Diversity Pays Off in Business
California may be acquiring a more diverse work force and customer base, but the shared goal of creating more prosperous communities remains as important as ever. It’s just logical that a climate of inclusiveness would best serve our mutual interests. We see evidence of that in continuing public and private efforts to embrace diversity in hiring and awarding of contracts. It makes good sense and good business.
Take the latest example: One day after Gov. Pete Wilson issued an executive order to abolish the affirmative action program that helped women and minorities secure state contracts, the federally funded Alameda Corridor project voted to give small “disadvantaged” firms 22% of the contracts for construction of the $2-billion high-speed rail link between the ports and downtown rail yards. That is more than double the requirement for federally funded projects, which are unaffected by Wilson’s action, taken under Proposition 209, the state initiative that ended affirmative action in state contracting, hiring and college admissions.
The city of Los Angeles too attempts to grant 22% of its contracts to disadvantaged businesses, via an outreach program that has withstood court challenge and is not affected by Proposition 209.
Other federal outreach programs, such as the Small Business Administration’s plan to increase the share of women-owned businesses in federal contracting, continue unaffected as well. The SBA wants to end the practice of bundling federal contracts into one large bid, which shuts out the small businesses that are more likely to be owned by women or minorities.
In the private sector, there is increasing outreach as companies realize it is to their advantage to buy from suppliers who reflect their customer base. Minorities and women obtained about $30 billion in business from the 500 largest U.S. companies in 1996, compared with $22 billion in 1990.
The changing demographics in California and the nation require companies and governments to do business in new ways and provide new business opportunities as well. Why not expand the pie for everyone? That seems to be too much common sense for some state politicians; fortunately, few people are following their lead.
