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05/25/2021

The Inclusivity Imperative in Food Retail

Taking innovative approaches to advancing an equity agenda
Gina Acosta
Executive Editor
Gina Acosta profile picture
The Inclusivity Imperative in Food Retail
In some product categories, such as grocery and beauty, Target has a strong representation of Black-owned and Black-founded brands, with plans to continue to grow the assortment.

Food retailers have been working to create a more diverse and inclusive workforce for decades, but a police officer’s knee on the neck of George Floyd was a turning point.  

The global protests following the killing of Floyd, Breonna Taylor and other Black Americans suggest that we’re in the midst of the largest equity and social justice movement of our time, one that’s putting unprecedented pressure on consumer-centric businesses to do more to advance equity. Food retailers are seizing the moment as they rush to apply an innovation mindset to their diversity and inclusion strategies.

Target, for example, said in April that it will spend more than $2 billion with Black-owned businesses by 2025.

“Over the last few years, we’ve listened carefully to our multicultural guests as a whole, and we recognized there was an opportunity to do more for Black guests,” Chief Growth Officer Christina Hennington said during the retailer’s fourth-quarter earnings event. “So we’ve added more brands and products that we know they love. A great example is what we’ve done in the beauty space, with 50 Black-owned and Black-founded brands now available in our industry-leading assortment. But we’re committed to doing even more in key categories through our owned brands and partnerships, building on our progress to ensure that we’re delivering on our purpose of helping all families discover the joy of everyday life.”

Target’s blockbuster pledge reflects a trend among retailers that believe a real commitment to change is needed as consumers pay more attention and direct their dollars toward businesses that align with their values. Generation Z — those born between 1997 and 2015 — cares more about social justice compared with former generations, according to an annual survey of teens by Minneapolis-based Piper Sandler released in April. Respondents ranked racial equity as their most important political and social issue, followed by the environment and Black Lives Matter.

The $2 billion commitment from Target, which is also based in Minneapolis, where George Floyd died, aims to build on the retailer’s progress to increase its network of diverse suppliers and accelerates its efforts to support even more Black-owned businesses. Target says that it’s establishing new resources, including a team dedicated to providing vendors with support and assisting them in growing and successfully scaling their businesses in mass retail. Building off the success of Target Accelerators, a portfolio of programs supporting entrepreneurs to drive innovation and instigate change, the company is introducing a program called Forward Founders. This program will engage Black entrepreneurs earlier in their startup journey to help them navigate the critical stages of ideation, product development and scaling for mass retail. Offering increased access to subject-matter experts and educational workshops earlier in the startup process, Forward Founders is designed to help Black-owned businesses increase their potential for long-term success in retail.

Through Target Accelerators and events such as the Black-Owned Business Vendor Fair, Target has brought in diverse businesses that have products ready for sale at retail. In some product categories, such as beauty, Target has a strong representation of 50 Black-owned and Black-founded brands, with plans to continue to grow the assortment.

These moves from Target are just one part of the retailer’s innovative approach to advancing social justice and racial equity.

Last year, Target established a Racial Equity Action and Change (REACH) committee composed of senior leaders from across the company who represent a diverse range of perspectives and expertise, and guide the retailer’s efforts to engage in the fight to end systemic racism in the United States and drive lasting impact for the Black community. This investment builds on Target’s previous commitments, including $10 million from the company and the Target Foundation to support nonprofit partners focused on addressing the systemic and structural barriers facing Black communities.

Target is also promising to increase representation of Black employees across the company by 20% over the next three years. The pledge is part of the company’s “2019 Workforce Diversity Report,” which shows that the retailer’s workforce of nearly 350,000 employees skews white, particularly among its top executives. About 75% of its leadership team is white and 8% are Black. Its overall workforce is 50% white workers, 25% Latino and 15% Black.

Target says that it has doubled representation of company non-white officers in the past five years to nearly 30%. Of that, though, only 5% are Black. The company also touts diversity among its store managers: More than half of its stores are run by women, and a third are managed by people of color.

Target’s action plan for improving its diversity metrics includes the following:

  • Leveraging stores, supply chain and HQ experiences to provide broader leadership pathways for Black team members to develop and advance.
  • Developing programs to hire and retain Black team members in career areas with low levels of representation, including technology, data sciences, merchandising and marketing.
  • Increasing Target’s network of mentors and sponsors to help Black team members accelerate and advance their careers.
  • Ensuring Target’s benefits and partnerships drive wellness and safety for Black team members.
  • Conducting anti-racism training for leaders and team members that educate, build inclusion acumen and foster a sense of belonging.
  • Tying leadership compensation to diversity goals.

“The changes we’re making are going to have a meaningful impact on the careers of our Black team members and prospective team members,” says Kiera Fernandez, VP, HR and chief diversity and inclusion officer. “A diverse and inclusive team at Target is one where there’s equity in how we promote, retain and hire team members. Additional leadership development, training programs and mentorship for our Black team members, along with a focus in areas of the business where our Black representation is not as strong, will offer new career development opportunities for our team for years to come. And we know the support we have for our team helps extend our reach outside our walls, creating a ripple effect that impacts our guests and communities.”

Target isn’t alone in its efforts to inject innovation into the business case for increasing diversity and inclusion.

Walmart, Kroger, Albertsons and Harris Teeter have made various pledges to increase spending on racial equity efforts as consumers expect more social responsibility from these brands than ever before.

In February, Walmart and the Walmart Foundation revealed the distribution of $14.3 million to 16 nonprofit organizations in the first round of the retailer’s commitment to contribute $100 million over five years through a Center for Racial Equity to help address racial disparities in the United States. The center’s mission is to complement and extend the societal impact of Walmart business initiatives to further racial equity in the nation’s financial, health, criminal justice and education systems.

Harris Teeter is also accelerating efforts to identify and increase sourcing from suppliers that are at least 51% owned, operated and managed by people who are disadvantaged, disabled, LGBTQ+, military veterans, minorities and/or women and sell grocery, general merchandise, and/or beauty and personal care products.

Kroger says that its Framework for Action: Diversity, Equity & Inclusion (DE&I) plan features both immediate and longer-term steps developed in collaboration with associates and leaders to accelerate and promote greater change in the workplace and in the communities that the organization serves. Kroger’s plan includes the creation of a DE&I Advisory Council, mandating unconscious-bias training, establishing a two-way mentorship and advocacy program between high-potential diverse talent and senior leaders, and increasing spend with diverse suppliers from $3.4 billion to $10 billion by 2030.

While there’s no one diversity and inclusion strategy that can be applied to every company, recent efforts from food retailers show the newly critical importance of translating words into actions.