Certification in Supplier Diversity Practice Exam

Which type of capital includes the collective knowledge and competencies of an organization's employees?

1. Relational capital

2. Human capital

3. Organizational capital

4. Intellectual capital

The correct answer is: Human capital

Human capital encompasses the collective knowledge, skills, competencies, and abilities of an organization's employees. This concept emphasizes the value that the workforce brings to an organization through their expertise and potential to drive performance and innovation. By investing in the training and development of employees, organizations can enhance their human capital, leading to improved productivity and competitiveness. In the context of supplier diversity, recognizing and leveraging the human capital within an organization can be pivotal. Diverse teams often incorporate a wide range of perspectives and experiences, fostering creativity and better decision-making. This diversity of thought is essential in developing inclusive supplier chains and enhancing organizational practices. While other types of capital, such as relational or intellectual capital, focus on different aspects of organizational value—like relationships and the knowledge built over time—they do not specifically concentrate on employees' individual skills and capabilities, which are central to human capital.