Certified vs Non-Certified Social Enterprises: What’s the Difference?
The distinction matters when procurement decisions carry risk
As social procurement becomes more common, organisations are increasingly engaging with suppliers that identify as social enterprises. While many of these organisations are genuinely purpose-driven, not all social enterprises are certified.
From a procurement perspective, this distinction matters.
Understanding the difference between certified and non-certified social enterprises helps organisations:
- manage risk
- apply consistent due diligence
- report confidently on social outcomes
- avoid unintentional misclassification
This article explains the difference in practical terms - focusing on what certification changes, rather than making value judgements.
What both certified and non-certified social enterprises have in common
At a high level, both certified and non-certified social enterprises typically:
- operate as trading businesses
- exist to deliver positive social outcomes
- reinvest some or all profits into their mission
- aim to create impact through their operations
In many cases, the intent is genuine on both sides.
The difference lies not in motivation, but in verification.
What makes a social enterprise “certified”
A certified social enterprise has undergone independent assessment against a defined set of criteria.
While certification frameworks vary, certification generally confirms that:
- the organisation has a clearly articulated social purpose
- social impact is embedded in the business model
- profits are reinvested in line with that purpose
- governance and ownership structures are transparent
- impact activity can be evidenced
Certification provides external validation, rather than relying solely on self-description.
What it means to be a non-certified social enterprise
A non-certified social enterprise may still be:
- values-driven
- impact-focused
- community-oriented
However, without certification:
- claims are usually self-reported
- verification varies from supplier to supplier
- due diligence requirements increase
- comparability across suppliers decreases
For smaller organisations or early-stage social enterprises, certification may not yet be in place - but from a procurement standpoint, this creates additional assessment requirements.
Why certification matters in procurement contexts
Procurement teams are responsible for ensuring decisions are:
- defensible
- consistent
- aligned with policy and governance frameworks
Certification supports these responsibilities by:
- providing a clear classification mechanism
- reducing subjectivity in supplier assessment
- supporting audit and reporting processes
In contrast, engaging non-certified social enterprises often requires:
- deeper document review
- bespoke due diligence
- internal justification for decisions
Neither approach is inherently wrong - but the time, effort and risk profile differ.
Certification and consistency across organisations
One of the challenges in social procurement is consistency.
Without certification:
- different teams may apply different definitions
- supplier assessments may vary
- reporting outcomes may lack comparability
Certification helps create a shared baseline across:
- procurement
- ESG
- finance
- legal
This shared understanding is particularly valuable in large or decentralised organisations.
Reporting and audit considerations
For organisations reporting on social procurement spend, ESG outcomes, or supplier diversity, certification simplifies reporting.
Certified suppliers:
- provide a clear basis for classification
- reduce the need for narrative justification
- support repeatable year-on-year reporting
Non-certified suppliers may still be included, but often require:
- additional explanation
- supporting documentation
- manual verification
In audit or review contexts, certification provides a clear reference point.
Certification is not a judgement on quality or capability
It is important to distinguish certification from operational performance.
Certification:
- does not guarantee suitability for every contract
- does not replace quality or capability assessment
- does not remove the need for standard procurement evaluation
Procurement teams still assess:
- price and value
- quality and service levels
- delivery capability
- risk
Certification sits alongside these considerations - not above them.
When organisations prioritise certified suppliers
Many organisations choose to prioritise certified social enterprises when:
- social outcomes are being formally reported
- procurement decisions require additional scrutiny
- reputational risk is high
- consistency and defensibility are essential
This does not exclude non-certified suppliers entirely, but it helps organisations direct effort where verification matters most.
Making informed procurement decisions
Understanding the difference between certified and non-certified social enterprises allows organisations to:
- apply appropriate levels of due diligence
- select suppliers confidently
- align procurement with governance and ESG expectations
Certification provides clarity.
Non-certification requires additional assessment.
Neither approach is inherently right or wrong - but the distinction is critical.
Bringing it back to certification
Certification exists to support trust, transparency and consistency in social procurement.
For procurement teams, the question is not whether a social enterprise is “good” or “bad” - but whether its social impact can be verified and relied upon.
That is the practical difference certification makes.
Related topics
- What Is a Certified Social Enterprise?
- Why Certification Matters in Social Procurement
- How Certification Reduces Risk for Procurement Teams
Written by Viki Govic, Founder – Better Merch
Last updated: Jan, 2026