperate need of the most basic services and opportunities. Instead, it has secured the continuation of undue political influence to give an unassailable advantage to the few who already have it.

To illustrate the current logic of large BEE deals, consider the example of a (fictitious) mining company operating in Mpumalanga and Limpopo. In order to fulfil what it believes the BEE mandate is, rather than finally rewarding and empowering those who have toiled under apartheid laws like slaves to make the company what it is, the company engages a BEE partner.

It makes sure that the person, or company, is politically well connected.

The everyday word for rewarding someone with the intent of influencing legal and political decisions is all too familiar to us: it is corruption.

Such a BEE deal then needs to be funded. This happens by bringing in money either of the already privileged, who become major financial beneficiaries of such deals and get even richer, or of banks, which find it more convenient to finance a few relatively discreet and safe BEE deals than fund myriad small businesses that would genuinely create new value and employment.

The mining company then appoints key players in the BEE deal to its board. This lessens the pressure on the company to appoint other people from previously disadvantaged communities, who lose out on being promoted within this company. The BEE player who is appointed to the board is in some cases already a member of so many other boards that it is impossible for him to fulfil his fiduciary duties and it thereby undermines the integrity of the corporate governance of the company.

To put the cherry on the top, the politically connected BEE partner then uses some of the riches gained by such deals to influence the political process within the ruling party to tilt the decision-making process in his own favour, thereby further silencing the voices of the downtrodden.

All this is by no means meant to suggest BEE has failed in its entirety. Many aspects of the BEE legislation have had the intended effect. There are some excellent examples of how companies, such as Sasol with its Inzalo share scheme, have introduced participation schemes in which many people now share in the ownership of the company and now care about its success in a completely new way.

The correct way of doing BEE can be long-winded, protracted and difficult to successfully conclude. But if South Africa is to find its way along the path of prosperity and economic growth for all of its population, and not just a privileged few, it is essential that such schemes are much more widely explored and vigorously implemented. Not to do so is, to use the words of one of South Africa's infamous apartheid leaders in an entirely different context, to risk a future "too ghastly to contemplate".

. Heil is MD of the Reputation Institute SA and senior lecturer in strategy at Wits Business School.