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Social enterprise Certification driving improved social outcomes

February 14, 2020

Last updated on March 4, 2020

Private sector and Government buyers have spent more than $105 million with Social Traders (ST) Certified social enterprises since the Certification service was launched 18 months ago.

The $105 million has enabled ST Certified social enterprises to deliver 700 new jobs and more than 220,000 hours of skills training for disadvantaged Australians as well as $8 million in low cost goods and services and $2 million in charitable contributions.

Social Traders launched Certification in April 2018, as a means of providing social enterprises with brand credibility and enhancing their prospects of winning procurement contracts.  The service is also designed to provide buyers with assurance that social enterprise suppliers are legitimate.

Social Traders Buyer Members have increased from 30 to 73 (up 143%) in the same time period, providing the strongest indication yet that Certification has successfully heightened confidence in the social enterprise sector.

Social Traders Managing Director David Brookes said the spend result is promising for Social Traders and demonstrates that awareness of the power of social procurement is increasing.

“We set out to achieve this spend target by 2021 so to achieve it in half the time is very pleasing for us and very promising for the social enterprise sector,” Brookes said.

“Part of our challenge has been to help buyers appreciate the legitimacy of commercial deals with social enterprise and remove the mindset of social procurement as a charity or goodwill initiative. This is where Certification has been really important. Our buyer members have told us they value Social Traders’ Certification as an important integrity measure to the sector, and this is reflected in the increase in buyer members. For social enterprises, increased awareness and growing depth and diversity in the sector is encouraging – but it does mean they need to give themselves the best chance of winning work. This is where the value of Certification lies.”

Australian property group, Mirvac, has been a Social Traders buyer Member since 2016. Mirvac Resource Recover Manager, Kim Host, said the Certification was valuable in providing a central register of potential suppliers

“From our perspective it has proven to be an important tool in allocating our social enterprise spend,” Ms Host said.

“It provides us with the assurance that the suppliers we choose are legitimate businesses with a clearly defined social purpose. It makes the diligence process significantly less resource intensive than it may otherwise be.”

Lois Dillon, from Mates on the Move – a transport and logistics social enterprise that provides employment pathways for people exiting the corrections system – said that Certification had made a fundamental difference to the growth of the business.

“Access to the Social Traders network has been priceless for us, and been the key plank of our growth,” Ms Dillon said.

“An introduction to our first major social procurement contract through Social Traders has led to several more. Carrying independent validation makes a major difference in the way new clients assess us, there is no doubt.”

Brookes added that the challenge for Social Traders is to continue to build on recent momentum.

“Our focus is on opening up further procurement opportunities for more of our certified enterprises from our growing community of buyer members. Additionally, growing our buyer membership base is critical if we are to drive long term sustainable impact.”

Social Traders marketplace currently has 73 business and Government members and 321 Certified social enterprises from around Australia.

BACKGROUND

Social Traders Certification is designed to offer an increased level of flexibility and rigour that preserves the integrity of a social enterprise’s mission.

“While social enterprises are primarily driven by a social purpose, they also operate under many different models,” Brookes said.

“It’s therefore critical to make Social Traders Certification available to all business forms that are truly operating as social enterprises, given the market advantages Certification is designed to deliver.

Social Traders uses the following definition of a social enterprise:

  1. Has a defined primary social purpose, environmental or other public benefit
  2. Derives a substantial portion of income from trade
  3. Reinvests 50% or more of any annual profits towards achieving the social purpose

*Finding Australia’s Social Enterprise Sector, 2010, 2016

ENDS

For further information, interviews, case studies or images contact:

James Aanensen – M: 0410 518 590
E: jaanensen@prx.com.au

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