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When we talk about sustainability, we tend to think of protecting the environment, of “going green.” But sustainability also speaks to economic sustainability, to shoring up the long-term future of our businesses. There is no doubt that the adoption of sustainable business practices is a desirable and attractive thing for a company to do. Yet the economic realities and simple business sense of becoming more sustainable are the real drivers, as noted by a recent Ernst & Young report pointing to the CFO’s role in sustainability being on the rise – and supplier diversity is an intrinsic part of that.
What does supplier diversity have to do with sustainability, you may ask? In terms of economic sustainability, a great deal. M/WBEs and SMBs by necessity tend to be entrepreneurial and agile in nature, used to thinking creatively and working collaboratively to get things done; working with less to do more – the very essence of sustainability. But at the moment, there is a very real lack of transparency from corporations on their supplier diversity data.
The release of workforce diversity data by some of the major players in Silicon Valley made a big splash this summer, surprising no one with its dominant skew towards young, white and Asian, predominantly male employees. As the old saying goes “the first step is admitting you have a problem,” and with the release of these figures, I welcome the commitment from tech giants including LinkedIn, Twitter and Facebook to work to implement change over the coming years to build more diverse workforces.
But these figures still only tell part of the picture – the diversity data released could itself have been more diverse. While I applaud the companies for publishing the information they did, where was the data on supplier diversity?
In order for M/WBEs to gain a place at the corporate table, and in order for these tech giants to recognize the importance of building supplier diversity objectives into their sustainability plans, these figures should be shared.
As I have alluded, I believe one way to do this is to close the gap in corporate thinking between supplier diversity and sustainability – essentially by bringing economics into the dynamic.
It’s time to re-frame the supplier diversity conversation and move away from the language that can sometimes confine us. As just one example, even the word “minority” can belie our collective heft. Just like Silicon Valley, we have some pretty impressive growth figures ourselves – not the least of which is population growth. 2012 data from the U.S. Census Bureau predicts that by 2060, more than 1 in 3 U.S. residents will be Hispanic, up from 1 in 6 today. The black population is also set to rise to 14.7% from 13.1% today. As MBEs we are perfectly positioned to connect corporations with our increasingly diverse population.
In business terms, according to the U.S. Minority Business Development agency, American M/WBEs account for $1 trillion in revenues and 5.8 million jobs. Furthermore, MBEs are twice as likely to export compared to non-M/WBEs and are cited as “uniquely equipped” to do so. According to data from 2007, minority-owned companies were more likely to have operations established abroad in 14 of 19 industry sectors as compared to non-minority-owned firms.
As an active member of the M/WBE community, I know there is creativity in diversity. I believe there’s significant opportunity to make great use of tools such as Twitter and the marketing automation programs that Silicon Valley has created and with wit, determination and sound business sense start the dialogue afresh.
As was the case in the early days of sustainability, for many companies supplier diversity might feel like an unwelcome additional pressure, or simply feel like something to be checked off a list. It’s time to connect the dots for these corporations and move from a “you versus us” mentality to a “we” holistic sustainability discussion. Let’s prove the enormous business strength strategic supplier diversity planning can bring.
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