What is Business Sustainability Today?

 Historical Context

Over the past 50 years, the journey to embed Supplier Diversity, Small Business Utilization, and Diversity, Equity, and Inclusion (DEI) into the heart of our organizations has encountered various challenges. These hurdles often stem not from direct opposition but from a disconnect, insufficient education, and a need for more understanding regarding the impact of these initiatives on everyone involved.

Here’s a brief overview of our journey over the past four years (2020-2024):

2020: A Breaking Point

2020 marked a pivotal moment for DEI, reverberating throughout the Supplier Diversity landscape. The COVID-19 pandemic disproportionately affected underrepresented groups in the United States, laying bare significant social, health, and economic disparities. Concurrently, the social justice movement ignited by the murder of George Floyd thrust systemic discrimination into the spotlight. Organizations felt compelled to address public relations pressures by cultivating a more diverse, equitable, and inclusive workplace, alongside committing resources to initiatives to narrow the racial wealth gap.

2021-2022: Renewed Focus and Commitments

In response to the challenging events of 2020, numerous organizations reaffirmed their commitment to Supplier Diversity, Small Business Utilization, and DEI. They made public pledges, launched training programs, and committed billions of dollars to address the racial wealth gap. The establishment of dedicated DEI roles and councils underscored this renewed commitment. However, progress could have been faster, and some initiatives faced criticism for needing more depth and authenticity.

2023: The Emergence of the Divisiveness, Exclusion, and Inequity (DEI²) Movement

By 2023, a significant movement also emerged against the traditional ethos of DEI initiatives. This shift was fueled by economic uncertainty, corporate budget constraints, court rulings, and legislative efforts to dismantle diversity programs. Key developments during this period included:

·       There was a concerted push by people to restrict or eliminate the application of DEI principles, with 66 bills proposed across 36 states and Congress to limit these policies.

·       The Supreme Court's decision to overturn affirmative action in college admissions raises alarms about the future of DEI, which would inevitably impact the spirit of Supplier Diversity.

·       A 123% increase in 2020 DEI job listings was followed by a 48% year-over-year decline in hiring for DEI roles, suggesting a potential shift in organizational priorities traditionally focused on DEI.

Opponents of DEI called for increased scrutiny and exerted significant pressure on established DEI advocates to demonstrate the tangible benefits of existing DEI programs.  This pressure stressed the need for greater metrics and more compelling success stories to highlight the efficacy of how these programs impacted innovation, customer engagement, revenue, and profitability.  In response, DEI advocates began to adopt more data-driven justifications that not only underscored the financial relevance of DEI but illuminated the diverse perspectives and ideas that varied teams bring to the table. 

The movement for supplier diversity has expanded from its original narrow emphasis on businesses owned by ethnic minorities to encompass a more inclusive approach. This shift has reprioritized small business utilization strategies that traditionally concentrated primarily on race, gender, gender identification, disability, or veteran status. Today, organizations are now encouraged to engage with companies that can prove historical marginalization, regardless of owner classification. By highlighting this socioeconomic differentiation, DEI, and Supplier Diversity professionals are encouraged to develop more impactful policies that foster significant socioeconomic and environmental benefits within the communities they serve. 

To make meaningful progress, we must shift our focus from merely categorizing individuals and businesses by acknowledging how these concepts overlap and the collective impact they can achieve when considered holistically.

DEI

The D stands for Diversity and focuses on recognizing and valuing individual differences, such as race and gender. The E stands for Equity, which focuses on fair treatment of people and access to opportunities for all, addressing barriers that hinder participation. The I stands for Inclusion, designed to create welcoming environments where everyone feels valued and can fully engage. Together, DEI initiatives strive to foster a more just and equitable society by tackling systemic inequalities that promote inclusion and respect.

Supplier Diversity / Small Business Utilization

Supplier Diversity and Small Business Utilization are kin to each other but address the same issues differently.  Both strategies enhance inclusivity and drive economic growth by engaging a more comprehensive range of suppliers. Supplier Diversity focuses on partnering with businesses owned by underrepresented groups to create a more representative supply chain, fostering innovation and competitiveness. Small Business Utilization emphasizes the importance of engaging small businesses, which are often more agile and innovative than large organizations with over 500 employees, thus supporting local economies and job creation. Both strategies help build a resilient, sustainable supply chain that benefits our economy.

Environmental Sustainability

Environmental sustainability for businesses involves adopting practices that minimize environmental impact and promote long-term ecological balance in the communities in which your business operates or serves. This includes efficient resource use, pollution reduction, sustainable sourcing, lifecycle management, and investing in clean technologies. By integrating these practices, businesses can support a healthier planet while benefiting economically and socially.

2024: Reframing the Conversation - Business Sustainability 

The notion that Environmental Sustainability, Supplier Diversity, Small Business Utilization, and DEI can be treated as separate challenges—each independently addressing issues such as environmental mitigation, workforce inclusion, waste reduction, recycling, and integration of small businesses into a supply chain—overlooks their interconnectedness. These challenges cannot be effectively resolved in isolation. Our persistent efforts to tackle these issues independently often reflect a superficial approach, addressing symptoms rather than the underlying root causes. This failure to recognize how our business practices and resource allocations perpetuate inequities exploits people and the planet, leading to excessive waste and rising costs that ultimately threaten profitability.

Consider this: the solution lies within the problem itself. How can you create products or solutions that support individuals, rejuvenate the planet, reduce waste, lower operational costs, and enhance profitability sustainably rather than linearly?

While it may appear that business owners and corporate professionals should focus exclusively on maximizing profit, this narrow perspective often neglects the significance of nurturing a positive and inclusive workplace and creating goodwill—both of which are vital intangible assets that enhance any company’s value. Simply prioritizing profit does not cultivate loyal advocates; it may attract followers, but true loyalty stems from a deeper connection and commitment to an organization that generates both tangible and intangible value. 

 

Building sustainable businesses necessitates a shift in mindset that transforms operational practices, regardless of whether one is a micro, small, or large enterprise. This holistic approach circumvents linear decision-making and resource allocation that could negatively impact people or the planet, enabling a company always to think future-forward. Such innovation fosters competitive advantage and distinguishes them from the crowd, creating new value, extending organizational longevity, and enhancing returns.