Predictions for 2018: Social Enterprise
Thursday, 1st February 2018 at 8:00 am
Social Traders managing director David Brookes shares his three expectations for social enterprise for the coming 12 months, as part of a series of 2018 predictions from leading experts across the social sector.
It was just over 12 months ago that I predicted social enterprise in Australia was on the rise, well on the way to being seen as part of the mainstream.
My prediction for 2018 is that social enterprise will actually make its way to joining the mainstream economy, as we see further interest and engagement from governments along with the community and private sectors.
Social enterprise is increasingly being recognised for its significant economic and social contribution. The recent Map for Impact project conducted by Swinburne University’s Centre for Social Impact, found that social enterprise was contributing $5.2 billion to the Victorian economy and employing 60,000 people.
Here are three expectations for the coming 12 months that support my 2018 prediction for social enterprise in Australia:
- Growth will come from business and government increasing their purchasing from social enterprise
The demand-side of the market will be the driver of marked growth in 2018 where both business and governments seek to increase their procurement from social enterprise.
The fundamental aspect for managing social procurement demand from public and private sector buyers will be to reduce the perceived risks of purchasing from social enterprises as they are incorporated into large supply chains.
To do this, business and government will need to be able to identify credible and capable social enterprises. Being able to find social enterprises easily and assess their capability and capacity will significantly assist the success-rate of enterprises winning work from business and government.
At a broader level, we also expect that social business and social entrepreneurship in general will continue to go from strength to strength. The rise of purpose-led businesses and the evolution of how “value” is defined and measured, continues to drive awareness of being able to generate positive social impact through the marketplace.
- Trading capability will improve in response to expanding market opportunities
One of the biggest challenges for social enterprise in 2018 will be business and government demand outstripping the supply of social enterprises that are capable of fulfilling contracts.
Just being a social enterprise alone will not result in winning new contracts. No business or government buyer will give a social enterprise work unless they believe that the supplier has the capability to deliver.
We expect that on the supply side of the Australian market, social enterprises will rise to this challenge with a focus on building their operating performance and capability to capitalise on the expanding demand for their services. However some social enterprises are likely to find themselves getting close but missing out on emerging contract opportunities; there will be a need for these enterprises to focus on specific areas for improvement to enhance their chance of winning emerging business.
- Policy leadership will play a critical role in realising the potential of social enterprise
While awareness of, and interest in, social enterprise has been on a steady positive trajectory over the last 10 years, we have witnessed a steep change in the policy environment across the public and private sector in the last 12 months.
The release of the first statewide Social Enterprise Strategy in Victoria in February last year was a huge milestone. The Victorian government now has a strong commitment to improve access for social enterprise to both capacity building support and new market opportunities. I’m confident that other governments around Australia will follow this policy leadership from Victoria.
2018 will see further disruption occurring in traditional procurement, with the release, also in 2017, of a new international industry standard ISO 20400, which promotes integration of sustainability within procurement decisions and processes.
After many years of advocating for social procurement, industry leaders are proactively embracing social enterprise and social benefit suppliers into their projects and business operations.
Off the back of the Social Enterprise Strategy, the Victorian government will take further steps to realise social outcomes via the launch of a new Social Procurement Framework Policy in coming months.
This deliberate policy leadership by government and industry, particularly in the procurement area, will be instrumental in realising the potential for social enterprise to scale and expand their already significant impact in communities across Australia.
About the author: David Brookes is the managing director of Social Traders and an executive director on Social Traders’ board. He has responsibility for development and implementation of the organisation’s strategy, staff recruitment and engagement with key government, philanthropic, business and research partners. He is also an inaugural director of the Social Enterprise World Forum (SEWF) Community Interest Company (CIC) established in July 2015.