South African development finance institution (DFI) the Industrial Development Corporation (IDC) has reaffirmed its commitment to supporting black-owned and black-controlled enterprises, on the back of public reports of allegations of anti-transformation practices and governance concerns.

This follows media reports that the IDC's lending practices have come under scrutiny, as several black-owned companies are facing liquidation over loan repayments.

Black-owned enterprises currently account for about 60% of the IDC's funding portfolio, the institution pointed out during an April 30 media briefing.

While the IDC has acknowledged concerns raised by some entrepreneurs and business formations, it cautioned against generalising individual cases or characterising all distressed outcomes as evidence of institutional bias or anti-transformation conduct.

Speaking at the media briefing IDC CEO Mmakgoshi Lekhethe said the institution has, to date, supported 73 companies through its partnership with the Department of Trade, Industry and Competition's (dtic's) Black Industrialists Scheme, with total funding of about R7.28-billion approved in support of these enterprises.

She noted, however, that the challenging macroeconomic environment has placed strain on many businesses across the economy, including those supported by the IDC.

During the past financial year, the IDC approved about R2-billion in funding specifically to support distressed businesses.

Addressing governance-related allegations, Lekhethe reaffirmed the IDC's commitment to ethical conduct and accountability.

IDC chairperson Gloria Serobe added that the board is cognisant of the seriousness of the issues being raised publicly and would engage with this properly.

Meanwhile, the institution is also repositioning how it operates, Trade, Industry and Competition Minister Parks Tau said during the briefing.

"The IDC's role is evolving from being a traditional direct lender towards becoming a platform for industrial ecosystem development, mobilising capital, partners and capability to unlock high-impact sectors and rebuild South Africa's industrial base," he informed.

Tua explained that this new IDC mandate is informed by government policy and creating enablers, including infrastructure investment, special economic zones and industrial parks, as well as trade and industrial finance instruments and regulatory reform, while improving the ease of doing business.

"In fulfilling this policy and programmatic mandate, public and private partnerships are very important to collectively grow our economy at a rapid pace so we can effectively address the stubborn trifecta of poverty, unemployment and inequality," he stressed.

To deliver this, the IDC is working to mobilise partners to allow co-investment across value chains and broadening the institution's reach through intermediaries.

Within a partnership-centred model, the IDC would act as a primary financing partner for structural reforms in network industries.

The partnership model would focus on five strategic streams, namely, public sector and State-owned enterprise co-investments in energy, freight rail and water; multilateral and bilateral DFI collaboration for blended finance and technical assistance; academic and innovation ecosystems to commercialise research and development; channel and intermediary partners to reach small- and medium-sized enterprises and rural businesses; and private sector consortia for technology transfer and market access, he outlined.

Tau also mentioned that this developmental and transformational path requires an appropriate governance structure. "It is for this reason we have appointed a capable board, comprising of experienced professionals drawn from the legal, finance, energy, mining and engineering sectors," he averred.

He pointed out that, over the past seven months, the board has progressed in moving the IDC beyond its traditional lending model and ensuring that it becomes a platform to deploy capit...