Social procurement can be used in a variety of ways to create societal benefits, such as supporting employment of those traditionally disadvantaged in the labour market, or providing opportunities for entrepreneurship within marginalised groups. It therefore is encouraging to see that the implementation of social procurement policies is on the rise. But, as with most things, there is always space for more good work to be done.
This was highlighted at SAP’s recent Spend Connect Forum, which took place in Sydney on November 29 2022, where the audience heard from two of SAP’s valued partners in the social procurement space about how impactful and important social procurement is, why organisations need to champion it, and how to go about doing so.
SAP has been partnering with Social Traders for the past two years. Social Traders match corporate and government buyers with suppliers that are qualified as social enterprises.
Our partnership with Social Traders is designed to accelerate the sector’s impact by creating corporate spend opportunities through SAP’s Ariba network and to support the capability and capacity of social entrepreneurs to scale and deliver to these new markets through mentorship with SAP.
We have also been working closely with Supply Nation in this space. Supply Nation is a non-profit organisation that supports the growth of Australia’s indigenous businesses through the promotion of supplier diversity.
Tara Anderson, CEO of Social Traders, and Sandra Waga, Head of Membership at Supply Nation, shared their expertise in the social enterprise space, and how the delegates could drive a social procurement strategy within their own organisations.
Because social procurement is still an emerging market segment, it is perhaps not as widely known as it should be just how far reaching it is becoming. There is a perception that social procurement still only largely applies to small ticket items, but the reality is very different. Opportunities for social procurement now extend across the enterprise.
For a social procurement strategy to stand the best chance of success, there needs to be executive buy-in, clear goals and KPIs, and a champion within the organisation to drive it on.
In addition to this, there needs to be at least one determined individual within the enterprise that drives it along and help ensure that the agreed strategy is applied to procurement wherever and whenever possible.
Organisations now have an opportunity to redirect budgeted procurement to businesses that are traditionally under-represented in this process, and it’s by no means a narrow scope. Supply Nation represents over 900 different business types in the indigenous business sector alone.
For the businesses involved in the procurement, the main benefit to them is that they are doing the right thing by their customers and society by minimising their environmental footprint and supporting businesses that are in turn supporting their own communities. This all comes at no additional cost to themselves.
Supply Nation’s statistics show that indigenous businesses are 100 times more likely to employ an indigenous person than a regular business, so from the indigenous community’s perspective, it is clear what that type of procurement support means for them, whilst for the business engaged in that social procurement, the positive impact it has on that business as a place to work, and to conduct business with, is huge. This equally applies to other groups supported in the social enterprise space.
In closing, Tara from Social Traders really got down to brass tacks and shared with the audience at SAP’s Spend Connect Forum why procurement managers everywhere should be looking to drive social procurement within their enterprise.
“At the end of the day, when you get home from work and your children ask “what did you do at work today?”, do you want to say “I made some purchase decisions and saved a few dollars for my company”, or do you want to say “I did that whilst helping keep a ton of plastic out of the ocean, or supporting employment and education programs in the First Nations community, or helping women affected by domestic violence get back up on their feet again by supporting their business, or one of a myriad of other initiatives for the betterment of society and the planet? It’s a no-brainer really.”
To explore additional resources to learn how you can drive success in social procurement in 2023 and beyond – you can now view the replays and see the highlights from Spend Connect Forum 2022 here.