# STATE OF SOCIAL PROCUREMENTFinancing Social Impact in Supply Chains

The interplay between impact investing and corporate investment in social procurement.


## Overview

Financing social procurement requires the alignment between capital and responsible sourcing goals. Impact investors, such as Acumen, Mercy Corps Ventures, Working Capital Fund, or Yunus Social Business are providing catalytic capital, fostering the growth of innovations that deliver both financial returns and measurable social outcomes. Corporations are also recognizing the opportunity, with companies like SAP and IKEA investing in supply chain innovation to achieve compliance, resilience, and social goals.Despite these advances, the funding available for social impact initiatives remains limited compared to the global need. Unlocking the full potential of social procurement will require increased collaboration among investors, corporations, and innovators to bridge the financing gap and build more equitable and sustainable supply chains.


## The Traditional Route: Impact Investments

Impact-focused investors are increasingly turning to support innovators with social procurement opportunities as it allows their portfolio companies to ensure scalability and secure high-volume demand. These investors provide catalytic capital, aiming to de-risk and accelerate promising, impactful, technologies and social innovations. Mainstream investors see opportunities as well, recognizing that supply chains are a strategic asset to companies, increasingly buffeted by geopolitical factors. Impact-focused, early-stage venture investors like Acumen, Alante Capital, Mercy Corps Ventures, Working Capital Fund (WCF), or Yunus Social Business are backing enterprises that offer measurable social impact alongside financial returns, across supply chains. Some of these innovations operate in high-growth spaces like risk analytics and supply chain mapping (e.g. Altana, now valued at $1 billion). Others serve targeted market segments that deliver impact directly to marginalized workers (e.g. Quizrr).


## Corporate financing

Companies can finance social impact in their own supply chains and through that align their sourcing goals with initiatives that drive equity and innovation. These efforts demonstrate how strategic funding and collaboration can transform global supply chains into vehicles for sustainable impact.


## Frequently Asked Questions

*Common questions and answers*


## Novel financing mechanisms

Innovative finance is reshaping the corporate approach to social impact. The Schwab Foundation's latest report, "Beyond Compliance: Embedding Impact through Innovative Finance", highlights how this emerging practice already mobilizes $185 billion by linking financial rewards to measurable social outcomes. A range of case studies showcase how companies are exploring this approach to address critical social issues in their value chains.

[Read the report](https://www.weforum.org/publications/beyond-compliance-embedding-impact-through-innovative-finance)


### Challenges for financing social impact

Despite these examples, corporate funding for social innovation is limited compared to the scale of the opportunity: Globally there are an estimated 450 million agricultural wage worker, 3.3 billion climate-vulnerable people, and 131 million micro-, small- and medium-sized enterprises (MSME) in low- and middle-income countries with unmet capital needs. Evidence of impact and financial return is mounting, demonstrating that this is a space worthy of further investment. Procurement staff still face obstacles in finding, engaging and collaborating with suppliers who can meet their company’s social goals. Addressing this shortfall requires triangulation of needs between capital providers and internal stakeholders such as corporate philanthropy, impact investment or R&D.


### Our Partners

This section has been prepared by the Working Capital Fund.


*Partner organizations and sponsors*

Last update was made on 15 January 2025.