Why Upwork and Other Companies Are Measuring Supplier Diversity, Equity, and Inclusion

Colette Des Georges
Colette Des Georges
January 26, 2021
Why Upwork and Other Companies Are Measuring Supplier Diversity, Equity, and Inclusion

In August of 2020, Upwork and some of the world’s other leading tech companies joined SurveyMonkey’s supplier diversity initiative and pledged to track the diversity, equity, and inclusion (DEI) of the vendors they buy from. The end goal is to seek out and support businesses that share those values.

Unlike past vendor diversity programs (which typically only track minority ownership), this initiative uses a survey designed by The Justice Collective to track representation of women, racial minorities, and LGBTQ+ individuals within a vendor’s employee base, leadership team, and board of directors. It also evaluates vendor policies and practices to determine how inclusive they are.

By making this commitment, these companies are building awareness about the importance of representation and applying pressure that will hopefully bring us toward a fairer workplace. We wanted to take the opportunity to share a little more about why supporting diverse, inclusive, and equitable orgs is so impactful, why measuring is important, and what we hope happens next.

Companies led by those from underrepresented groups face more obstacles

To understand why it’s so important to support companies with diverse leadership, you first need to understand how unfair the current business landscape really is.

It starts at the fundraising level. People of color have historically been deliberately targeted by redlining as well as predatory lending, which means that they have less access to home equity and individual or family savings—which are critical for scaling a business early on. Black and Latinx communities have now been excluded from opportunities to build wealth across several generations, making it much, much harder to found or grow a business.  

Business loans from financial institutions can be equally inequitable: One study compared sources of finance and found that new Black-owned businesses start with almost three times less in terms of overall capital than new white-owned businesses. Additionally, women are substantially less likely than men to start new businesses, and when they do, they apply for significantly smaller loans than men.

Even business leaders from underrepresented groups that didn’t found their own companies have an incredibly steep path toward leadership as they overcome restricted job opportunities, lack of access to mentorship and other resources, and general bias. As of December 2020, there are only 37 female CEOs in the Fortune 500 and three Black CEOs. The same obstacles, to a slightly lesser extent, impact every member of an underrepresented group in the workforce.

In spite of all these barriers, diverse groups of people do find their way into the business world and into leadership positions. And when they do, they ease the path for those who come after them. That’s why supporting the companies they work for is so important.

Measuring gives deeper insight and creates accountability

Many companies agree that “things need to change,” but it’s hard to know where to start. For all the reasons listed above, there tend to be fewer companies led by people of underrepresented groups and options for a specific good or service might be limited.

Yet companies can still make a major positive impact by prioritizing vendors that emphasize diversity, equity, and inclusion. The survey Upwork and other partners are using to assess possible suppliers includes questions about internal inclusion initiatives, corporate social responsibility work, diversity hiring goals and more. Not only does the survey help companies select vendors that share their values, it also sends the message to suppliers that DEI is a business necessity.

Some companies offer employee resource groups, special mentorship programs, or recruiting initiatives. Others celebrate a diversity of holidays. Still others offer mental health programs and other benefits that show how much they value their employees. Exchanging information within a vendor ecosystem can help businesses inspire each other and even share resources.

Of course, the survey also provides accountability. Measuring alone doesn’t magically provide a diverse supply chain, but it is a critical first step in understanding the vendor landscape and tracking improvement over time. Businesses might choose to invest more in diverse suppliers, better support the suppliers they already have, or simply use the information to keep things in perspective. Either way, it’s a step in the right direction.

Companies that value DEI are more ethical and perform better in the long run

When it comes to choosing which vendors to buy from, companies that have taken the pledge have to strike a delicate balance between finding the solution that most closely meets their needs and the businesses that more closely. Luckily for them, there is actually a fair amount of overlap between companies that prioritize DEI and companies that perform well.

According to McKinsey, companies that are in the top quartile for diversity are also 21% more likely to have good financial performance than companies in the bottom quartile—probably as a result of having a broader understanding of needs of the market as a whole. Diversity has also been correlated with higher rates of innovation.

In short, diverse businesses may prove more valuable in the long run—but they need partnership in order to reach their full potential. The Justice Collective recommends broadening the scope of a vendor/purchaser relationship to work more collaboratively with suppliers that meet DEI values. This might mean sharing resources with them, providing them with access to tools, or building in more lead time than usual. Given that many of these businesses face obstacles that others don’t, it may take longer to ramp up. After that happens, though, these vendors will bring an invaluable perspective.

Where do we go from here?

Change may not be quick, but the more organizations start using their budgets to insist on a more equitable workforce, the more equitable a workforce we will have.

As an industry, technology has a ways to go, but as long as companies are setting goals and holding themselves and others accountable, we will make progress. Forward-looking, inclusive companies like Upwork will lead the way.

Colette is a Content Strategist at SurveyMonkey, where she focuses on Diversity, Equity, and Inclusion and partnership content.

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Colette Des Georges
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