2014-2015 Corporate Social Responsibility Report

Supplier diversity & procurement practices

To facilitate a diverse supplier base that reflects the diversity of our associates, our customers and the communities we serve, we identify procurement opportunities and maximize participation of approved suppliers, including minority-owned enterprises; woman-owned enterprises; small-business enterprises; lesbian, gay, bisexual, transgender enterprises; and businesses owned by disabled people. Almost 13 percent of Humana’s total supplier spend is with minority-owned, women-owned and small-business suppliers.

Through periodic events hosted by Humana or annual engagements with supplier-diversity advocacy organizations, we continue to strengthen relationships with diverse suppliers and identify new suppliers that are interested in partnering with us for the provision of products, services and collaborative opportunities.

In addition to Humana’s commitment to supply chain inclusion, we have healthcare services contracts with commercial and government customers that require the utilization of certified minority business enterprises and woman-owned business enterprises, for the procurement of products and services in direct and indirect support of the contracts being administered to the customer. Customers require spend commitments with suppliers holding specific certifications, in specific locations, and/or of specific ethnicities. Our affiliation with and participation in these annual outreach events are critically important to affording us access to diverse suppliers who help Humana support the needs of our customers.

We seek a diverse supplier base for a variety of reasons, including the following:

  • Doing so drives compliance, supports inclusion and encourages competition – all while supporting Humana’s CSR efforts.
  • We believe that our suppliers are extensions of ourselves and, therefore, should reflect the diversity of our associates, members and the communities we serve.
  • Many of our commercial and government customers require us to use certified minority business enterprises and woman-owned business enterprises to procure products and services in direct and indirect support of contracts with them.

We have been able to maintain a 13 percent average utilization rate of diverse suppliers over the past two years – despite the significant changes in our business environment. We have continued to strengthen relationships with diverse suppliers and identify new suppliers that were interested in working with us. Every year, we host events and work with supplier diversity organizations to help us meet new suppliers who have characteristics that might not be sufficiently represented in our supply chain.

The primary supplier diversity organizations we work with include:

  • Women’s Business Enterprise National Council
  • United States Business Leadership Network
  • National Minority Supplier Development Council
  • National Gay & Lesbian Chamber of Commerce

Collaborating with these organizations helps us fulfill our commitment to supply chain diversity and inclusion. As part of our engagement with the National Gay & Lesbian Chamber of Commerce, Humana sponsored “Walk & Talks” at the 2015 International Business & Leadership Conference. The “Walk & Talks” provided opportunities to identify business opportunities during scheduled walking sessions with qualified LGBT suppliers, all while encouraging health and well-being in the supply chain.

We’re proud that we’ve been recognized for our ongoing commitment to driving diversity and inclusion within the supply chain. Awards we’ve won for internal engagement and supplier diversity management.

We challenge ourselves to continue diversifying our supply chain and to meet ongoing contractual requirements related to procurement. Such requirements can include anything from requiring the supplier to have a specific certification to requiring us to use suppliers in specific locations or of specific ethnicities. These requirements often help define our procurement practices and supply chain profile.

The chart below shows the percentage of our spend with suppliers in states that represent 70 percent of Humana’s associate base as it compares to Humana’s total supplier spend:

Supplier Diversity States Chart

Note: All numbers have been rounded.