Sunday, March 13, 2005

Are Asian-Owned Businesses Minority Owned?

It's funny when U.S. political correctness runs amok in other areas of the world. In my case I have a contract clause clearly meant for a U.S. supply agreement that got left in for an Asian supply agreement. Here's the situation:

My company has factories in Asia, and only in Asia: Taiwan, China, Korea (the good part), Philippines, etc.

We occasionally subcontract work when the factory gets overloaded or for certain processes we don't specialize in. These subcontractors are always close to the factory for logistics reasons, so the Taiwan plant subs to Taiwanese subcontractors, the Filipino factory subs to Filipino contractors, and so on. Sometimes these subs may be parts of large multinational conglomerates, but they are always local factories run by locals (usually they are locally owned small businesses since the entrepreneurs in these countries go out and start companies to do the specialty work the multi-nationals don't want to do themselves).

So imagine my surprise when one of my customers sent me a supply agreement that has the following:
Minority/Women/Small Disadvantaged Business Enterprises -Supplier agrees to provide (Customer) with information about Supplier's activity in support of minority business enterprise, women business enterprise or small/disadvantaged business as part of this Agreement. Supplier and (Customer) will jointly establish annual spending goals with these types of suppliers.
I told my legal people to tell my customer's legal people to shove this clause. I'm not going to deal with this crap, and it is totally uncalled for in products that are 100% sourced and assembled in Asia. All our subs are Asian, but we all know that the Taiwanese, Chinese, and Koreans aren't considered "minorities" to the PC people who originally wrote this clause.

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