Diversity and Inclusion in the Supply Chain

Diversity and Inclusion is increasingly being seen as more than just another arm of Human Resources – as organisations are seeing the benefits of applying good D&I policy beyond the workplace and into other areas, such as supply chain and procurement. At our most recent meeting, the Diversity and Inclusion Working Group discussed this in some detail, identifying and highlighting some of the ways to help drive the awareness of this concept.

Building diversity into an organisation’s supply chain can initially seem like a difficult challenge. However, when broken down into more manageable and achievable goals, it can start to bring great value and benefits to businesses. There is a body of evidence that shows that companies with strong D&I practices are more effective and profitable, and this is also apparent when applied to procurement practices.

Building D&I into procurement practices has increasingly shown to bring a broader range of financial benefits, as well as the obvious social benefits. As innovation predominantly comes from individuals and small diverse businesses, many technological developments and new solutions are being developed by these more agile groups. This enables businesses to bring innovations into their working practices more quickly, which in turn increases competitiveness and the bottom line. In addition, the social value and reward of having suppliers that accurately represent their customers’ communities can be significant for any business.  

However, members felt that the advantages of building D&I into the supply chain are not always properly amplified and sold to senior executives, and there is a need for better advocacy. It was clear from our discussion that the concept of Diversity and Inclusion in Supply Chains has yet to be integrated (or even acknowledged) by many SMEs. Members described their experience of dealing with D&I in supply chains as something that is often on the agenda internally but translating this into action across the whole supply chain can be difficult. A good first step is to understand what standards or KPIs are currently in place to measure these outcomes. There is yet to be a standardised evaluation method or set of definitions to help UK businesses measure this. For this concept to be better integrated, the Working Group acknowledged that there is a space for creating better standardised definitions of D&I practices that SMEs can easily access and utilise when reviewing their suppliers.

The group recognised that when dealing with a direct supplier there is an ability to have greater oversight into D&I practices. However, as the supply chain expands (particularly into areas of the Global South) there is difficulty in measuring and accessing the necessary information for businesses to make informed decisions. It was felt that for businesses to make more informed choices, there must be a greater dialogue between governments, international NGOs, IFIs and trade associations.  

British Expertise International will organise a follow up panel discussion on this topic for the membership later this year, to discuss how better advocacy for diverse supply chains can be achieved, how organisations can mitigate risks in this area through contractual provision, and learn about standards and frameworks that can support diverse and inclusive procurement practices.

This discussion took part at British Expertise International’s Diversity and Inclusion Working Group meeting in April 2021. The D&I Working Group is composed of organisations from a range of different sectors. Members use the group to showcase expertise, share best practice, provide peer to peer assist and produce outputs. To learn more about membership please contact Alexandra Barnes.

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