What if you didn’t need to budget for CSR?
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One of your most effective CSR strategies in the COVID-19 recovery won’t cost anything to activate
As Australia begins the journey out of the COVID-19 wilderness, there has never been a more important or opportune time for Australian businesses to support their communities.
There will certainly be an expectation from customers, investors, employees and other stakeholders that businesses contribute to community recovery.
Understandably, the immediate priority for many businesses will be getting their operations and people back on track. Business leaders may well argue that CSR initiatives are not the most pressing. Or that the COVID impact means there is no money for CSR.
But what if supporting communities was part of existing day-to-day operational expenditure? What if helping vulnerable people get back on their feet and getting the business humming again could be all part of the same exercise?
It can. By adding social enterprises into your supply chain.
Some of Australia’s most well-known brands have already done so and delivered tangible social impact in the process.
For example, a social enterprise nursery in Victoria created 10 new jobs for people with an intellectual disability, thanks to a $500,000 contract to supply plants to the Melbourne Level Crossing Removal Project (LXRA).
Property company Mirvac created six new jobs for people exiting the justice system and diverted more than 290 tonnes of office hard waste from landfill at the same time, through buying from a local social enterprise logistics company, Mates on the Move.
There are approximately 1,000 social enterprises, with a collective turnover of $2 billion, already supplying to governments and businesses right around the country.
Adding social enterprises into supply chains is proven to work. Through the Social Traders marketplace, a spend of $105 million from 45 business buyers enabled social enterprises to create 700 jobs, deliver $4 million in low cost services to vulnerable people and donate $2 million to local communities.
So, what is a social enterprise?
Australia’s social enterprise sector offers a ready-made and sustainable market solution.
Social enterprises sit in between the private sector and charity worlds. They blend profit and purpose. They are businesses like any other, but they exist to support the most vulnerable in our communities, through job creation and community investment, and to tackle social, environmental or cultural challenges.
Social enterprises operate in all industry sectors in the economy, from facilities management, to waste management, to catering and hospitality, to business administration.
As part of the Social Traders marketplace, more than 80 of Australia’s largest businesses are already allocating some of their essential procurement spend to social enterprises. John Holland, Microsoft, Lendlease, Westpac, Coca Cola Amatil, Microsoft, SAP and Transurban are just some of the well-known brands that are leading the way. Last year, Australia Post alone spent $11m with social enterprises.
The critical element of this spend is that it represents funds allocated for essential op-ex. It’s money that would have been spent anyway. It’s not money budgeted separately for CSR, yet it achieves the same CSR goals.
These aren’t just numbers, they are lives changed. All through businesses buying goods and services they planned to anyway and getting double value for money.
Why it makes business sense to buy from social enterprise
By allocating a small portion of procurement spend to social enterprises, businesses have changed the lives of some of the most vulnerable people in the country. But buying from social enterprise also makes good business sense.
Community-focused supply chains are more robust. Many businesses have found themselves vulnerable when offshore supply chains collapsed. The crisis has highlighted the limitations and fragility of global supply chains. Building a diverse and local supply chain will de-risk your business.
Future employees are increasingly expecting their employer to have a purpose beyond profit. Making a positive contribution to communities boosts staff engagement and attracts the best talent.
Good businesses build customer demand and brand loyalty. The current crisis has brought into stark relief the importance of businesses facing the reality of the situation with authenticity and compassion. The businesses that invest now in growing and showcasing their purpose will emerge with stronger brand equity on the other side of COVID-19.
Governments will be looking for the private sector to partner with them in delivering positive social outcomes in the COVID-19 economic recovery. Delivering social impact is becoming an increasingly important factor in winning contracts with Government.
As we move into the recovery phase, now is the time to join the business leaders buying from social enterprise
Yes, Covid-19 has shaken up our economy in a way we never could have predicted only a few months ago. We’re now staring down the barrel of over 10% unemployment and early predictions of an economy shrinking by 7%. Many of our thriving industries have been hibernating.
Incorporating social enterprises into existing supply chains is a very real and immediate means of delivering the corporate social responsibility your stakeholders expect – while boosting your business and speeding up our economic recovery at the same time.
Post COVID-19, we are all shaping the future in a more powerful way than before. Let’s use this opportunity wisely. Let’s make sure that the money we spend today is helping to build a stronger Australian economy for the decades to come.
The Social Traders Marketplace makes it easy
Buying from social enterprises is simple through the Social Traders Marketplace, which connects business buyers with social enterprise suppliers across Australia.
Social enterprises are certified using a world-leading social impact due diligence process, so businesses know they are genuine. Businesses are supported by Social Traders to build the systems, structures and internal culture to prepare them to buy from social enterprise. Introductions are made to social enterprises ready to supply in their industry sector.
If there was ever a time to start buying from social enterprises, it’s now.
David brings extensive experience leading strategic business-community partnerships at Rio Tinto, Toyota and Amcor; as well as industry and government policy development and key stakeholder engagement experience.
Appointed Managing Director of Social Traders in 2009, David is an Executive Director on Social Traders’ Board and has responsibility for development and implementation of the organisation’s strategy, staff recruitment and engagement with key government, philanthropic, business and research partners.
