Impact Sourcing is a business practice where a company prioritizes suppliers that intentionally hire and provide career development opportunities to people who otherwise have limited prospects for formal employment.

Who Are Impact Workers?

People hired into an organization who were previously long-term unemployed or living under the national poverty line.

One of the most sustainable means to inclusive economic growth and poverty reduction is to ensure that disadvantaged populations have access to formal employment and decent work, allowing them to improve their conditions, acquire a career, and thus lift themselves, their families, and their communities out of poverty.

What is Impact Sourcing?

Impact Sourcing has been shown to provide many business and social benefits. Service providers access new sources of talent, achieve higher levels of employee engagement and lower attrition rates. Supplier employees take their first step onto a career ladder that leads to economic self-sufficiency through income growth, skills development, and professional advancement.

Read the text-alternative version of this infographic.

Impact sourcing inforgarphic, part 1

Impact sourcing inforgarphic part 3

Impact sourcing inforgarphic, part 4

Credit: The six key elements of the impact sourcing business case in South Africa by the Everest Group.

Infographic Text-Alternative Version

What is Impact Sourcing?

  1. Buyer Company: Prioritizes suppliers committed to inclusive hiring
  2. Supplier Company: Hires and provides career development to people who are below the national poverty line or long-term unemployed
  3. Impact Worker: Receives access to employment and training, creating a positive impact on their income and earning potential
  4. Impact Worker's Family: 5-6 family members benefit due to the increased spend on family and household requirements
  5. Impact Worker's Community: The whole community benefits from the injection of new capital into the local economy

Why Buyers Value Impact Sourcing

  • Supplier Performance: Access suppliers with responsible hiring that compete on quality, service, and price
  • Stable Supplier Workforce: Lower attrition and higher motivation
  • Supplier Inclusion: Meet supplier inclusion and diversity goals
  • Corporate Citizenship: Promote responsible supply chains, social equality, and diverse workforces
  • Social Impact: Create positive impacts for impact workers, their families and communities

Why Suppliers Value Impact Sourcing

  • Workplace Performance: Impact workers’ performance comparable with traditional workers
  • Stable Workforce: Lower attrition and higher motivation
  • Talent: Facilitate access to a large, untapped talent pool
  • Cost Savings: Long-term cost savings compared with traditional workers
  • Competitive Edge: Create competitive advantage for business
  • Social Impact: Create positive impacts for impact workers, families and communities

We have been working on impact souring for several years together with our suppliers to encourage inclusive employment at Microsoft. Impact sourcing is about knocking down artificial barriers to employment and allowing high-potential individuals to bring their strength to the marketplace.

Tim Hopper, Manager of Responsible Sourcing Initiatives, Microsoft