Spending on social enterprises hits record levels: report

Posted on 25 Mar 2025

By Greg Thom, journalist, Institute of Community Directors Australia

A new report has outlined the positive societal benefits of the rising amounts of cash being spent on social procurement in Australia.

The Social Traders Impact Report revealed that governments and businesses spent more than $1.1 billion with social enterprises over the past seven years helping to create a more equitable and sustainable economy.

The report by industry body Social Traders found cumulatively this investment had:

created 10,000 jobs and more than 918,000 training hours for people otherwise shut out of work

delivered $88.1 million in affordable and accessible community services

diverted 56,500 tonnes of waste from landfill

resulted in $13.1 million being donated to charities

The report showed spending with social enterprises hit an all-time high of $257 million in FY24.

Social Traders CEO Tara Anderson said this helped 80 per cent of social enterprises to increase their trading revenue compared to the previous year.

“Businesses are not only increasing total spend, but they are also working with a wider range of social enterprises across a wider range of procurement categories,” she said.

“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.”

Anderson said social procurement occurred when business and government chose to buy from social enterprises, using their purchasing power to generate social value beyond the value of goods and services.

Australia’s 12,000 social enterprises contribute an estimated $21 billion to the economy every year.

"Switching to social procurement creates a fairer, more equitable and sustainable world.”

Social Traders CEO Tara Anderson.

Human resource services and recruitment
Healthcare services
Building trade, repairs and maintenance
Horticulture and arboriculture
Cleaning services, equipment and supplies
Waste management and landfill
Engineering, research and tech services
Training and education services
Business and administrative services
Parking, traffic services and traffic equipment

The report named infrastructure services provider Downer as the biggest spender on social procurement in the country, investing more than $12.5 million with social enterprises last financial year.

The company topped a list of 20 organisations that spent more than $1 million each with social enterprises, including ANZ, Australia Post, Lend Lease and John Holland Group.

“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,” Ms Anderson said.

“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.”

Anderson said the report revealed that the social enterprise approach was gaining broader recognition by businesses and consumers.

The report found that use of the Social Enterprise Finder, a national online directory of certified social enterprises, increased by 49 per cent in the year to February 2025.

“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,” said Anderson.

She said this was not for compliance reasons, 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.”