Sustainability, CSR, and DEI: New Criteria for Choosing Nearshore Partners

Amid the growing focus on addressing climate change and boosting social morale, many North American businesses have begun turning to nearshore outsourcing as an alternative. As Amalga Group Founder and CEO Jens Erik Gould explains, nearshoring can help companies uphold eco-conscious production practices and ethical business models while boosting Diversity, Equity, and Inclusion (DEI) across the board.

Whereas offshoring often leads to an increase in a company's carbon footprint and muddled communication amongst teams, nearshoring can do the opposite. Below, Jens Erik Gould touches on how switching to a nearshore provider can solve many of a business' most pressing problems.

Supply Chain Issues and Transportation Costs

One of the biggest issues American manufacturing companies face is supply chain delays. Not coincidentally, these interruptions are often significant contributors to a company's carbon emissions. Luckily, nearshoring can greatly offset supply chain issues.

"When our manufacturers are closer to home, we're effectively able to reduce potential delays caused by customs at the border. Oversight of our suppliers also increases dramatically," says Jens Erik Gould. "All in all, we're looking at smoother operations and improved communication throughout the supply chain process thanks to nearshoring."

With less distance to travel, nearshoring can also significantly decrease both transportation and the costs and environmental impact associated with transportation. This is especially critical when you consider the impact transportation emissions have on the climate.

Fair Labor Practices and Community Engagement

Corporations today are more concerned than ever with treating their workers fairly. And they should be—because workers form the foundation of companies. As Jens Erik Gould explains, the priority must remain on ensuring that nearshore companies and their workers are treated appropriately and that fair labor practices are instilled.

"There's an important focus on corporate social responsibility (CSR) in agreements between nearshore companies and their associated companies in the United States," says Jens Erik Gould. "By way of supplier audits and certifications, worker empowerment programs, and supplier agreements, we're seeing an increased focus on upholding fair labor practices in nearshoring countries."

Nearshoring also serves as a potentially massive boon to community engagement. In recent years, it's led to immense job creation and skill development for workers in Latin American countries.

"Nearshore companies often provide extensive training to their employees. In a way, we're seeing communities being uplifted because of the uptick in work," says Jens Erik Gould. "As a bonus, we're also seeing more workers today develop skills earlier on through education—all because they want to work at nearshore companies."

Diversity, Equity, and Inclusion (DEI) in Nearshoring

With a switch to nearshoring comes the need to uphold proper Diversity, Equity, and Inclusion practices. According to Jens Erik Gould, there are three pillars for establishing an educated, welcoming corporate culture among a nearshore team.

First, onshore companies must openly celebrate diversity amongst their nearshore teams by incorporating cultural traditions and celebrations into the flow of activities. Second, these companies must acknowledge the barriers that nearshore team members may have faced in the past and work to always be proactive in limiting these barriers. Third, onshore companies must seek to understand cultural differences and find a way to bridge any gaps in communication between teams. After all, bringing teams together will lead to a stronger overall mindset.

"By focusing on these three pillars, you can all but ensure that everyone on your team feels engaged, respected, and heard," says Jens Erik Gould.

If you're looking for a way to reduce carbon emissions, uphold fair labor practices, and bridge the cultural gap, nearshoring might be your best option.