Australian businesses and governments are spending more with certified social enterprises than ever before, reaching a $1.1 billion milestone over the past seven years, according to new data from Social Traders.
Australia’s social enterprise industry body released its FY24 Social Impact Report last week, revealing over 20 organisations each spent more than $1 million in the last financial year (FY).
Social Traders states the cumulative seven-year spend has created 10,000 jobs and over 918,000 training hours for people otherwise shut out of work, contributing to a more inclusive, equitable and sustainable economy.
Elsewhere, $88.1 million has been delivered in affordable and accessible community services, 56,500 tonnes of waste has been diverted from landfill and $13.1 million has been donated to charity partners.
According to the report, the social procurement marketplace has grown every year since FY18.
The last financial year (FY24) saw spend with certified social enterprises hit an all-time high of $257 million, with 62 percent of business members increasing their spend which has helped 80 percent of certified social enterprises increase their trading revenue.
Social Traders CEO Tara Anderson said businesses are not only increasing total spend, they are also working with a wider range of social enterprises across a wider range of procurement categories.
“These results show the power of the social enterprise model and how businesses can use their purchasing power to create real impact for communities and the planet.
“The beauty of social procurement is that it’s simply a business doing what it would anyway – buying goods and services, but using different suppliers.
“By adding social enterprises into a supply chain, a business gets the same quality goods and services but also gets social and environmental value in the same transaction. Switching to social procurement creates a fairer, more equitable and sustainable world.”
Human resource services and recruitment topped the category spend list, followed by healthcare services; building trade, repairs and maintenance; horticulture and arboriculture; cleaning services, equipment and supplies.
Named the ‘Big Spender’ in social procurement for the 2024 financial year, ASX-listed infrastructure services provider Downer spent $12.5 million with certified social enterprises, followed by over 20 organisations who spent more than $1 million, including ANZ, Westpac, Australia Post, Charter Hall, John Holland Group, Lend Lease, Mirvac and Visy Industries.
Fraser Stowers, Group General Manager Procurement and Property at Downer, said the organisation is proud to be recognised as the FY24 Big Spender in procurement spend with certified social enterprises.
“As a large organisation operating across Australia and New Zealand, we understand the significant impact our procurement practices have on our communities,” said Stowers.
“By partnering with Social Traders, we support improved social outcomes through our procurement activities, aligning with our purpose to ‘Enable communities to thrive’.”
Awareness of social enterprise is also growing amongst businesses and consumers, according to the report, with Social Enterprise Finder – a national online directory of certified social enterprises – seeing increased traffic.
The directory was used on average 18,160 times per month in FY24, and has been visited 27,000 times per month on average during the current financial year (up 49 percent year-on-year).
“Despite business uncertainty and anti-DEI sentiment out there at the moment, we’re seeing our business members sticking with their social and sustainability plans,” added Anderson.
“Not for compliance, but for competitive advantage. Most businesses recognise that commitments to doing good and advancing inclusion will earn staff and customer loyalty which supports business growth – especially in turbulent times.
“Our unique position and work with social enterprises, businesses and governments enables us to gather and share exclusive data and insights. We’re thrilled to see such strong results for FY24 and we continue to push toward our vision of $5.5 billion in procurement spend for social enterprises by 2030.”
Social Traders states there are over 12,000 social enterprises in Australia, contributing $21 billion to the economy every year.
