A guide to understanding social procurement and social values.
What is social procurement?
Social procurement involves the deliberate use of purchasing to create ‘social value’.
This is achieved through creating new cross-sector partnerships between government, private sector, social benefit and community-based organisations.
What is social value in procurement?
In simple terms, ‘social value’ is the net economic, social and environmental benefit a purchase of goods or services can bring to a community beyond the delivery of efficient goods and services and the function of the asset procured, considering counterfactuals such as:
- Deadweight – what would have happened anyway;
- Attribution - what else could have contributed to the change;
- Displacement - what other benefits does the intervention displace/push aside;
- Substitution - losses for others who might have lost out;
- Drop-off - reducing benefit over time;
- Culture - cultural differences in perceptions of value.
Creating social value
Social value can be created in many ways by the organisations that you purchase from:
- Providing employment opportunities for groups who may be disadvantaged in the labour market such as people with a disability, Indigenous peoples, refugees, migrants, homeless, youth at risk, ex-offenders and women in highly masculinised industries etc.
- Providing business opportunities for minority and social benefit suppliers such as social enterprises, B Corps etc.
- Community involvement (corporate volunteering, supporting local charities , donations to good causes etc)
- Fair business practices (responsible sourcing and supply chain management, respect for commercial and labour, fair pay, fair business relationships etc)
- Human rights (promoting equality and diversity, respecting local cultural rights, freedom of association and expression, modern slavery etc)
- Labour practices (providing employment, safe and healthy workplace, good working conditions and wages, opportunities for human resource development/training, work-life balance etc)
- Environmental (reduce pollution, emissions and waste etc)
- Consumer issues (privacy and data protection, safe and healthy products etc)
- Good governance (accountability, transparency, accurate reporting, respect for law, involvement of staff and stakeholders in decision making etc.)
- Responsible supply chain and purchasing activities (their own social procurement)