Sandra Kerr CBE
Race Director, Business in the Community
Employers are central to addressing inequalities in the workplace and across supply chains so that everyone, regardless of their background, feels included, valued and respected.
One in five working-age adults in the UK come from Black, Asian, mixed race or other ethnically diverse backgrounds.1 Employers should work to ensure this is reflected across the UK workforce. By failing to do so, employers could be missing out on key talent.
However, the work shouldn’t stop at their own workforces; employers should work with businesses in their supply chains to ensure diversity across their wider stakeholders. There is more work needed in this area as only a third of employers currently talk to their suppliers about their diversity and inclusion strategies.2
Promote diversity across supply chains
Business in the Community’s Race at Work Charter, a public pledge signed by over 1,000 employers to address workplace race inequalities, asks businesses to commit to including ethnically diverse-led SMEs in supply chains. SMEs make up 99.9% of the UK business population,3 yet only 1 in 10 UK SMEs are led by ethnically diverse individuals.4
Evidence shows that only a quarter of UK businesses have targets to diversify their supply chain, and only a third have a senior leader responsible for ensuring diversity and inclusion across supply chains.5
Having role models from the
same background is essential.
How to diversify supply chains
There are many actions businesses can take to diversify supply chains, including setting supplier diversity targets, setting KPIs, tracking progress and monitoring and publishing procurement data to ensure accountability.6 In doing so, employees, businesses and the local economy could benefit.
Benefits of supplier diversity
A quarter of ethnically diverse employees see their ethnicity as a barrier to the next step in their career,7 so it is essential for people to see leaders from the same ethnic background in senior roles. For a third of ethnically diverse employees, having role models from the same background is essential.8 Having ethnically diverse-led SMEs in supply chains can provide these role models, who can act as mentors to ethnically diverse employees, helping them to reach their full potential.
Supplier diversity can also bring many benefits to business. Research shows that it can lead to an increase in employee engagement, profitability and workplace productivity.9 By including local, ethnically diverse-led businesses in their supply chains, businesses can support more SMEs and invest more in their local communities.10
[1] Census 2021 data
[2] Business in the Community: Race at Work Charter Survey Report 2023
[3] Department for Business and Trade: Business population estimates for the UK and regions 2023: statistical release
[4] Department for Business and Trade: Longitudinal Small Business Survey 2022: SME employers – data
[5] Business in the Community: Race at Work Charter Survey Report 2023
[6] Business in the Community: Ethnically Diverse-Led Owners in Supply Chains toolkit
[7] Business in the Community: Regional Insights on Race
[8] Business in the Community: Race at Work 2021: The Scorecard Report
[9] What Is Supplier Diversity and Why Your Business Needs It [2023] | Supplier Diversity Solutions (viva-it.com)
[10] Business in the Community: Driving Sustainability Through Procurement
