Doing the Right Thing with Our Supply Chain

Over the last four years of doing our annual Supplier Citizenship Survey, we have grown the response rate tremendously. In 2020, we had more than 760 suppliers provide data and information on all Citizenship areas, which represents approximately 50% of P&G's global supplier spending. We have seen more suppliers improve in the areas of Environmental, Social and Governance (ESG), with 72% indicating they publish a sustainability or Citizenship report. And we continue to drive inspiration and action across the Citizenship areas. In April 2021, we had our first Global Virtual Supplier Summit which was viewed by more the 1,500 external participants and internal stakeholders. Through this two-hour event, we heard from P&G leaders, including Ana Elena Marziano – Chief Purchasing Officer, Shelly McNamara – Chief Equality & Inclusion Officer and Virginie Helias – Chief Sustainability Officer, about P&G's response to the pandemic and our focus areas going forward. The Summit was followed by a series of 11 workshops through which P&G and our partners shared tools and ideas on how our suppliers can join the journey on Equality & Inclusion, Sustainability and Supplier Diversity. We continue to believe in the importance of sharing P&G strategies and action plans with our key partners, so together we can have significant positive impact on the people in our supply chains, communities and planet.

Supplier Diversity

When our supplier ecosystem reflects the diversity of our consumers, our business grows and the communities in which we live and operate thrive. P&G’s Supplier Diversity program in the U.S. aims to spend with businesses owned by minorities, women, LGBTQ+, people with disabilities and U.S. veterans. Now with the expansion of Supplier Diversity, we are tracking spend with women-owned and women-led suppliers globally, too. We are proud to have spent almost $3 billion with this group of diverse suppliers in fiscal year 20/21, across first and second tiers. Supplier diversity is a competitive advantage for us, and we are committed to drive economic empowerment across our end-to-end supply chain. Therefore, it is important that we recognize and highlight the valuable diverse owned suppliers currently adding value every day to P&G’s business.

Supplier Diversity Success Story: DSI Mask Distribution

As the COVID-19 pandemic swept our country, the team at North America Market Operations Purchases was on a mission to provide safety equipment to P&G employees. We made an intentional decision to partner with a minority-owned supplier to source and distribute masks to P&G operations. We selected DSI as our partner due to our long relationship and the company’s ability to be creative and nimble. While P&G provided a guarantee for their first order, DSI worked with P&G connections — equipment suppliers and carriers — to quickly build inventory. They subsequently shipped into all our U.S. sites and are qualified to ship to Canada. DSI has built relationships with our sites, which is leading to other opportunities for business growth beyond masks. For P&G, this was a successful partnership because DSI leveraged their expertise to make and distribute masks at a cost lower than what we could do ourselves.

Supplier Diversity in South Africa

Building sustainable supply chains also means it is also important to invest in the future pipeline of diverse-owned suppliers, so we partner with many organizations to build capabilities of diverse small business owners and startups. This has come to life in a meaningful way with the hard work of our P&G team in South Africa. We currently work with more than 175 local suppliers that are Broad-based Black Economic Empowerment (BBBEE) compliant. We also partner with WEConnect International to develop local diverse-owned businesses by leveraging the experience and know-how of local P&G employees, sharing best practices and tools with entrepreneurs in the country. Learn more here.

Diversity in Marketing

We also have focused efforts in our Marketing space to ensure we are growing the diversity of talent behind and in front of the camera. All of this work is to build a more diverse and inclusive supply chain through which P&G can deliver superior products to our diverse consumers around the world.

Recognition for Our Hard Work

Supplier inclusion in our Citizenship work is a clear business imperative because we know that having a diverse supplier ecosystem delivers a more resilient supply chain, allowing us to respond to evolving consumer and customer needs. We are proud that the following external organizations have recognized the hard work of so many P&G employees on our Supplier Diversity growth over the years:

• CEO of the Year: Awarded by the National Minority Supplier Development Council (NMSDC)
• Top Corporation: Awarded by Women’s Business Enterprise National Council (WBENC)
• Top Global Champions for SD&I: Awarded by WEConnect International

Responsible Sourcing

At P&G, we aspire to be a company that extends our PVPs throughout our supply chains in partnership with suppliers. We have increased investment in the foundational work of assessing and monitoring human rights and environmental risks in our supply chains. A corporate cross-functional team is working to refresh policies and processes to evaluate, identify and remediate risks by collaborating with our business units and suppliers. This includes deepening our understanding of our supplier locations and materials and services that would benefit from audits and other due diligence tools. These due diligence tools support our efforts to engage with partners with high ethical standards, in line with P&G Responsible Sourcing Expectations for External business Partners.