Supplier diversity: bringing new voices to the table and effecting change in communities

When we work with clients to build a supplier base, we aim to bring forward the best contractors from our extensive networks. A crucial part of that work is introducing a diverse range of suppliers—bringing new voices to the table that contribute innovative ideas and alternative perspectives to a project.

Data consistently shows that a supplier diversity initiative can lead to more business, higher productivity and innovation, and stronger economic and social outcomes for local communities.

By encouraging the use of diverse firms—including (but not limited to) minority-owned, women-owned, veteran-owned, LGBTQ+-owned, service-disabled veteran-owned, historically underutilized businesses, and small businesses—we help bring people from a wide range of backgrounds into a company’s supply chain.

Engaging these traditionally underrepresented groups expands diversification, promotes vendor competition, and strengthens competitive advantage.

“Setting up a supplier diversity program takes time, but it is vital to implement in order to create and nurture fruitful partnerships that support the growth of diverse firms.”

Implementing a supplier diversity program 

To successfully implement a diverse supplier program on a project, there are six key steps that need to be taken:

1. Encourage buy-in from the leadership team: A client’s senior leadership needs to understand that diversifying its contractor base is a business imperative.

2. Change company culture: We want clients to recognize that diverse companies often bring more innovative solutions, and by engaging them as true partners, we can bring new ideas to their attention. 

3. Engage local diverse businesses: We connect with underutilized businesses by targeting networking events, local membership organizations, and statewide directories of certified firms.

4. Build capacity within the client organization: We aim to change the way our clients do business—adjusting procurement processes, policies, and procedures to support more inclusive outcomes.

5. Create a data-driven program: Setting reasonable targets helps manage expectations and enables clients to track progress toward goals.

6. Incorporate compliance mechanisms: Accountability is essential across the program to ensure stakeholders remain engaged and are providing the right support.

Public sector organizations often have equity and diversity goals tied to contracting and have implemented these programs for decades. In many cases, public sector requirements shape what follows in the private sector, and we’re seeing a clear shift among the vast majority of our clients. Companies that aren’t working to diversify their contractor base risk being left behind.

We also want to help shift broader company culture, so clients recognize the value diverse firms bring—and how expanding access can strengthen reputations by creating opportunities for underrepresented groups.

“Society wants to see that large companies are spending their money in different places and supporting different types of businesses.” 

To make this work, we also need to engage local diverse businesses and help build their capacity—creating stronger business partners for us and our clients.

Demonstrable success

We’ve worked with a number of high-profile U.S. clients to engage a diverse range of suppliers and successfully deliver major projects—showing that it’s possible not only to meet supplier diversity goals, but exceed them.

Wells Fargo, for example, set a 20% goal for the use of diverse suppliers.

“Thanks to our program, we achieved 51% utilization and more than $145m of diverse capital spend, equal to 46% of the overall spending for the project.”

At Denver Airport, the client set a goal of 20%for use of diverse suppliers, and we proposed nearly doubling that—committing to at least 35% for the project.

We’re using a local minority- and woman-owned firm to support community outreach and compliance monitoring, and we’ve expressed interest in Denver’s upcoming mentor-protégé program, which will further build the capacity of diverse firms that participate.

Building a benefits cycle 

By partnering with small and diverse firms, we help create future opportunities for these businesses to compete for major contracts beyond their work with us.

“Companies that partner with us get the chance to enhance their capabilities, and often gain access to future work because they can demonstrate experience of tackling large, often complex, projects.”

But there is an even broader benefit: in the U.S., our supplier diversity efforts often focus on ethnic and gender goals, and we see that engaging these companies can have a ripple effect in local communities.

For example, Hispanic-owned firms tend to employ more individuals of Hispanic descent; Black- or African American-owned firms tend to employ individuals of African descent; and women-owned firms similarly. This means that dollars spent by large companies through contracting with smaller businesses are circulating through a much more diverse group of people. Those businesses and employees pay taxes, spend money locally, and help create a cycle of change that improves economic outcomes more broadly.

People increasingly expect large companies to implement inclusive initiatives and support different groups through business engagement and meaningful opportunities for growth. Across the construction industry, there needs to be a stronger commitment.

Larger firms must dedicate resources to create pathways to inclusion, increase visibility for those who might otherwise be overlooked, and ensure they’re building an environment where diverse businesses can participate—and succeed.