# STATE OF SOCIAL PROCUREMENTRegion Profile: Latin America Transforming supply chains through social procurement. ## Overview The Latin American context of social procurement reflects a dynamic interplay of opportunities and challenges, influenced by the region’s diverse socio-economic and cultural landscapes. While social procurement serves as a transformative mechanism for integrating social enterprises and marginalized communities into formal supply chains, its implementation is shaped by structural inequities such as entrenched poverty and pervasive informality. This duality underscores the potential of social procurement to drive inclusive growth while highlighting the systemic barriers that must be addressed to unlock its full impact. # Argentina: The power of public procurement Argentina is advancing social-impact procurement through municipal and provincial programs, legal pathways, and multi-sector collaboration, integrating cooperatives and social-economy suppliers into public and corporate value chains.Photo Credit: Nilus, Argentina The initiatives and programs in the Argentine context demonstrate the government’s commitment to supporting Micro, Small, and Medium Enterprises (MSMEs) and entrepreneurs by focusing on innovation, providing training opportunities, and ensuring access to financing as key drivers of their growth and development. Over time, a variety of measures have been implemented to reinforce the entrepreneurship ecosystem, including policies that support incubators, encourage job creation in emerging sectors, enhance competitiveness through design and innovation, and expand access to financing in strategic areas such as the green economy and digitalization. Collaboration with business associations, such as the Argentine Confederation of Medium Enterprises (CAME), has further contributed to strengthening MSME training, developing capabilities, and overall business development. While specific instruments have evolved, these efforts collectively reflect a consistent policy approach aimed at promoting innovation, productive growth, and the integration of MSMEs into more dynamic and competitive markets. Additionally, in provinces such as Buenos Aires, although there is no specific law regarding social procurement, municipal and provincial programs are in place to promote public procurement with social impact, prioritizing the participation of cooperatives and civil associations.Among the most significant initiatives specifically related to social procurement are those of the Buenos Aires City Government which includes: (i) The “Buenos Aires Compra con Valor” program which fosters the participation of productive organizations from the popular and social economy in public procurement, stimulating socioeconomic development, increasing income, and creating opportunities that allow the inclusion and expansion of employment; (ii) The "Social Impact Seal" which aims to recognize companies committed to the economic development and social integration in Buenos Aires' vulnerable neighbourhoods; and (iii) The "Social Impact Procurement" initiative which encourages companies to integrate productive organizations of the social and popular economy into their value chains.Furthermore, the “Compras con Impacto” program, promoted by the Government of the City of Buenos Aires (GCBA), seeks to accelerate the integration of social-economy suppliers into corporate value chains, strengthening their productive and commercial growth. This program stands out as a robust example of public policy that effectively articulates the public sector, private sector, and social economy, illustrating how governments can actively promote social-impact procurement.In 2025, through the Red de Impacto Social, a collaboration platform connecting companies, professionals, and public sector actors to promote positive social and economic impact, the GCBA provided targeted support to these actors. This support included: (i) strengthening the productive capacities of social-economy organizations by improving internal processes and providing tailored guidance to their teams; and (ii) supporting private-sector companies to effectively execute social-impact procurement by helping them address the practical challenges that arise when integrating social suppliers. This process enabled companies to incorporate social-impact criteria into their procurement decisions, supported by tailored workshops and practical guidance designed to help them operationalize these criteria effectively.Regarding the adoption of regulations to promote social procurement linked to social entrepreneurship, it is worth noting that the newly consolidated text of Law No. 2,095 (the Public Procurement and Contracting Law of the Government of the City of Buenos Aires), already incorporates the possibility of contracting goods or services provided by Productive Units registered under the Social Economy Promotion Law (Law No. 6,376). In practice, this operates as the legal channel for social procurement in the City of Buenos Aires jurisdiction, rather than creating an autonomous regime. At the same time, this regulation incorporates sustainability principles and criteria associated with sustainable public procurement, with a particular emphasis on the social dimension. At the same time, this regulation incorporates sustainability principles and criteria associated with sustainable public procurement, including social considerations as a core component of the sustainability approach.In the Province of Buenos Aires, the government is advancing the development of a Triple-Impact Tender Document, designed to modernize a key instrument of the public procurement system. In 2025, over 19 institutions contributed proposals to update the model, incorporating the principles of integrity, sustainable development, and