“For anybody in procurement that’s ever uttered the phrase ‘seat at the table,’ it’s not always a comfy seat. This is one of those moments where, if we want to be a part of the leadership discussion on the directional momentum of the company, we have to find the way, find the person, and find the time to have this conversation about supplier diversity.” - Kelly Barner, Co-founder and Head of Operations at Art of Procurement
In a recent LinkedIn community poll, we asked how a change in corporate DEI policies would impact procurement’s supplier diversity efforts. 45 percent of respondents said they wouldn’t change anything. Nearly 30 percent said they would keep tracking but stop advocating for supplier diversity. 20 percent said they would look to their c-suite leadership for direct guidance, and the remaining 5 percent said they would stop supplier diversity efforts altogether.
This is one data sample, but we know that this year supplier diversity is facing unprecedented scrutiny with major companies like Walmart, Google, McDonald’s, Target, and Disney walking back or rebranding their initiatives. Is this the end of an era for supplier diversity as we’ve known it? It seems so, at least for now.
That’s why Kelly Barner and I decided to tackle this issue, head-on, in this episode of the Art of Procurement podcast.
Discussing the current state of supplier diversity isn’t an easy conversation, but even though this is a tough issue to parse out, it’s an important one. Kelly and I both feel strongly – as I think most of us in the procurement community do – that procurement has to meet the business where it is at the moment and find ways to be purposeful and informed so they can provide differentiated value and strategic expertise even in times of transition or tumult.
We hope that our own conversations about the tough issues help the whole procurement community deliver continued insight and perspective to the business.
While I encourage you to listen to the full episode, which will surely be the first of many conversations we have about this developing issue, here are a few highlights from my conversation with Kelly on the state of supplier diversity in 2025:
Supplier Diversity, by the Numbers
“In the first quarter of 2022, there were 3,670 mentions of DEI and ESG programs in earnings calls. In the first quarter of 2025 so far, there have been 200. When you measure quarter over quarter, the full fourth quarter of 2024 was 712. So there's certainly been a big decline in organizations talking about these programs." - Philip Ideson
An Opportunity for Procurement to Drive the Conversation
“If we can encourage people to do anything... I think unquestionably, the right thing for procurement to do internally right now, is to have those conversations. Whether that means talking to legal, talking to HR, talking to someone in the c-suite, to say, not ‘here's what I think we should be doing.’ But ‘hey, look what's going on in the bigger picture. Let's talk about it.’ I think this is a real leadership opportunity for procurement to step up and say, ‘this is an important conversation for us to have internally before something happens and we get forced to have it externally.” - Kelly Barner
The “Why” Behind Supplier Diversity
“I think how companies are responding is really dependent upon what the “why” was for them in the first place... to invest in supply diversity programs. If you look at the companies where diversity is truly a part of that company’s corporate culture, they’re going to do one of two things: they’re going to keep on talking about it, because it’s just who they are, or they may not talk about it quite so much, but operationally it’s full steam ahead.” - Philip Ideson
Measuring What Matters
"Now is the time to be looking back and saying, by investing in supplier diversity programs, this is the benefit that we got from the suppliers that we worked with, perhaps what we think may have been harder to get elsewhere, or that wouldn't have happened without this program. Because at the end of the day... there has to be financial underpinning of investments in any of these programs. Whether it’s the environmental CSR programs, or other S programs like modern slavery, or local impact sourcing – there has to be an ROI." - Philip Ideson
The Value Beyond Politics
"Why do we do supplier diversity? Taking the politics side out of it and the brand and the PR, there are good reasons why we want to encourage and develop underrepresented suppliers, or owners from underrepresented communities or small businesses." - Philip Ideson
As these excerpts show, Kelly and I both believe that procurement can – and should – take the lead on these sensitive organizational shifts, but they can only do that when they acknowledge both the frustrations or contradictions and benefits or value that have existed within supplier diversity programs.
It’s a timely issue, and it’s time for procurement to start driving the conversation.
