Diversity in Natural Foods: The Way Forward

Readers of my last two columns get the point: food and beverage companies in the natural products industry should strive for racial and ethnic diversity, from line employees to chief executives. It’s both a moral imperative and a benefit to the industry.

We’ve already established that the industry’s promise of environmental and social consciousness and healthier products should expand to create economic empowerment for underserved minority communities. The ideals that helped spur the natural foods movement dovetailed with a political awakening that was also focused on civil rights; despite those similar origins and a progressive focus that essentially comprises the marketing edge for many companies in the natural product arena, those ideals have not coalesced. But there’s tremendous opportunity for this progressive set of companies to advance a moral and economic agenda with regard to diversity. At this point, it can be a branding advantage and opportunity to resonate better with consumers, or, if it fails to do so, there may be a backlash that drives consumers away from those products.

Nevertheless, I also want to make it clear that I’m aware it can’t all be done at once, as eager as I am for substantive change in this regard. Companies need to be able to hire the right people, regardless of race or ethnicity, and the right products need backing, regardless of who is making them. But this case deserves attention.

To that end, now we’re going to think about solutions: practices that the industry and its component companies can inaugurate to spur both employee and entrepreneurial diversity.

In the human resources field, there are well-established protocols that older industries and larger companies adopt to create diversity and ensure talent development. Those have met with varying degrees of success, but the impetus has been clear – with a diverse workforce comes a broader set of opportunities fueled by multiple perspectives. That has applied to women, minorities, nontraditional hires, and multinational employees. The one thing that binds these “people strategies” together is the desire to engage this kind of diversity. There’s no single playbook, but there is always intent. The takeaway, for a younger industry with many smaller companies, should be to extend your job search, play fair, and incorporate diversity as a goal when hiring at all levels of your organization. The current makeup of the industry demands that this goal at least be a factor in candidate searches; right now, it isn’t.

Also look beyond hiring to the larger ecosystem. One position my research continues to point out is the Supplier Diversity Manager, an ombudsman-like role that makes consideration of a variety of sources systemic. We know that many of the brands in this growing industry wrestle with more immediate supply chain issues – but that doesn’t mean, as with hiring, that the intent can’t be altered – that quality suppliers exist beyond our immediate circles, if we make it a point to look for them. When it comes to picking vendors and new employees, the advantages of diversity should be given strong consideration and viewed as a positive.

The suggestion is that we can all start earlier, reach further, try harder, at all stages.

So what are some more immediate strategies? For even brand-new companies that want to make a long-term difference, the pipeline can begin immediately, with an internship program. One thing that Honest Tea’s Seth Goldman has done is to reach into his community for a series of interns who can work for the company, even while in high school. Drawn from several organizations – the Urban Alliance and the Takoma Park, MD-based Catholic school Don Bosco Cristo Rey High School are two – the company offers real opportunities to work, network, and build mentor relationships for teenagers of diverse backgrounds. Honest Tea benefits as well – the interns mail plenty of sample products, Goldman explained – but they get paid while also getting valuable looks inside the industry. Furthermore, by bringing in interns from nearby schools, the company extends goodwill further into its own community while creating opportunities for success.

College recruitment is another development avenue. As one HR professional told me, larger companies, the Netles and the General Mills of the world, pointedly recruit for diversity on campus; smaller companies don’t always manage to bring that intent to their efforts.

“It’s easy, because you’re always recruiting, every summer, every semester,” I was told. In smaller organizations, today’s street teamer is tomorrow’s marketing director.

But the pipeline cannot only be built at the bottom of an organization. Inclusion has to happen at the board level as well. This has a double impact, particularly at young companies, when founders rely heavily on the board for connections to key employees who will set the tone for companies for years to come. In terms of talent recruitment, bringing ethnically diverse board members on board should be seen as a competitive advantage, creating the opportunity to reach new networks of potential employees.