gender & diversity. Representatives from universities, labor unions, business chambers, professional associations, and civil society organizations provided input to build consensus on the design of a tender document aligned with these priorities. The updated tender document also includes provisions to promote the hiring of local and regional labour, while recognizing territorial and family diversity among workers. This initiative forms part of a broader participatory process to draft a new Provincial Public Works Law, ensuring coherence between future legislation and the operational instruments that implement it. The goal of the new tender document is not only to facilitate procurement but also to reflect public value and generate positive economic, social, and environmental impacts.In Argentina these initiatives focus not only on developing new technical skills and capacities, but also on creating cultural shifts among ecosystem actors, transforming how all sectors interact with Social Suppliers and contribute to inclusive development: (A) From the Private Sector: 1) developing tools to facilitate the connection between Social Suppliers and corporate buyers (e.g., inclusive procurement portals and catalogues); and 2) Development of inclusive value chains by integrating Social Suppliers through different various strategies. (B) From the Public Sector: 1) Government initiatives and programs promoting Social Suppliers' access to formal markets through inclusive policies and training, such as the Buenos Aires City Government's initiatives; 2) Neighborhood centers supporting vulnerable communities with technical training, capacity-building, and collaborative production spaces. C) From the Third Sector: 1) Partnerships with third-sector organizations (e.g., neighborhood centers or community organizations) providing training, advice, and opportunities for connecting with formal market actors; and 2) Local commercialization networks promoting the visibility and social impact of Social Suppliers’ offerings. # Colombia: Social procurement in a highly informal economy Colombia is advancing inclusive procurement and social entrepreneurship through SME-focused regulation, public programs like iNNpulsa Colombia, and partnerships linking anchor companies with vulnerable producers, despite high informality and regional disparities.Photo Credit: Fundacion Mi Sangre In Colombia, a strong entrepreneurial culture underpins innovation, with small and medium-sized enterprises (SMEs) representing 99.4% of registered businesses and playing a central role in employment generation. However, significant territorial disparities persist. Urban centres such as Bogotá and Medellín are recognised for technological innovation, while rural regions remain largely dependent on agriculture and are constrained by weaker infrastructure. Decades of internal conflict have further shaped uneven territorial development, resulting in differentiated conditions for entrepreneurship and access to formal markets. High informality, affecting an estimated 62% of the labour force, limited access to credit, and regulatory barriers continue to restrict small business growth, despite national efforts to promote inclusion and economic development.In response, a growing set of public and private initiatives is strengthening Colombia’s social entrepreneurship and inclusive business ecosystem, increasingly linking sustainability with social impact. In 2024, the Ministry of Environment and Colombia Compra Eficiente launched the Guide for Sustainable and Socially Responsible Public Procurement, providing practical guidance to integrate environmental and social criteria into public contracting processes. In parallel, the national Green Business Programme (Programa de Negocios Verdes) now certifies more than 900 sustainable producers across 29 departments, expanding opportunities for environmentally responsible enterprises to connect with both public and corporate buyers.The private sector has also advanced more inclusive and sustainable supply chain practices. The National Business Association of Colombia (ANDI) promotes responsible procurement through its Sustainable Supply Committee and the Visión Circular initiative, a network of over 380 companies adopting circular economy models, waste valorisation approaches, and partnerships with grassroots and recycling organisations. These efforts reflect a growing demand for suppliers that meet defined environmental and social standards.On the regulatory front, Colombia has implemented Law 1150 of 2007 and its regulatory framework under Decree 1082 of 2015, complemented by Decree 142 of 2023, which strengthens the participation of MSMEs, cooperatives, and organisations from the social and solidarity economy in public tenders. Together, these instruments embed social and environmental sustainability criteria into public procurement, facilitating the inclusion of diverse enterprises in state value chains. Civil society organisations such as RECON further support this ecosystem by increasing the visibility of social enterprises in sectors including education, the environment, and human rights, while strengthening their capacity to scale impact in marginalised communities.Collectively, these developments signal a gradual shift towards more sustainable, inclusive, and socially responsible procurement practices in Colombia, across both public and private sectors. This evolution is creating increasingly favourable conditions for integrating social enterprises, grassroots suppliers, and green businesses into national and regional value chains. # Mexico: Social economy law and corporate leadership Mexico combines a strong social economy legal framework with corporate leadership and certification initiatives, creating real pathways to integrate MiPyMEs and social economy