Supplier Diversity at Procter & Gamble
What is Supplier Diversity & why is it important?
At P&G, Supplier Diversity has been a business strategy for over 40 years. This is our program to grow and develop
business with certified woman-, minority-, LGBT-, Person with Disability- and US Military Veteran-owned companies.
When we invest with diverse suppliers, we create value in our business by strengthening our innovation building value inour community through the job growth and economic inclusion created by these companies. We are committed todeveloping an intentionally diverse supply base by working directly with certified diverse-owned businesses, andindirectly through our majority-owned partners. While we are incredibly proud of our accomplishments – including
spending more than $2 billion with diverse suppliers for eight consecutive years – we know we must continue toinnovate and improve.
Definition of a Diverse Supplier
A for-profit enterprise that is at least 51% owned, operated and controlled by a U.S. citizen(s) who is African American,Hispanic, Native American, Asian Pacific, Asian Indian; a non-ethnic woman; Service-Disabled Veteran Owned andVeteran-Owned Small Businesses; Disabled; or Lesbian, Gay, Bisexual, and Transgender-Owned Businesses. Thecompany must be based in the U.S. or its trust territories. We require Diverse Suppliers to be third-party certified toensure they are meeting the spirit and intent of our program.
1st and 2nd Tier Diverse Suppliers must be certified by one of the following certifying organizations:• National Minority Supplier Development Council (www.nmsdc.org )• Womens Business Enterprise National Council (www.wbenc.org )• The Department of Veteran Affairs (www.va.gov )• Disability:IN (www.disabilityin.org)• National Gay & Lesbian Chamber of Commerce (www.nglcc.org )Outside the US we track spend with suppliers owned, operated and controlled by a woman. Certification is not required
if the company is based outside the US. However, we ask the company self-registers at weconnectinternational.org.
2nd Tier
P&G has had a 2nd tier program since 1996. 2nd tier purchasing provides P&G with a way to expand its commitment toDiverse purchasing by enrolling our 1st tier Majority Suppliers (P&G suppliers that are paid directly for goods or services
they provide to us) in this process. Simply put, we are asking our suppliers to utilize Diverse Suppliers in their supplychains. By utilizing 2nd tier in conjunction with our direct spending efforts we expand the impact of our Supplier
Diversity strategy. We have also begun tracking 3rd tier spend on a limited basis as our business models evolve to ensure
we are driving the spirit and intent of Supplier Diversity.
Our Expectations (What it Means for You)We make sourcing decisions based on best total value, which includes Supplier Diversity. If you are a diverse ownedcompany participating, this is part of the value proposition you provide. If you are not a diverse owned company, weexpect you to drive 2nd Tier spending with certified diverse suppliers – this will be evaluated as part of the proposal andwe will track this on a quarterly basis. For more information including videos from our leaders on P&G’s commitment,
visit the website. https://supplierdiversity.pg.com. For majority-owned suppliers, we also have a 2nd Tier toolkit thatcontains additional resources and is available from your Supplier Relationship Owner.