What’s the focus of social enterprise in 2023?

Creating a universal definition of social enterprise is one of several key priorities for the sector this new year, one industry leader says, and the solution starts with multi-disciplinary support.

Procurement frameworks, social enterprise education and harnessing the lessons of the pandemic are among key priorities for the sector this year, seasoned social enterprise leader and CEO of Social Enterprise Network Victoria (SENVIC) Nick Verginis tells Pro Bono News.

There’s no doubting the significant impact of social enterprise in Australia – value that is only continuing to grow.

There are 12,000 social enterprises operating across the country, which contribute $21.3 billion to the economy each year and generate over 206,000 jobs, found research from Social Enterprise Australia.

Meanwhile data from Social Traders’ Pace report revealed Australia’s 460 certified social enterprises re-invested $513 million annually to create impact in the community between 2018 and 2022. This equates to nearly a third (29 per cent) of all social enterprise revenue being directed into delivering impact.

Defining social enterprise

While the value of social enterprise is clearly demonstrable, many people still struggle to understand the sector, says Verginis, who has seen this first-hand through his work at SENVIC, an organisation aiming to foster a thriving community of social enterprises across the state.

“There’s a lot of confusion and misunderstanding about what social enterprise is,” explains Verginis.

“I suppose the old ways of thinking and the binaries between [being] either business or charity are really hard to undo. That’s really at the core of it, I would say. It’s a mindset shift.

“I think it can be a life changing thing for some people… to actually see that there’s something in between that can do the best of both. It really changes people’s perspective – and that’s the biggest hurdle, just getting that message out there.”

There is no legal structure for social enterprise in Australia. Instead, each state offers its own definition, requirements and support.

See more: Victoria launches new social enterprise strategy

Social Traders – which certifies social enterprise across the country – defines these businesses for good as organisations that have a defined community cause; derive a large portion of income from trade; and invest efforts and resources into its purpose so that public benefit outweighs private gain.

“It’s one of those things that has really lacked from getting the kind of government support every other part of our community receives in terms of just having clarity of identity, belonging, community,” continues Verginis.

Verginis says working with educational institutions as well as the government to increase awareness and knowledge about social enterprise is a key priority for the sector in 2023. 

Doing so, he says, will help remove the burden on social enterprise owners and operators themselves to demonstrate their worth.

“[Social enterprise] is redefining business. You’re redefining community engagement, participation and economic engagement.

“This is really about systemic change – and it doesn’t happen if social entrepreneurs are doing that by themselves. What we’ve seen in the past and moving forward is that collaboration and coordination [is] going to make real lasting systems change.”

See more: When is a social enterprise a social enterprise?

A focus on procurement

Social procurement, which involves companies using its buying power to generate greater social value than the goods or services it has procured, also plays a core role in social enterprise – and is another area of interest in 2023.

It’s a priority especially pertinent for Victorian social enterprises, with the state set to undergo a review of its social procurement framework this year.

“What we expect in the next 12 months [is] to have some deep conversations about what’s needed to have real impact with social procurement. The big shift there is, I think, moving from transactional conversations to relational ones,” says Verginis.

“That means looking beyond just very light touch compliance, because there’s probably a risk of socialwashing and greenwashing going on currently, to how you make a real change under a social procurement framework, [and] how you share the benefits of social procurement rather than leaving it to market forces.

“I think more equity in distribution of the benefits is what we’ll see in the next iteration of social procurement.”

See more: New government policies target greenwashing

Navigating the lessons of COVID

Finally, Verginis recognises that while some states have been impacted by the COVID pandemic more than others, he sees clear opportunities for the sector to take advantage of its lessons this year.

“Other trends that have happened with COVID probably work to our favour. I think, with the great resignation, quiet quitting, people’s motivation has shifted significantly.

“People are searching for greater meaning, and more of a long term perspective about what they do and how they spend their money too – there is a clear sense that… our buying power, at whatever scale, is shaping the kind of world we have and the kind of future we want.

“I think the pandemic has accelerated that and social enterprise should be the beneficiary of that. Hopefully, that means we can retain talent, we can grow talent and we can expand our businesses, because we’ve got a pool of staff that want to work for places like us.”