organizations into formal value chains and procurement.Photo Credit: ANA Care With a population of 128 million – over twice the size of the next most populous country in Latin America – Mexico serves as a pivotal market to showcase the transformative potential of social procurement in fostering equitable economic growth. The nation’s GDP of $1.4 trillion USD is bolstered significantly by its informal sector, which contributes 25% of GDP and employs 55% of the workforce. MiPyMEs (micro, pequeñas y medianas empresas) represent 99.8% of all businesses and are recognized by the government as “the engine of our economy.” Despite their prevalence, most MiPyMEs remain excluded from formal supply chains.Mexico features an enabling regulatory framework for social procurement. In 2012, the General Law on Social and Solidarity Economy (Ley General de la Economía Social y Solidaria) formalized the concept of social economy organizations and promoted their inclusion into value chains and government procurement. The characteristics of social economy organizations are purpose beyond profit; democratic governance; and collective ownership, and main examples include artisan collectives and agricultural cooperatives. Traditional bank financing often struggles to accommodate social economy organizations, so a role for impact investing is also clear alongside social procurement to foster the social economy.More and more, large corporations are stepping forward to lead by example, and the market should take note. The Mexican Center for Philanthropy (CEMEFI) awards a certification for excellence in Institutionality and Transparency (Acreditación en Institucionalidad y Transparencia), allowing corporate social procurement leaders to showcase their efforts. Ecosystem players like ProSociedad, affiliated with Ashoka Mexico, provide a public good by training promising entrepreneurs and act like a market-maker by connecting buyers and suppliers. Corporates such as FEMSA, Grupo Bimbo, and Walmart Mexico are among the corporates who are taking active steps to incorporate the Mexican social economy into their value chains. # Peru: Decentralized platforms and impact frameworks Peru is strengthening inclusive entrepreneurship through BIC regulation, public funding, and decentralised platforms such as Kunan and NESsT, despite regional and financing constraints.Photo Credit: Cooperative Laguna In Peru, entrepreneurship is gaining traction, particularly through programs that promote sustainability and inclusion. Regulatory advancements, such as the creation of the Sociedad BIC and payment-term legislation for microenterprises, have strengthened the ecosystem. However, challenges persist, including the concentration of resources in Lima and reliance on short-term financing. Despite these barriers, Peru is fostering frameworks for inclusive growth, emphasizing the need for tailored policies, innovative financial instruments, and support to scale businesses across diverse regions.In Peru, the work of Kunan has been essential in decentralizing support for social entrepreneurship through platforms like HUB Norte and HUB Sur, which promote the inclusion of underserved regions in productive and impact-driven ecosystems. These platforms connect social entrepreneurs with development opportunities and strategic resources in rural areas. Meanwhile, NESsT complements these efforts through impact investments and technical support, benefiting over 245 social enterprises, strengthening their sustainability, and preparing them to face scaling challenges.The Pro Innóvate program, managed by the Peruvian government, provides non-reimbursable funding for early-stage social enterprises. This program not only supports the development of innovative projects but also integrates social impact measurement criteria as a key requirement for accessing its resources.On the regulatory side, Law No. 31072, which establishes the Sociedades BIC model, allows businesses to align their operations with positive societal and environmental impact objectives. Furthermore, the B Corp Certification, with over 50 certified companies in the country, reinforces the private sector's commitment to sustainability, promoting responsible and ethical practices. ## Challenges in the region In Latin America, social procurement offers significant opportunities for integrating social enterprises into corporate supply chains, driving innovation, and accessing untapped markets. By addressing social and environmental issues often overlooked by public policies, social enterprises stimulate economic growth and foster a more inclusive economy. Corporations benefit from diversifying supplier bases, meeting ESG commitments, and creating cross-sector partnerships that enhance sustainability and operational efficiency.However, challenges persist, including limited access to financing, inadequate infrastructure, and a lack of tailored policies and incentives. Informal operations and misconceptions about social procurement further hinder scalability. Addressing these barriers through inclusive policies, capacity-building, and financial innovation can create a supportive ecosystem.For social enterprises, social procurement offers pathways to economic stability and expanded impact. For corporations, it drives process innovation and aligns with consumer demands. Ultimately, social procurement acts as a catalyst for systemic change, promoting equitable and sustainable growth in the region. ## Regional case studies ## Frequently Asked Questions *Common questions and answers* ### National Partners This regional profile has been prepared by Agora Partnerships, Aspen Network for Development Entrepreneurs, Miller Center for Social Entrepreneurship, Keidos and Yunus Social Innovation. *Partner organizations and sponsors* Last update was made on 13 January 2026.