Paving the Way for Business Resilience and Sustainability
Social procurement is emerging as a significant pathway for companies to meet their sustainability goals while creating social value, particularly evident in the ecosystem of EU-based companies with a global presence. As companies adopt social procurement to engage with mission-aligned social enterprises, it contributes to ESG strategies, the Sustainable Development Goals (SDGs), stimulates underleveraged sections of the economy and ensures compliance with emerging regulations.
Further, social procurement serves multiple benefits for businesses at large:
– Reducing environmental footprint
– Furthering innovation in new business models and new markets
– Cascading ethical practices among supplier networks
– De-risking supply pressures
– Bolstering financial performance
– Creating an impact premium
– Enhancing brand reputation
Some early drivers of social procurement include geo-political unrest, black swan events like the COVID-19 pandemic, and extreme weather events due to climate change that significantly disrupt supply chains, giving rise to the necessity to create more resilient and inclusive supply chains.
As we deep-dive into the experience of EU-based companies with an Indian footprint, we observe that the changes in the regulatory environment, such as EU-level procurement directives, India’s BRSR reporting mandates, and policies in business and digital, are providing momentum for social procurement. For example, the European Union’s public procurement directives, the Critical Raw Materials Act, and the ‘Buying Social’ Guide have significantly influenced the social procurement and supply chain strategies of companies.
Within India, the government has taken significant steps to enable the growth of MSMEs and small producers across the country – these span initiatives such as the Government eMarketplace (GeM), Open Network for Digital Commerce (ONDC), and Make In India. Additionally, reporting mandates like BRSR have encouraged listed companies to engage more deeply with supply chain sustainability and social procurement.
Click on the ‘download pdf’ link on the right side of this page to access our report on Social Procurement.
