Boston, Cambridge announce new agreement to expand municipal supplier diversity

Spanning across the Charles River, there are many bridges — physical and metaphorical. Now there’s a new link as the cities of Boston and Cambridge are, together, aiming to increase opportunities for diverse businesses in an agreement between the two municipalities, announced last week.

That official memorandum of understanding, signed by Boston Mayor Michelle Wu and Cambridge City Manager Yi-An Huang at a ceremony Oct. 28, creates new inter-city goals around awareness of public sector contracting opportunities and establishes cross-river supports from the two cities for businesses in each.

“As the engine of innovation for our region, the city of Boston and the city of Cambridge have a responsibility to the lives and livelihoods that depend on the opportunities that we are creating,” Wu said during remarks at the event. “We have a responsibility to share those opportunities and prosperity; they create equity across all of our communities.”

Under the agreement, the city of Boston will be able to certify businesses in Cambridge as minority- and women-owned businesses. Certified businesses in Boston will be able to access training opportunities across the river.

The agreement came out of a realization that contracting interests and opportunities often crossed the Charles River from one city to the other.

“As we looked out across the businesses that we wanted to work with, we realized a lot of them are in Boston — more than in other municipalities — and it didn’t make a lot of sense for us to create our own process,” Huang said at the event. “The whole idea here is to make this easier for the businesses that we want to work with.”

The new agreement marks a step forward in opening opportunities for businesses across the two municipalities, said Nicole Obi, president and CEO of the Black Economic Council of Massachusetts.

Obi called it a “little bit of progress” toward BECMA’s mission of building Black wealth, a goal that is built, in part, on ensuring Black-owned businesses have the opportunity to sell the goods and services they produce.

“Seeing and knowing that the cities of Boston and Cambridge are taking steps to advance the ability for small and diverse businesses to be able to sell their goods and services, I think, is definitely a step in the direction that we want to see around wealth building,” Obi said in an interview.

Cambridge City Manager Yi-An Huang signs the memorandum of understanding. PHOTO: AVERY BLEICHFELD/BAY STATE BANNER

Alongside the signing of the agreement, the city of Boston also announced the launch of a new data dashboard, tracking equity in city contracting.

That transparency and tracking is “a critical part of the effort,” Obi said.

“We feel that to set goals or benchmarks without the tracking, without the reporting, without the transparency, without the accountability really isn’t serious in the work that needs to be done,” she said. “In no other endeavor that businesses undertake, would they set goals without tracking and reporting and holding folks accountable for achievement.”

The event came as the launch of Boston’s second annual Supplier Diversity Week, with a series of workshops for local businesses and the opening of applications for the Supplying Capital and Leveraging Education (SCALE) Grant Program, which supports technical assistance, educational programming and consulting services.

The signing of the cross-river agreement brings together two municipalities at different points in their processes of growing supplier diversity but that have announced similar goals around the issue.

Also on Oct. 28, Boston released its annual equity in city contracts report. In Fiscal Year 2024, which ended June 30, diverse firms received contracts — received more than $100 million for the first time since the city started tracking the metrics. Of the $1.8 billion in contracts since the start of FY24, 12% — about $225 million — went to minority- and women-owned businesses, with a 40% increase in contract award value.

Conversely, according to a report released in December, between 2016 and 2021, just over 1% of the money the city of Cambridge spent on goods and services went to minority- or women-owned businesses.

Over years and decades, Cambridge has made some efforts to close the gaps in its municipal contracting, but Mayor E. Denise Simmons said that “we were just not getting far enough fast enough.” This new partnership will change that, she said.

“The promotion of regional certification and regional contracting opportunities for our businesses is important, and it’s going to be the main statement. I am certain that we will do so much better for our communities when this is launched.”

And Obi said that, despite Cambridge currently trailing, Boston was in about the same place three years ago, when it released its own disparity study in 2021. That report found that Black and Latino firms got 1.2% of the over $2 billion awarded from 2014 through 2019.

The changes Boston has made since then are encouraging, Obi said.

“That wasn’t by accident. It was totally intentional on the parts of many players, and I feel that the City of Cambridge, if they also make the type of effort that the city of Boston did, has the potential,” she said.

Those efforts, she said, have included steps like identifying the barriers that kept Boston from meeting its benchmarks and working with organizations like BECMA, who could serve as trusted voices in the community as the city works to expand in an area where it didn’t have a stunning track record.

Segun Idowu, Boston’s chief of Economic Opportunity and Inclusion, called the changes “progress” and not just “motion,” and said that he thought the advancements will not just allow businesses to win more contracts now, but be better set up for success moving forward.

“We have thrown everything at the wall to try to figure out this issue on supply diversity, and we have really found the things that will work to not just ensure that we’re delivering more contracts, but that we’re building up the Black- and brown- and women-owned and veteran-owned businesses that will one day be able to competitively bid for these contracts,” he said.

Of the cities’ efforts and partnership, Idowu pointed to the saying from French explorer Andre Gide, that “one cannot discover new lands until one has the courage to lose sight of the shore.”

Huang, too, seized onto this idea.

“We have the courage to do that, and a commitment to that journey, to recognize that actually we are now out on the water, but there’s a better shore that we’re aiming for,” Huang said. “I really see that as the outcome that we are looking to change.”