The federal government has been urged to do more to help Australian companies that try to do good as well as make money, with a report revealing that the social enterprise sector pumps $2.25bn into the economy each year.

Social Traders, which certifies such companies, ranging from coffee shops to textile firms, argues they employ more than 30,000 workers, almost half of whom would otherwise be locked out of employment.

Releasing its annual data on Monday, Social Traders CEO Tara Anderson said social enterprise was “business at its best” and the government could help by changing procurement policies to encourage the purchase of goods and services from the sector.

“We are on a mission at Social Traders to make social enterprise business as usual,” she said. “We’re advocating for businesses to buy from social enterprise, government to create supportive policy, and government, investors and philanthropy to back the sector’s growth.

“It’s the business model of the future. Imagine an economy where every business was a social enterprise, where instead of business only maximising dividends for shareholders, we had every business creating purposeful impact for communities and the planet at the same time.”

Social enterprises have various models: employing people who are marginalised; offering products and services that are more affordable and more accessible; and donating a percentage of profit to causes and working with charity partners to reinvest the money. Some mix all three.

Ms Anderson said that social enterprises also demonstrated that mainstream companies could do business and do good, as both consumers and employees now demanded.
The annual report analysed data from 518 social enterprises across Australia and found trading revenue is up by 32 per cent in the last financial year, with 75 per cent of revenue coming from business activities rather than grants or donations.

Ms Anderson said the enterprises included cafes and other hospitality outlets, HR and consulting services, spatial analytics and mapping, environmental services such as recycling and office decommissioning services.

“They sit across all sorts of professional services, as well as products and services,” she said. “All sorts of clothing and textile businesses … they sit in any part of the economy … they’re dotted all over the place. (We’re) encouraging business and government to build social enterprises into their supply chain, so they actually get access to contracts.”

The sector is also looking for social impact investment as well as philanthropic grants.

Ms Anderson said people who set up social enterprises were generally “incredibly innovative, entrepreneurial and passionate … with some sort of commitment to the cause that they’re working for”.

This article first appeared in The Australian on 18 Sep 2023, written by Helen Trinca: Social Traders urges support for social enterprise sector | The Australian