Companies offered advice on how to support women-owned businesses © UN Women/Joe Saad
Companies offered advice on how to support women-owned businesses © UN Women/Joe Saad

Supplier diversity: UN encourages gender-balanced buying

New advice for procurement professionals attempts to address gender inequality

The UN has launched a toolkit to help firms move towards gender-balanced procurement, as research shows just 1% of spend by governments and large corporates goes to women-owned businesses.

The kit, produced by UN Women, includes practical advice for businesses looking to diversify their supply chains to support women. It suggests a definition and eligibility criteria firms should adopt to avoid tokenism and fraud.

Ravi Karkara, deputy executive director at UN Women – which became operational in 2011 to promote gender equality – said the toolkit supports its “women’s empowerment principles”, a set of measures to help companies promote equality through the way they do business.

“Recently we worked with Citibank to create a toolkit on simple rules for procurement,” Karkara told SM. “[For example] saying 50% of our procurement practices go to women-owned businesses. The rest of the UN now does this as well.”

He added: “Procurement and advertising can change things. It’s an opportunity for procurement to advocate.”

Research by WEConnect, which identifies women-owned firms and connects them to multinational corporate buyers, uncovered the 1% statistic.

WEConnect argued that a number of forces, including the fact that women make up half the workforce and are involved in 70% of consumer decisions, mean this figure has to rise. Consumers and employees are also becoming more aware of corporate behaviour, it said.

Maggie Berry, executive director for Europe at WEConnect, told SM that in the US firms bidding for federal contracts were expected to demonstrate policies around supplier diversity, though in the UK, where there is a focus on buying from SMEs, this was not the case.

She added that the private sector was leading the way in terms of diversity and in the US bigger firms were keen to join companies that spend $1bn with diverse suppliers. Berry said firms including Pfizer, Intel and IBM were expected to make a commitment to buy from women-owned businesses.

“It’s still a private sector initiative and [private firms] are leading the way,” said Berry. “I expect in the not-too-distant future the [UK] government will be looking at this and taking the best practice from the private sector.”

She added: “We are looking to increase the contribution that women-owned businesses make to the economy. We have got some amazing businesses and we want them to win bigger contracts so they can grow and generate economic growth.”

Sandra MacQuillan, chief supply chain officer at Kimberly-Clark, said diverse suppliers were valued at the firm.

She told SM: “It’s inspiring to see organisations like UN Women taking steps to help companies further grow and improve their partnerships.”

Walmart is among the other big names to make commitments to supplier diversity. The retail giant recently announced it had reached a target of spending $20bn with women-owned businesses over five years.

CIPS Knowledge
Find out more with CIPS Knowledge:
  • best practice insights
  • guidance
  • tools and templates