State of Social Procurement: Public Procurement - Global Alliance for Social Entrepreneurship

Global government procurement spending is estimated to be around $13 trillion USD per year, according to research by the Open Contracting Partnership and Spend Network.

This presents a significant driver of economic activity, and an opportunity to maximise the positive impact of this spend for nation states. Many governments are actively seeking to increase their spending through social enterprises.

As the legal chapter makes clear, regulation is shifting procurement from a price-and-efficiency function to a strategic mechanism for risk management, resilience, and value creation. In some countries, governments are going further still in explicitly mandating social procurement in order to increase their spend with social enterprises.

But with 50% of the expenditure with SMEs occurring indirectly through the supply chain, many governments are also seeing an opportunity to mandate that their suppliers buy from social enterprises.

In doing so, they are creating an opportunity for businesses with social procurement programmes to have a competitive advantage in winning lucrative government contracts.

UK Social Value and Procurement Acts

The Social Value Act 2012 was further strengthened through the 2024 Procurement Act, which aims to “maximise procurement spend with small and medium-sized enterprises (SMEs) and voluntary, community and social enterprises (VCSEs).

Australia Procurement Framework

Victoria’s 2018 Social Procurement Framework (SPF) requires all departments and agencies to consider social and sustainable outcomes in their purchasing decisions.

Taiwan Social Innovation Action Plan

The Social Innovation Action Plan (2018), together with the Buying Power Procurement Award, adopts a voluntary and recognition-driven approach, emphasizing public visibility and social impact rather than legal mandates.

Paraguay Procurement Law

The 2022 procurement law (Law 7021/2022) introduces special inclusive procurement (Contratación Inclusiva) for local SMEs and vulnerable groups. It allows public procurement procedures to be restricted or targeted to specific communities or issues.

Dominican Republic Law 47-25

Law 47-25 embeds social inclusion across selection criteria and contractual obligations. The law explicitly promotes participation by MSMEs, women- and youth-led enterprises, cooperatives, associative enterprises and other disadvantaged supplier groups.

Canada BCSPI

The British Columbia Social Procurement Initiative (BCSPI) is a regional learning hub intended to support rural governments and other public purchasers across British Columbia with capacity building, training, tools, and expertise required to integrate social procurement into existing practices.

Consequences for social enterprises

Public social procurement creates a ripple effect across the private sector when social value becomes commercially relevant. In the UK, for example, new reporting requirements under PPN002 will oblige major suppliers to disclose subcontractor-level spend with social enterprises, embedding transparency into £385 billion of annual public contracts. This presents a major competitive advantage for government suppliers with longstanding social procurement programmes such as Johnson & Johnson, Landmarc, and Sodexo.

Photo Credit: Pioneers Post, Peter Holbrook (CEO, SEUK), Minister for Civil Society Rob Wilson and Claire Dove (chair, SEUK) at No. 11, Downing St

Encouraging private social procurement in Asia

In Taiwan, the Buying Power Procurement Award has driven NT$11.8 billion in social procurement over nine years, including NT$4.1 billion in 2025. The award system includes two categories - procurement and collaboration - encouraging companies to integrate social impact into purchasing and partnerships. Listed companies account for the largest share of buyers, and participation now spans diverse industries, signaling broad private-sector support and enabling social enterprises to strengthen market competitiveness.

Agriculture and circularity in Latin America

Across Latin America, early but growing examples show private buyers contracting recycling cooperatives or smallholder agricultural associations after their inclusion in public programmes reduces risk and builds credibility.

Colombia’s sourcing requirements for smallholder agriculture within public food programmes have helped formalize producer associations that later become eligible suppliers for supermarkets and food distributors at the regional level.

Public procurement outlook

As these examples demonstrate there is a clear push from governments around the world to drive social procurement directly and indirectly. This creates an opportunity for all parties:

For large government suppliers to see social procurement as a route to business-winning and differentiation.

For governments to maximise the value of money they are spending anyway in a way that enhances people and communities.

For social enterprises to tap into this economic value to create more local, positive impact.

Photo Credit: Euclid Network / Pioneers Post

Public procurement

$13 trillion

in annual government procurement spending

$1.1 billion

spent on public procurement in Australia alone