Top social procurement trends businesses can't afford to ignore
Social procurement is when organisations use their buying power to generate social value above and beyond the value of the goods, services or construction being procured.
It’s a lever to meet sustainability and ESG goals by incorporating diverse suppliers into their procurement strategies.
The social procurement marketplace has grown every year since FY18. More than $1.4 billion has been spent with certified social enterprise, and it's on the rise.
Here are the trends we're seeing.
Help Enterprises
Social procurement, a strategic business lever creating social value
More organisations are realising the power of using their spend to create social value. They’re activating their supply chains by partnering with certified social enterprises to connect social value with business value.
Social enterprises employ people who face the greatest barriers to work: refugees, people living with disability, those recovering from long-term unemployment. They supply goods and services that meet community needs in underserved markets, and they offer environmental solutions.
By the numbers, FY25 at a glance
$1.4 billion
cumulative spend since FY18, with 35% average annual growth
$304 million
spent with certified social enterprises, a record single-year total - up 18% on FY24
151
business and government members spending with certified social enterprises
$47.1 million
spend directed to marginalised women, 56% growth rate year-on-year
$18.8 million
spend supporting Aboriginal and Torres Strait Islander communities, 69% growth rate year-on-year
71%
business and government members increased their spend year-on-year
Businesses are activating social procurement in a wider range of spend categories
The categories historically associated with social procurement were catering and cleaning. The growth we're now seeing is in engineering, technology, architecture, planning, community services, and building trades. The figures below compare spend in FY20 with FY25:
- Building trades, repairs & maintenance: $1.8m → $62m
- Engineering & tech services: $155,000 → $11.6m
- Architecture, planning & design: $80,000 → $2.1m
- Community & social services: $22,000 → $1.6m
Travellers Aid
Be Well Co
More industries are getting on board
Property and infrastructure built the foundations of social procurement in Australia. These sectors remain the largest contributors by spend.
But the membership growth story in FY25 sits elsewhere: the banking, consulting, energy, education, FMCG and transport sectors have all grown.
The energy sector is a useful illustration. New energy sector members have joined Social Traders every year for the past four years. This is not coincidence; it is a pattern of organisations watching peers move and deciding they do not want to be last.
Compliance opened the door. ESG is now driving the agenda
Five years ago, most organisations that joined Social Traders were responding to policy. Tender weightings, mandatory government procurement frameworks and the Victorian Social Procurement Framework were the main catalyst. In 2020, 54% of new Social Traders members cited compliance as their primary reason for joining. By 2025, that number has dropped to 45%.
ESG and sustainability goals now account for 38% of new member motivations. Between the two motivations, the gap has narrowed from 16% to just 7% in five years. Organisations are driving social performance through their supply chain as a strategy to manage and report on their ESG goals.
Miei
Social spend impact
Through the total cumulative spend over the last eight years, our business for good community has supported:
13,383
Employment outcomes
1,000,000
Training hours
$103 million
Affordable and accessible community goods/services delivered
$16.8 million
Funds donated to charity partners
68,050
Tonnes of waste diverted from landfill
Social performance leaders
These are the members generating social value through their supply chain, by spending with certified social enterprises.
Organisations spending $5 million+
Organisations spending $1 million - $5 million
Guide to Social and Indigenous Procurement
We have collaborated with the Property Council of Australia and Supply Nation to create this guide.
It's a resource to effectively implement social procurement within your organisation. The first step, set clear objectives and building awareness among key stakeholders.
Define the benefits for your business and society, ensure alignment with your values and strategy, and secure a senior sponsor to drive engagement, all while leveraging existing resources and forming strategic partnerships.
Looking to start or enhance your social procurement journey?
Get in touch to find out how we can help.