What Counts as Social Procurement Spend

What Counts as Social Procurement Spend?

The short answer: more than most organisations realise.

Social procurement spend refers to purchasing from suppliers that can demonstrate genuine social impact, alongside delivering quality, reliability and value for money.

In practice, this means directing spend toward suppliers that:

  • create employment for people facing barriers to work
  • operate as certified social enterprises
  • support Indigenous economic participation
  • reinvest profits into social or community outcomes
  • can evidence and report on their impact

What often surprises organisations is how many everyday purchases can qualify as social procurement.

Why “what counts” matters

One of the most common barriers to adopting social procurement is uncertainty.

Procurement teams frequently ask:

  • Does this category really count?
  • Is this type of spend recognised?
  • Will this stand up to internal or external scrutiny?

Clarifying what counts as social procurement spend helps organisations:

  • move from intention to action
  • identify low-risk starting points
  • avoid tokenistic or unverified claims
  • report confidently on outcomes

The key principle: intent + verification

For spend to genuinely count as social procurement, two things must be present:

  1. Intent
    The organisation has intentionally chosen a supplier because of their social impact.
  2. Verification
    The supplier can demonstrate and substantiate that impact.

Without both, spend may be ethical or values-aligned — but it may not qualify as social procurement.

Suppliers that typically qualify as social procurement

While definitions vary slightly by framework, social procurement spend most commonly includes purchasing from:

Certified social enterprises

Businesses that exist primarily to deliver a social purpose and reinvest profits into impact, supported by third-party certification.

Indigenous-owned businesses

Organisations that contribute to Indigenous economic participation and self-determination.

Disability and inclusive employers

Suppliers that create supported employment pathways for people with disability or neurodivergent individuals.

Social impact suppliers

Businesses that can clearly demonstrate measurable social outcomes tied to their operations.

Verification — through certification, reporting or governance — is what allows this spend to be recognised and reported.

Categories where social procurement spend commonly occurs

A common misconception is that social procurement only applies to large or specialised contracts. In reality, many of the strongest opportunities sit within everyday operational spend.

Common categories include:

Branded merchandise and promotional products

Items such as onboarding packs, event merchandise and corporate gifts are often:

  • repeat purchases
  • low procurement risk
  • easy to scale
  • simple to report on

Uniforms and apparel

Workwear, uniforms and PPE can support social procurement when sourced through verified social suppliers.

Catering and events

Food, beverage, event services and logistics frequently present opportunities to engage social enterprises or Indigenous suppliers.

Logistics and fulfilment

Packing, distribution and fulfilment services can create inclusive employment outcomes when delivered by social enterprises.

Marketing, print and communications

Design, print and promotional services are common entry points for organisations beginning their social procurement journey.

These categories are particularly effective because they are embedded in day-to-day operations, rather than being one-off initiatives.

What does NOT usually count as social procurement spend

Understanding what doesn’t count is just as important.

Generally, the following do not qualify on their own:

  • donations or sponsorships
  • charitable giving without a procurement transaction
  • unverified “social impact” claims
  • suppliers without evidence of outcomes

While these activities may be positive, social procurement specifically relates to purchasing goods or services that deliver impact as part of normal business operations.

How organisations recognise and record social procurement spend

Most organisations track social procurement spend through:

  • supplier classification (e.g. social enterprise, Indigenous-owned)
  • contract or purchase order tagging
  • spend analysis by category
  • supplier reporting on outcomes

Clear documentation allows organisations to:

  • report accurately in ESG or sustainability disclosures
  • respond to audits or internal reviews
  • demonstrate credibility to stakeholders

This is why working with suppliers that understand impact reporting is critical.

Starting small: a practical approach

Organisations new to social procurement often start by:

  • identifying one or two suitable categories
  • trialling social suppliers alongside existing vendors
  • building internal confidence and understanding
  • expanding over time

This phased approach helps teams:

  • manage risk
  • build internal buy-in
  • avoid disruption to existing operations

Importantly, small purchases still count — particularly when they are repeatable and measurable.

Common misconceptions about what counts

“It has to be a big contract.”
In reality, repeat everyday purchases often deliver the most consistent impact.

“It only counts if it’s mandated.”
Voluntary social procurement spend is still valid and reportable.

“Only certain industries qualify.”
Social procurement can apply across almost all sectors and categories.

Why clarity on social procurement spend matters

Clear definitions empower organisations to:

  • move beyond hesitation
  • embed impact into existing processes
  • avoid greenwashing or tokenism
  • report with confidence

When organisations understand what counts, social procurement becomes practical, scalable and sustainable — not an added burden.

Bringing it back to social procurement in Australia

In the Australian context, social procurement spend is recognised when it:

  • aligns with procurement policies or ESG strategies
  • involves verified social suppliers
  • delivers measurable outcomes

Every organisation already spends money. Social procurement simply reframes that spend to deliver greater overall value.

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Written by Viki Govic, Founder – Better Merch
Last updated: Dec, 2025