Social procurement - 4 steps to get started

Social procurement enables organisations to use their normal budget to create social inclusion and impact, while otherwise continuing business as normal.

Social procurement involves using your purchase power and applying it in a smarter way to generate social benefit, particularly employment. Social procurement is sometimes called impact spending.

Your workplace's standard procurement practices have potential to impact positively on people and communities.

Social procurement should not impact on quality of services and does not involve compromise. The service provider must provide value for money and quality services. Procurement must continue to be made through a competitive process. However, procurement practices can make minor adjustments to ensure greater inclusion, diversity and social benefit.

Here are four ideas to get started:

1. Start small

Try making socially impactful decisions for low value, low risk corporate purchases. If your organisation often has catered functions, invite local social enterprises, Indigenous owned caterers, and disability inclusive caterers to quote for the work. This is a simple way to start impact spending.

2. Create quarantined procurement

Quarantined procurement is also referred to as "set-asides". Quarantined procurement involves a particular procurement or portion of spend to be quarantined and offered to a type of business. For example, a portion of sub-contracts may be set aside for Indigenous Australian businesses. Quarantined procurement still require a competitive process and high quality offerings.

3. Remove barriers to participation

Large value procurement opportunities can be prohibitive for social enterprises or smaller local businesses to participate in. Applying a social procurement lens, it may be possible to break down a large procurement into smaller parts. Breaking the procurement into smaller parts may increase supplier diversity and spread the social benefit of your spend.

4. Introduce social clauses

The procurement can introduce social clauses to encourage social impact. For example, a project procurement may require vendors to outline their approach to gender equality or require a certain percentage of project staff to be women. Considering gender equality, disability and social inclusion in your purchases is a good starting point for social procurement.

Remember, start small and retain competitive principles. It is possible to create social impact without compromising service quality.