I’m going to reach back into the previous sentence for “networks” again, because that word came up repeatedly in my reporting. In an industry in which the people you know are often the best link to investors and jobs, there has been almost no attempt to create a networking component around racial and ethnic diversity. The big Expos and other selling shows tend to have at least one event centered around women and their achievements in the industry, which provides a great space for learning, discussion and most importantly networking. There have not, however, been any kind of organized meetups for minorities in the business, and the connections made at those events are of the utmost importance for creating both opportunity for attendees and feedback for the industry.

“It’s a learning tool to move things to the next level,” Lindsay Greene, the Chia Company’s director of sales operations, told me. “A happy hour is where there’s a start, and broader groups are where there’s a stepping stone. Let’s get everyone in a room who cares and start to have a conversation that way. That’s the best way to figure out what next steps would make sense.”

Those kinds of events are also where interested employees meet to define the ladders of opportunity that exist within organizations, and new ideas flourish.

The older, deeper companies in the industry should also set an example: established natural food and beverage companies like White Wave, Hain, and Boulder Brands; retailers and distributors like Whole Foods, UNFI, KeHE, Trader Joe’s and Sprouts; even the large traditional strategics that are playing in the space, like General Mills, Coke, Pepsi, and Snyders/Lance need to demonstrate that they are committed to incubating talent and for creating networks that will allow minority employees advancement opportunities. I know it won’t happen overnight. Even compared to the third set of strategics, the first two sets of companies are new and young and still finding their place within the establishment; many still have their founders in leadership roles; some still face uncertain futures. But that only means there is greater opportunity to more quickly broaden the long-term set of priorities that the industry represents. Look at Starbucks’ leadership role: despite stumbles with its “Race Together” initiative, the company is following through, building in minority neighborhoods and creating a coalition that will find ways to hire 100,000 unemployed 16 to 24-year-old “opportunity youth” in the years to come. Creating a development path for a skilled, diverse executive class will also help to inject diversity on the entrepreneurial side. A significant fraction of startup founders are big company “refugees.”

But I’d like those big companies to go further: their incubation shops can take a second look at those entrepreneurial businesses that are being run by representatives of underserved communities and think about the overall impact that funding might have. True, entrepreneurship is a tough road, but at the same time, it creates wealth and opportunity: the ability to fund the risk inherent in entrepreneurial enterprises is one of the biggest differences between communities of privilege and the traditionally underserved black and Hispanic communities. Until that changes, the ability to extend entrepreneurial enterprises beyond the limits of underserved areas will remain a hard one. As one executive told me, there’s an equal amount of quality ideas in every community – but network access is the dividing line. We need to step over that line.

I’ve looked askance at Whole Foods a couple of times during these columns, not because they’re villains, but because in many ways they are the most visible symbol of the natural food and beverage industry in the larger world. It’s in the name of fairness that I point to the Local Producer Loan Program as one of the ways that the company is bridging the dividing line. I’d also like to point to their Whole Cities program as a way to bring about change within food deserts, and to their building in Detroit, on 125th Street in Harlem, and in the Englewood neighborhood in Chicago. Still, more retailers need to cross over. I’d also like to see more willingness from buyers and distributors across the spectrum to nurture, in a commercial way, those entrepreneurs from black and Hispanic communities who may not come in with the same knowledge that comes from operating within an established network. Take the time to educate on how products and execution can be improved, don’t just pass them over. There are gems out there.

Now we’re in the home stretch, although I hope we aren’t about to conclude the discussion. Just as I encourage you to extend your conception of what a successful business can be to include this societal issue as part of the discussion, so too would I encourage you to extend my thinking as well, so that I can better understand your own methods and motivations. To that end I will be offering space in future columns to more ideas.

Change is hard, especially when you’re growing fast in one direction. But as revenues grow the industry broadens. Natural and organic products now get more of their revenue from conventional retailers than they do from specialty and natural stores: that’s a signal that the values that the industry promotes are capable of changing long-entrenched consumer behaviors. It’s my hope that it’s also capable of changing long-entrenched societal behaviors as well. I believe that the social edge carried by so many brands, retailers and investors into this arena is indicative of how powerful the high ground can be as a point of difference. But it’s one thing to plant a flag in that ground; as we have seen recently, it’s more important than ever that it be a flag that waves for everyone.