Organisations are turning to supplier diversity programmes to enhance their brand image, a new study shows.
It claims that the business value of supplier diversity remains “strong and broad”, with companies investing in supplier diversity to enhance their brand image (53% of respondents), win new business (46%) and to align with corporate culture and workforce inclusiveness (81%).
The report also claims diversity is helping drive ESG performance (55%), and adds that enterprises see supplier diversity as “a value-generating supply chain strategy”. Also, most (69%) say current economic turbulence has had minimal impact on their supplier diversity programs.
Meanwhile, two thirds (66%) cite supply chain competitiveness – cost savings, risk reduction and innovation – as a primary driver for their supplier diversity program.
Compliance less of a supplier diversity driver
The research also finds few organisations are investing solely for corporate, regulatory or societal requirements, with customer requirements (33%) and government compliance (27%) both down as diversity drivers compared to recent years.
“Supplier diversity remains an intentional and essential supply chain strategy,” says Aylin Basom, CEO of Supplier.io. “Our research shows wide-ranging investment in diverse businesses of all types, including SMEs, veteran- and women-owned businesses, and minority-owned organisations.
The report is based on insights from “hundreds” of respondents, 67% of whom work at organisations with revenues of $1 billion or higher.
Data is “the pillar of supplier diversity”, says supplier.io, with 67% now using third-party data services to improve supplier diversity programs, a 44% increase on 2022. More than half (56%) report that diversity data has improved compared to last year.
“Reliable data remains the lifeblood of supplier diversity programs,” adds Basom. “Our research finds three of the top four challenges associated with supplier diversity programs relate back to data.”
This, she says, “correlates to the increased adoption of third-party sources we’re seeing across the market”.
She adds: “Supplier diversity is now a driving force in ESG strategies and outcomes, especially across the supply chain.”