How important is it for your suppliers to have an active and measurable diversity, equity, and inclusion program in their workplace?
How important is it now that we are into the second wave of the COVID-19 pandemic?
No one would be able to present a reasonable argument against the earnest pursuit of diversity, equity, and inclusion (DE&I) in the workplace. Nor would anyone suggest that there are no tangible benefits resulting from a supplier’s working environment with a DE&I program in place. Let’s face it: a happy workforce is an efficient workforce capable of delivering the highest quality products and services.
However, what happens when external forces create unprecedented pressure on cash flows or product flow? What is the likelihood that socially driven initiatives such as DE&I will be maintained or even measured during a crisis period?
Without digressing too far, allow us to take a bit of a detour by talking about cybersecurity for a moment.
Fifty-six percent of all enterprise security breaches occur through a third-party supplier. This figure alone speaks to the importance of having a sound strategy to assess suppliers from the standpoint of their measures to protect their IT infrastructure and, ultimately, your data.
However, and this is even before the pandemic turned everyone’s world upside down, 74% of those responding to a survey believe that “third-party vendor selection overlooks potential key risks, with 64% saying that their organization focuses more on cost than security when outsourcing.”
How do the above findings tie into a DE&I initiative?
Suppose an area as important as cybersecurity can take a backseat to costs. Is it unreasonable to suggest the DE&I initiatives could also fall by the wayside, especially during a pandemic?
A July 31st, 2020 article headline reads: “‘It’s like we’re going back 30 years’: how the coronavirus is gutting diversity in science.”
According to the article, researchers are indicating that “job losses during the pandemic might pose ‘disproportionate existential threats’ to researchers from under-represented groups.” These groups include “women, people from minority ethnic backgrounds and those who are financially disadvantaged.”
While this might be in the world of science—an admittedly important field in battling the pandemic—how many other industry sectors are facing the same situation?
This past July, Gartner reported that “Underrepresented groups — racial/ethnic minorities, people with disabilities and women — have been disproportionately affected by the health and economic impacts of COVID-19.”
However, according to Gartner Managing Vice President, Lauren Romansky, a Gartner survey found that “only 2% of HR leaders identified DEI, by itself, their No. 1 priority in light of the pandemic.”
The above findings do not bode well for the progress of these initiatives before the pandemic.
In the hopes of stemming the tide of disengagement, Gartner is emphasizing that it is imperative to establish “a link” between DE&I and positive business outcomes.
The challenge with the Gartner article is that despite the good intentions, it fails to provide actual data supporting DE&I initiatives beyond the suggestion that people are “watching companies closely.” The implication is that when this pandemic is over, those companies that stayed the course with DE&I initiatives will have a competitive advantage over those that did not.
So, here is the question to the procurement world: in the face of pressing issues with supply chain disruption and cash flow requirements, how much importance will you place on the DE&I initiatives of your suppliers?