“Supplier Diversity – what is that?” – the voice on the other side of the phone line asked in German. “I have heard about Diversity Management, but never heard of Supplier Diversity!”, the same voice exclaimed. I wasn’t surprised. I had spent the last four weeks contacting German corporates and trying to get through to their Diversity and Inclusion department or to their Procurement department in order to invite them to the first European Supplier Diversity Conference which was held in Berlin on the 21st November 2017. Nearly all of my calls resulted in a long conversation with me explaining Supplier Diversity and Inclusive Procurement and my counterpart trying to figure out why this might be important to their business. After my five-minute monologue about the history of Supplier Diversity in the US, its expansion in other countries like the UK, South Africa, Canada etc and its economic and social importance, the voice interrupted me and said, “I understand – but do you think Germany is ready for this?”
After my five-minute monologue about the history of Supplier Diversity in the US, its expansion in other countries like the UK, South Africa, Canada etc and its economic and social importance, the voice interrupted me and said, “I understand – but do you think Germany is ready for this?”
Interestingly, this is the same question that Mayank Shah, CEO and Founder of MSDUK (Minority Supplier Diversity UK) had asked me around two years back when we first started talking about the possibility of launching a German division of the organisation. Mayank and I decided that the best way to know if Germany is ready is to carry out research and present the findings at MSDUK’s 10th year celebration. I spent a couple of months trawling through a huge amount of research papers, publications, articles on the web and newspapers – literally anything that I could find on this subject in Germany. I read studies carried out by the Friedrich Ebert Foundation talking about the economic value of migrant-run businesses in Germany, reports by the German Chamber of Commerce about how migrant-run businesses enrich the German society and 195 pages of in-depth research carried out by the Federal Ministry for Economic Affairs presenting statistics about the ongoing growth of migrant-run start-ups in Germany.
What became apparent is this – Germany is ready for Supplier Diversity!
But there is a subtle difference. Whilst Supplier Diversity programs in most countries focus on helping ethnic minority businesses, the same doesn’t apply to Germany. The beneficiaries for such a program in Germany are migrant-run businesses as these are the ones that are underrepresented. The reason behind this is actually quite simple. In the USA for example, prejudice or negative bias against people with different ethnicity, especially the colour of the skin, lead to underrepresentation and discrimination. In Germany however, immigration is the main factor when it comes to prejudice or negative bias. A white immigrant from Romania or Argentina might be subjected to the same prejudice as an immigrant from Turkey or Pakistan.
When you look at the numbers it is even more evident why Germany is ready:
- 1 in 5 residents in Germany have a migrant background (without even counting refugees)
- 1 in 5 self-employed in Germany are migrants
- 1 in 5 employees in the SME sector work for a migrant-run business
- 1 in 5 new businesses set up in Germany is by someone with a migrant background
- There are around 800,000 self-employed migrants in Germany
The list goes on and on…
I presented my findings at MSDUK’s annual conference in London last year to a group of corporates and we all agreed that the proof of the pudding is in the eating. We need to sit down with German lawyers and work on the “definition” for the beneficiaries in Germany. We need to contact policy makers in Germany to determine if we have their support (or lack thereof). We need involve German academics and get more recent facts and figures.And last but not least – we need to talk to German corporates and migrant-run businesses in Germany to get their point of view.
The outcome was the first European Supplier Diversity Conference in Berlin on the 21st November 2017.
Part 2 will be available in January Network News.