- What to Look for and How to Ethically Source a Remote Team
- The Rise of Ethical Consumerism
- What Is Ethical Sourcing?
- How Does Ethical Sourcing Apply to IT?
- Tips for How to Ethically Source IT Services
- Myth Busting – Is Outsourcing Unethical?
- Business Benefits of ethical sourcing
What to Look for and How to Ethically Source a Remote Team
Just last year many of the U.S.’s most influential business leaders signed a public statement, declaring that business is no longer just about profits.
According to the statement, businesses are innately responsible for the well-being of their employees, their suppliers, the communities where they operate, and the environment.
Of course, these moguls aren’t naturally big-hearted innovators shaking things up for the greater good.
They’re simply evolving with, and responding to, a cultural shift in consumer values.
In this post, we’ll look at ethical sourcing in the IT industry. You’ll see what to look for when you decide to source ethically, how to make sure your IT service providers are ethical, and we’ll bust a couple of myths.
The Rise of Ethical Consumerism
When you envision a better world. What pops into mind?
Whether it’s equal opportunities, clean rivers, or health benefits – The consumer now understands that every buck you spend is like casting a ballot.
You’re voting for the kind of world you want to live in when you support a business. Because when you support a business you support the way they do business.
If you want to guarantee workers safe working conditions, for example – The answer has become relatively simple, you buy from businesses that share your values and maintain safe working conditions.
What Is Ethical Sourcing?
Ethical sourcing is the process that businesses use to ensure that their products and services come from responsible sources.
If you plug ‘ethical sourcing’ into a search engine, the majority of your search results will be about manufacturing and agriculture supply chains.
Let’s say, for example, a business sells clothes: Where does the material come from? Does it contain harmful chemicals or dyes? In agriculture, do the farmers practice sustainable farming methods? Are the farmhands and factory workers compensated fairly?
A retailer that practices ethical sourcing would refuse to buy and sell products from suppliers that exploit workers or act carelessly in regards to the environment.
How Does Ethical Sourcing Apply to IT?
Websites and mobile apps aren’t sourced on farms and in factories. So, what exactly does ethical sourcing look like in the IT industry?
The following are ethical standards that you can hold your IT service providers to.
Investing in Employees
This starts with compensating employees fairly and providing employee benefits. And extends to providing a comfortable and safe work environment.
These are the legal standards the world over, unfortunately, it isn’t uncommon to find companies that cut legal corners to drive their costs down and make their prices more attractive. Unfortunately, those that suffer are their employees and the communities they belong to.
An IT service provider that’s invested in its team will also promote and/or sponsor further training and education. This helps employees develop new skills, and stay competitive in a rapidly changing world.
When searching for a remote team, hold out for the company that doesn’t treat their specialists as disposable, letting them go once a project is completed.
Investing in Community
Investing in the community includes being proactive about inclusivity and representation in the workplace.
This concept can extend outside of the office and can include donating funds, goods, or volunteer services to a social or environmental cause.
Committing to Environmental Sustainability
Environmental sustainability overlaps with investing in the community because protecting our natural surroundings is good for our community’s health and wellbeing.
During your vetting process, don’t shy away from asking service providers what steps they take to reduce their carbon footprint. This attention to detail might tell you a lot about the company in question.
Smaller, but important, steps could include working from home, creating recycling programs, opting for sustainable office supplies, and going paperless.
Greater efforts could include purchasing carbon offsets, organizing sustainability workshops, and getting ‘Green Business’ or ‘B Corporation’ certified.
Committing to Clients
A large part of being an ethical business is providing the best product or service possible.
In providing remote IT services, this is achieved through transparency.
Sharing information with the client about taxes, costs, talent, critical issues, and the development cycle can be uncomfortable. But it is necessary to get the best result possible.
“With accessible information and open communication, you can hold your remote team accountable and can be more involved in the decision-making process. Studies demonstrate that a transparent development life cycle is more likely to meet functional requirements.
In other words, transparency builds collaboration, collective decision making, and strong business partnerships.”
Tips for How to Ethically Source IT Services
Now that we’ve talked about the characteristics of a sustainable and ethical IT service provider, let’s talk about how to find one.
Use a Vetting Process
Implement a thorough vetting process based on research and interviews. Vet for transparency, utilize industry best practices and create questions regarding the ethical sourcing standards listed above: employees, community, environment, and transparency.
Read more here about how to vet for a transparent development team.
Ask for Ethical Practices
Make your standards known. Interested in working with a company they’re not quite up to your ethical standards? Tell them your standards outright.
The company might be willing to make changes to form a strategic partnership with your business.
When you’re narrowing in on the perfect IT service provider and you’re about to trust them with a big project, visit them. Tour the facilities, explore your security concerns, talk to the employees, and check their claims.
Follow recommendations from the Chartered Institute of Procurement and Supply (CIPS) or a similar organization dedicated to ethical procurement standards.
As the buyer, do more than the formal, scheduled site visits. Inform your IT service provider ahead of time that you reserve the right to audit their business unannounced, physically or remotely.
Myth Busting – Is Outsourcing Unethical?
The words outsourcing and staff augmentation have been stigmatized because of job loss in U.S. manufacturing. And also because of famous human rights violations like Nike’s sweatshops and child labor in Indonesia in the 90s.
Unfortunately, this stigma has unfairly carried over into IT.
Despite its infamous reputation, outsourcing is not automatically unethical.
Myth 1 – You’re Putting a U.S.-Based Specialist Out of Work
In 2019, U.S. federal employment data taken over 3 months indicated 918,000 vacant IT jobs.
94% of tech companies report using some kind of staff augmentation or outsourcing not only to reduce costs and to increase productivity; but also because they need to fill tech talent gaps.
Due to the talent shortage, large companies use attractive sign-on bonuses and generous benefits packages to recruit. Small to midsize enterprises with a tighter budget are finding it harder and harder to compete in the limited talent pool, making it harder to keep up and grow.
Myth 2 – Paying Lower Wages is Unethical
The majority of IT work is sourced from abroad, often in developing countries where costs are lower. The myth is based on the thought that it’s unethical to pay lower costs abroad.
The reality is that wages are relative to the country and the cost of living there. For example, the cost of living in Costa Rica is lower than the cost of living in the United States. Therefore, it’s entirely possible to pay a Costa Rican development team fairly while still reducing your costs.
As long as you do business with a development team that operates legally in their country, pays fair wages relative to their economy, and provides employee benefits – You do not need to worry about the wage myth.
To learn more about how the ‘outsourcing is unethical’ myth came to be, read here.
Business Benefits of ethical sourcing
Businesses should follow ethical standards because it’s the right thing to do.
But it also turns out ethical and sustainable practices are good for the bottom line.
A recent study between the University of Chicago and Washington University Saint Louis demonstrated that a company doing good received 25% more applications. Once on the job, the workers were also more productive.
In the 1970s an infamous New York Times article stated that “the business of business is business”. The opinion that the only responsibility any business has is to make a profit, seems ridiculous and selfish today.
Of course, a sustainable business has to make a profit. But full organizational sustainability is only accomplished by nurturing people and the planet.
Small to midsize businesses and tech companies can find ethical development services with Nativo. For responsibly sourced websites, web apps, mobile apps, and QA visit Nativo and download our rates.