Empowering Social Entrepreneurship through Supplier Diversity

The business landscape is always evolving, and with the urgent need to focus on sustainability, supply chain professionals must expand their roles beyond traditional KPIs and boundaries. One area where supply chain management can make a significant impact is social entrepreneurship—a space where innovation meets social and environmental responsibility. By leveraging supplier diversity initiatives, supply chain professionals can drive economic inclusion and bring positive change, thereby empowering social entrepreneurship.        

What is Social Entrepreneurship and Supplier Diversity?

Social entrepreneurship is the practice of applying entrepreneurial principles to find innovative solutions for social and environmental issues. It involves building and managing businesses that are not only financially viable but also aim to generate a positive impact on society at large by solving social, cultural, or environmental problems.

Example of social entrepreneur : https://cppgg.uk.gov.in/wp-content/uploads/2022/11/138_Agragami_SDG-goalkeeper-award-2021-SDG-8-Parvatiya-Chai-Utpadan-Swayat.pdf

Supplier diversity complements this as a business strategy that incorporates a wide variety of suppliers into a company's sourcing and procurement activities. It actively seeks to engage suppliers from underrepresented groups, including minority-owned, women-owned, veteran-owned, LGBTQ+-owned, and small businesses. The aim is to enhance economic inclusion, stimulate innovation, and create a more equitable business environment by offering diverse suppliers the chance to compete and thrive.

Industry examples on supplier diversity programs empowering Social Entrepreneurship

Across the world, organizations are focusing on supplier diversity to support economic inclusion, promote innovation, align with social and environmental values, meet regulatory, stakeholder expectations and contribute to social entrepreneurship.        

• Coca-Cola: 5by20 program provides women entrepreneurs with business training, access to financial services and connections with peers and mentors. This includes supporting women-owned businesses that supply goods and services to the company.
• Unilever: Unilever has a comprehensive supplier diversity program aimed at enabling economic inclusion and supporting diverse suppliers, including social enterprises. Through their initiatives, Unilever provides opportunities for small and medium-sized enterprises and social entrepreneurs to become part of their supply chain. This approach helps these businesses grow and scale, while also contributing to local economic development and promoting sustainable business practices.?
• Walmart: Walmart's supplier diversity program focuses on empowering diverse suppliers, including minority-owned, women-owned, and veteran-owned businesses1, which can often include social enterprises.

The role of supplier diversity in social entrepreneurship

Supplier diversity is more than just a procurement strategy; it is a catalyst for social change. This approach enriches the business ecosystem with fresh perspectives and innovative solutions, thereby promoting social entrepreneurship.?        

Key areas through which supply chain professionals can support social entrepreneurs include:?

• Strategic Sourcing: Identify suppliers whose business principles are driven by social impact. Involve a diverse range of suppliers in the procurement process, with a special focus on those who contribute to social and environmental goals.?
• Supplier Development: Establish mechanisms to provide mentorship and other required resources which can help suppliers to enhance their skills and competitiveness, aligning with the broader objectives of social entrepreneurship.?
• Contracting Opportunities: Create bidding opportunities for projects with a social or environmental focus, allowing diverse suppliers to contribute to impactful initiatives.?
• Networking and Collaboration: Facilitate connections and partnerships between diverse suppliers and organizations working towards social change, fostering innovation and expanding market access.?
• Community Engagement: Understand and align with the needs of communities where diverse suppliers operate, ensuring that supplier diversity efforts contribute to local empowerment.?

An approach to developing Social Entrepreneurs

Supply chain professionals can nurture social entrepreneurs by helping them to:?

1. Define the Mission: Identify social issues and create a comprehensive map of the ecosystem to find innovative solutions leading to social and environmental impacts.?
2. Enable Change: Collaborate to develop a theory of change, analyze impact measurement approaches, and recommend strategies for change.?
3. Plan for Sustainability: Focus on impact as the primary value proposition of the model and build and evaluate business models that support this goal.?
4. Support Execution: Understand the methods to scale for larger impact and articulate ways for involvement in social entrepreneurship.?
5. Measure Impact: Collaborate with social entrepreneurs to assess societal impact, create case studies, and track progress for continuous improvement.?

Summary

Integrating supplier diversity into supply chain management is not just about meeting business KPIs or compliance—it is about doing good business in a way that impacts society. By supporting social entrepreneurs, supply chain professionals address pressing issues such as human rights, poverty, and social exclusion. The aim is to build more equitable and ethical global business ecosystem where economic growth and social progress go hand in hand. As supply chain professionals in this field, we must lead the change and take the responsibility to use our expertise to empower those who are driving social change. Let's embrace this challenge and make a difference, supporting one social entrepreneur supplier at a time.        

Author : Sandeep Karki, CPSM?

A supply chain professional aspire to contribute to the industry by building solutions that integrate supply chain management, sustainability, and artificial intelligence to positively impact businesses and society at large.

Disclaimer : Views expressed in this article are my personal views and do not represent the views of Ernst & Young LLP or other members of the global EY organization.

Reference/Citation :

1. https://fastercapital.com/keyword/3-people.html/3

2. https://www.coca-cola.com/pk/en/about-us/faq/what-is-5by20-0

3. https://www.unilever.com/sustainability/equity-diversity-and-inclusion/promoting-diverse-suppliers

4. https://corporate.walmart.com/suppliers/supplier-inclusion

5. Image (Intel) : https://www.intc.com/news-events/press-releases/detail/1617/opinion-intel-surpasses-first-2030-goal-2-billion-in

6. Image (JLL): https://www.jll.com.au/en/trends-and-insights/workplace/how-companies-are-partnering-with-suppliers-to-deliver-social-impacts

7. Image (DCMs) : https://www.gov.uk/government/publications/dcms-action-plan-to-engage-the-voluntary-community-and-social-enterprise-sectors-in-its-supply-chain/dcms-action-plan-to-engage-the-voluntary-community-and-social-enterprise-sectors-in-its-supply-chain

8. Image (Coca cola) - https://www.coca-colacompany.com/social/supplier-diversity

9. Approach to developing social entrepreneurs - https://plusacumen.novoed.com/#!/courses/social-entrepreneurship-2023-4/lecture_pages/2308969

10. GenAI tool has been used to check, correct English grammar and spellings errors in the article. Additionaly,Turniitin similarity check has been performed to cite all possible references. If still any reference left out, please inbox me, I will add.