Social procurement: the strategy that allows companies to integrate social and environmental impact
- Jessica Oyarbide
- Oct 27, 2024
- 3 min read
As the end of the year approaches, the question "what should we give as a New Year's gift?" begins to circulate among SMEs and large companies. This moment is a great opportunity to promote social procurement initiatives, which not only consider the price and quality of the products and services being sought, but also contribute to generating a positive impact.
According to the World Bank, "social procurement refers to a procurement strategy that considers not only the financial cost but also the environmental and social impact of products and services. It encourages companies to integrate suppliers who are aligned with sustainability goals, such as waste reduction, resource conservation, or promoting social equity."
Through social procurement, or social purchasing, as it is also known, companies can empower Social and Impact Enterprises and even help NGOs develop sustainable business models. To achieve a successful social purchasing strategy, collaborative work between both parties is important: customers and suppliers.
Often, companies must modify their payment policies to purchase products and services from smaller businesses that cannot afford 60 or 90 days of payment, for example. They must be able to consider the production times, operational capacity, and scale possible for these organizations. In the case of Social Enterprises, Impact Enterprises, or NGOs that sell products or services, they must work to meet certain quality standards, be able to invoice their work correctly, and fulfill orders in a timely manner, to name a few of the challenges.
In our city, there have been examples of Social Procurement initiatives. In 2016, the company Redimec underwent a change in its strategy and brand identity, led by Marcas que Marcan, which included partnerships with impactful suppliers. The corporate apparel was developed with a Social Enterprise that provided vocational training and job placement for people in socioeconomically vulnerable situations. The notebooks and notebooks were developed with a cooperative that brought together women from working-class neighborhoods and created a support group through its handcrafted graphic design.
EKHOS is dedicated to building impact ecosystems, and among its initiatives, it also promotes social procurement. In each workshop it facilitated for Impact Ecosystem stakeholders, it hired impact suppliers. It engaged the catering service of "Como lo soñaste," a social enterprise led by an entrepreneur from Barrio 31, Buenos Aires, for an impact ecosystem workshop; it hired the catering service of En Buenas Manos, led by a deaf person and a person with hearing loss, for a workshop it gave for students at the Georgia Institute of Technology in the United States; and for its India Impact Route trips, it uses various products and services provided by Social and Impact Enterprises, such as tourism experiences led by women living in poverty who were able to move forward thanks to this project.
Social procurement is proving to be an effective strategy for beginning to integrate social and environmental impact into the value chains of other companies or organizations. It can begin with sporadic purchases and gradually increase the type of products and services purchased, increasing the potential for economic, social, and environmental development.
If you'd like to incorporate social procurement strategies into your organization, please write to jessica@ekhos.org . To learn how to boost business impact with social, environmental, and economic impact, participate in the next edition of the India Impact Trail. https://ekhos.org/india and the Global Impact Businesses and Ecosystem Forum , a global forum for impact businesses and ecosystems, where leading social procurement companies will present their strategies.
Comments