What is supplier diversity?
The world is connected through global and local supply chains, and many national/multinational companies have recognized the value of expanding their scope to include diverse suppliers, mostly SMEs*. The reasons for making diverse supply chains a priority range from social responsibility to corporate objectives to the desire to be competitive and dynamic market leaders.
Supplier diversity is a business strategy that procures, values, and promotes products and services from diverse suppliers. A diverse supplier is an SME that has a percentage of people from a traditionally marginalized or underrepresented group – in this case LGBTIQ+ people – in its management and operates as a legally registered SME.
Why is supplier diversity important?
When businesses proactively source goods and services from SMEs that are LGBTIQ+ and managed by LGBTIQ+ people, they unleash innovation and creativity through diversity, while reflecting the demographics of the communities in which the businesses operate. This in turn creates the potential to expand the customer base and enter new markets, while creating opportunities for LGBTIQ+ suppliers to grow their business.
A commitment to work with these diverse suppliers not only allows LGBTIQ+ SMEs to grow their business, but also offers the opportunity to benefit the LGBTIQ+ community through the creation of new jobs, higher wages, and increased visibility.
In addition to the growing interest of multinational companies, more and more investment groups are also interested in investing in companies that are committed to supplier diversity.
What are the benefits of developing diverse supply chains?
Since the Supply Chain Act (LkSG) came into force on 1st January 2023 in Germany, corporate responsibility for respecting human rights in supply chains has been regulated for the first time. LGBTIQ+ rights fall under human rights.
Diverse supply chains provide multiple channels for sourcing goods and services, promote healthy competition between existing and potential suppliers, and highlight previously untapped potential. In this way, they create new opportunities for SME expansion in the face of new consumer needs based on changing demographics.
Why are diverse supplier registration and certification important?
Registration and certification are the process by which an SME can have its status as an LGBTIQ+ supplier confirmed by a recognized independent body. This legitimizes the position of LGBTIQ+ SMEs in the diverse supply chain and enables companies sourcing goods or services from these SMEs to report on spending on diverse suppliers and promote their corporate commitment to supplier diversity.
What are the benefits for LGBTIQ+ SMEs?
LGBTIQ+ SMEs are often best placed to deliver innovation as they tend to be smaller and therefore more flexible and can change and adapt quickly to new business needs.
Other advantages of being part of the diverse supply chain include:
- Strengthening LGBTIQ+ SMEs in the economy
- Increasing social acceptance of LGBTIQ+ people in the business environment
- Valuing supplier diversity as a lever for economic growth
- Promoting SME growth and opening up new business opportunities
- Helping people to come out in business
What do we want to achieve?
- We want to increase the visibility of European LGBTIQ+ businesses so that they become a relevant group in their local business environment.
- We want to increase the social acceptance of LGBTIQ+ people in the business world so that they can become influential players in their business world.
- We want diversity to become a relevant value in the business world, leading to strong collaborations and creating unique business opportunities.
- We want to make it clear that coming out in business is not a threat to existing successes, but that it is just as valuable as coming out in person, it makes businesses stronger, more authentic and more successful.