TORONTO—Most organizations in the Greater Toronto Area (GTA) are not actively seeking to spend money with companies owned by visible minorities, according to a report released today, called Supplier Diversity in the GTA: Business Case and Best Practices. While 73 percent of the organizations under study—some of the GTA’s largest—have employee diversity programs, only 13 percent have supplier diversity programs. These companies account for at least $100 billion in spending annually, or about 33 percent of the region’s economic activity.
Not having a supplier diversity program in place is a missed opportunity, the report’s author said.
“Supplier diversity makes good business sense. Companies that ensure they have the most bids when they are making their purchases will get the best price,” said Dr Paul Larson, CN Professor of Supply Chain Management, University of Manitoba. “Billions of dollars are spent in the region of the GTA, dollars that can create opportunities for small businesses.”
The report finds that the corporate sector is more open to supplier diversity than the non-profit or government sectors. As well, those GTA organizations with operations in the US are far more likely than other organizations to have supplier diversity programs. The report also compares the GTA to the region of Chicago and finds Chicago companies are three times more likely to have a supplier diversity program. The report recommends that the leadership of large GTA organizations make a commitment to this issue, train their staff, set targets, and develop partnerships with organizations, such as the Canadian Aboriginal and Minority Supplier Council (CAMSC), to help them set up their program. The report highlights the following benefits of supplier diversity:
- Results in better value for money by having more competition for bids
- Helps companies reach new markets or provide new products
- Increases investor confidence and access to capital
- Improves the organization’s reputation with customers resulting in increased sales
- Improves the organization’s reputation with employees resulting in increased staff retention
- Helps small and medium-sized businesses grow, creating opportunities for the region
- Builds the capacity and profile of visible minority leaders thereby increasing leadership diversity overall
Supplier Diversity in the GTA: Business Case and Best Practices is the sixth report in a series called DiverseCity Counts that commissions research measuring the levels of diversity in leadership in the GTA. Click here to download the full report.