In honour of Pride Month, we highlight the impact of diversity and inclusion in the supplier selection process. By embracing diverse suppliers, we unlock the potential to fuel innovation and foster a flourishing business ecosystem.
We spoke with Nestlé UK and Ireland's Head of Procurement, Matthew Beddoe, who is working hard to showcase the value of diverse suppliers.
What motivated Nestlé to prioritise diversity and inclusion in its supplier selection process?
A key contribution to ensure the creation of an inclusive and diverse society is positively impacting underrepresented communities. Nestlé UK and Ireland aims to achieve this internally and externally, which led me to question how we can implement this with our external suppliers. Looking into this further, the concept began with the U.S. originally, but more recently, has spread to the UK and Ireland.
We had been doing some work with Social Enterprise already, and it felt like a natural extension of this to bring in more diverse suppliers to Nestlé. I connected with WeConnect and MSDUK who shared their ethos with us, and I thought we need to be a part of this! Supplier diversity is sourcing from businesses where 51% of the business is owned by a historically under represented group (such as women, ethnically diverse, disabled or LGBT+ people).
We worked with the Diversity, Inclusion and Belonging team to ensure it links strongly with our corporate commitment of inclusion, diversity and being a force for good. We developed our local procurement policy, ensuring we are fair in our selection process and don’t introduce a different bias. It’s an opportunity to bring in more diverse suppliers who do what they do well and enhance our business through this diversity.
Are there specific measures or criteria involved in assessing a supplier’s commitment to diversity and inclusion?
Yes, we currently use membership of external accreditation to validate if a supplier is diverse (51% owned) through three organisations: MSDUK (Ethnic Minority Owned), WeConnect (Women Owned), OutBritain (LGTBQ+), or is a Social Enterprise whose businesses must give at least 50% of its profits to its mission.
We then measure the spend with suppliers that are certified with those organisations. When we review a category of spend, our buyers work with our stakeholders to look at those four organisations to see whether they are diverse suppliers who can be included as part of that process. So, through people in the business naturally looking to spend money (particularly new spend), our procurement team will help them draw up an appropriate list of suppliers which include diverse suppliers.
Can you provide examples of initiatives which Nestlé has implemented to promote diversity and inclusion among its suppliers?
As well as our own direct spend with diverse suppliers, we are working with some of our existing suppliers in marketing, facility management and external events as they have suppliers that supply them (tier two). These suppliers can leverage their supply base to increase our reach of diverse suppliers and bring more spend through their supply chains.
Our facility management provider Sodexo are part of the Corporate Buy Social Challenge, who along with ourselves and other corporates, aim to spend £1 billion with Social Enterprise by 2026. We are also connecting with the rest of our existing supplier base to share the supplier diversity journey, which might encourage existing suppliers who meet the criteria to join MSDUK for example, as they will then benefit from a wider corporate supply base which will expand their business. Alternatively, it could also encourage our bigger suppliers to start their own diversifying program through education.
Ultimately, all touchpoints along our value chain should aim for the inclusion of diverse suppliers, at Nestlé we do everything in our power to encourage this beyond our direct spend.
What benefits do you believe are associated with working with suppliers who prioritise diversity and inclusion? Are there any examples of which you are proud of?
The benefits are clear from two perspectives. From an economic standpoint, as we begin to spend money in different places, we can reach various communities. From a growth perspective, as we work with businesses that bring diversity of thought this will support our success by delivering a wider knowledge of expertise, the drive of innovation, the fostering of creativity, and the potential for better problem-solving.
As one of the largest food and beverages companies in the UK and Ireland, spending money in a more representative way helps towards creating more equitable economic activity for the UK and Ireland. In our offices, our supplier Sodexo can offer some examples - Hey Girls who donate one period product to someone in need for every one bought, have donated 30,219,583 period products to people in need, as of January 2023. Ollies Olives donate a free school meal for every pack of olives bought, and Fruitful Office plant one fruit tree for every fruit basket sold. In April and May, Nestlé spend planted 179 trees.
We have introduced Nuneaton Signs to some of our factories where they employ people with disabilities (71% of their workforce have disabilities). For Pride month in 2023, we partnered with suppliers from OutBritain for our Pride activities such as hosting our internal event, creating banners and even professional photography.
What made you proactively take action to drive inclusion and diversity?
I genuinely believe the right thing to do is to be inclusive. This is an opportunity to extend Nestlé’s reach into the community and make a genuine difference. This is about us looking internally and externally at ourselves and how we change the organisation to be inclusive through our role modelling through connecting with different initiatives across our industry.
What more do you wish to achieve?
We want to spend more, and work more, with more diverse suppliers. We currently have 31 diverse suppliers, and we want to reach 40 by the end of the year. We spent £1.2 million last year, we are looking to double that this year, and reach at least £5 million by 2025.
From an internal perspective, we really encourage all functions across the business to reach out to procurement and challenge us on how we can better increase our spending to drive diversity and inclusion. This is how all our employees can make a positive tangible difference to society and the communities in which we operate.