Five minutes with … Mark Daniels, Executive Director, Social Traders

Mark Daniels from Social Traders

Mark Daniels is the executive director of the Melbourne-based not-for-profit Social Traders, which works closely with the Victorian Government and is helping combat disadvantage.

Founded in 2008, Social Traders connects companies such as Westpac, Australia Post, Mirvac, L’Oreal, AMP, Coca Cola Amatil and Nestle with social enterprise to combat disadvantage. Daniels is a leading figure in the social enterprise movement, which is fast gaining momentum – there are about 20,000 social enterprises nationally, with over 30 per cent beginning trading in the past five years. By 2021, Social Traders plans to have 95 buyer members spending $105 million per annum with 600 certified social enterprises.

How is Victoria leading the way in social enterprise reform?

Victoria is the first state government in Australia to develop a Social Enterprise Strategy, to set mandatory social procurement targets in major projects and to develop a social procurement framework. The Victorian Government has also supported the work of Social Traders since 2009, as a social enterprise intermediary. As a direct result Victoria is the clear national leader in social enterprise; no other state has recognised the potential of social enterprise and created an enabling environment for social enterprise in such a cohesive manner. Other states are beginning to develop an interest in this space, particularly in social procurement, but to be successful will take time – building demand for buying from social enterprise will have a limited impact without a commitment to building the available capacity of the local social enterprise market. This is where Victoria has invested well over the past decade.

Can you give an example of Victoria’s leading stance?

The Victorian Government has introduced social procurement into their approaches for addressing disadvantage via their $40 billion spend on new infrastructure across Victoria. In projects like the Level Crossing Rail Removal Project, there’s now a requirement that three per cent of the supply chain is made up of social enterprises, Indigenous businesses and the direct employment of marginalised groups. Through this approach, major infrastructure providers are now contractually required to deliver social impact because of winning business, and the direct result is that the billions of dollars being spent by government is now creating jobs for hundreds of people who would otherwise be out of the workforce.

How does government work with your enterprise?

The Victorian Government has worked closely with us to develop a policy and process for introducing social procurement. While this work initially focused on infrastructure, it’s now expanding to incorporate other areas of government contracts and expenditure. By shifting the way they spend, the Victorian Government is sending a strong signal to industry that they place a high value on social impact. Consequently, we’ve become a supplier of certified social enterprises to a significant number of major contractors to government. Those contractors are now looking at ways in which they can deliver social benefits for all clients irrespective of whether they ask for it, which in turn is changing what business-as-usual looks like. The Victorian Government has also provided significant funding support to Social Traders to grow the impact of social procurement and to grow the capacity of social enterprises to deliver on business and government contracts.

How do you encourage corporate Australia to assist disadvantaged Australians?

We’ve been working closely with Australian businesses to raise awareness of social enterprises and social procurement. This started with advocacy and networking, resulting in the report Corporate Social Procurement in Australia in 2014. And this led to the development of a new service to support corporate and government entities to engage social enterprises in their supply chains.

Which big brands have you worked with?

The service developed by Social Traders has resonated strongly, with 20 business and government organisations becoming buyer members over the past 24 months. Large businesses to join the social procurement movement include Westpac, Australia Post, Mirvac, John Holland, Coca Cola Amatil, Laing O’Rourke, Broad Spectrum, CPB, Charter Hall, Boral, AMP, McConnell Dowell, L’Oreal, Downer and Nestle.

How do you support these businesses?

We give them access to rich data on certified social enterprises; support in integrating social enterprises into their supply chains; access to a buyer network; measurement of the impact of their spend; staff engagement through training; networking events; and expert advisory services.

Is social procurement on the up?

Yes, social enterprise is on the rise and as a result social procurement is growing rapidly. It’s now on the agenda of many governments and businesses and is becoming a recognised term in the procurement profession. This is being complemented by new international standards such as ISO 20400 Sustainable Procurement Guidance, which has raised the profile of social procurement globally.

What roadblocks do you still need to overcome?

Many businesses are not yet aware, or considering becoming part of, this movement. There are also challenges in relation to the capacity of the social enterprise suppliers. Social Traders is now working closely with social enterprise suppliers to build their capacity to deliver at the volumes required by corporates and government.

What do you love most about your role?

It’s a dream job, supporting the creation of a new marketplace where every cent spent changes people’s lives. Not many people get to work in such an amazing area of social innovation. I can see a time in the next decade where most businesses in Australia will know what social procurement is and they will be actively engaging with it. Potentially, this means that a larger portion of the $600 billion spent per year by business and government might deliver significant job outcomes for disadvantaged Australians. That’s pretty exciting.

Social Traders biggest wins in 2017?

We estimate that we’ve enabled the employment of 300 people, including people with disabilities, mental health issues, long-term unemployed, people at risk of homelessness, migrants and refugees, young people and many other groups, all at little or no cost to the broader community. We undertook a strategic review and made a commitment to focus all our efforts on delivering 1500 jobs for disadvantaged people through social procurement by 2021. This resulted in us developing clear targets for buyer and supplier numbers and led to a significant commitment to building the capability of certified social enterprises – knowing that we now have resources to build supply and demand in the marketplace is really exciting. And we developed an effective format for networking between buyers and suppliers that has accelerated deals occurring in the marketplace.

Goals for Social Traders in 2018?

To develop a robust supplier capacity that tightly integrates with the buyer servicing already taking place; to introduce a portal for our buyer members and certified social enterprise suppliers to access information that makes it easier to identify opportunities to work together; and to grow social procurement spend among Social Traders buyers.

Mark Daniels’ top tips for other social enterprises looking to work with the Victorian Government:

  • Tip 1: Develop the capability to deliver on government contracts. “Being a social enterprise alone will not get an organisation work unless it can demonstrate the capacity to deliver. No organisation will give a social enterprise work unless they believe that the supplier has that capability.”
  • Tip 2: Become a Social Traders-certified social enterprise. “Government (and business) will increasingly be using Social Traders to source information on social enterprises relevant for their contracts.”
  • Tip 3: When pitching your business, don’t get too focused on your social message. “Social message is important but not if you can’t solve the buyer’s business problem. In your pitch, communicate: this is who we are and this is what we do; these are the social benefits that we deliver. First and foremost, markets exist for trade.”

Mark Daniels’ CV snapshot

Before co-founding Social Traders, Mark was Social Enterprise Manager at the Brotherhood of St Laurence and also developed policy and community development for inner city public housing estates in Melbourne. He’s a director on the Board of Yarra Community Housing and has a Bachelor of Arts from Monash University, a Graduate Diploma in Education and a Graduate Diploma in Urban Policy and Planning from RMIT.