Something important happened very quietly last month.
For the first time, social enterprise peak bodies and both verification systems in Australia aligned around a single definition of what a social enterprise is.
On paper, that might not look like much. The definition itself hasn’t substantively changed. But the alignment behind it is a significant shift for the sector.
Getting the sector on the same page
For years, social enterprises in Australia have been operating with slightly different versions of the same idea.
Different peak bodies, different states, and different verification systems all used definitions that broadly aligned in spirit, but varied in wording and emphasis. That created friction, particularly when engaging with government, funders or verification.
As SECNA CEO Kylie Flament explains, when she came into her role, every single social enterprise peak body was using a slightly different definition.
“We looked at all the words side by side and went oh crikey, they are all the same in spirit, but in practice slightly different,” she says.
That difference mattered. It meant repeatedly translating your organisation to fit different frameworks, depending on who you were talking to.
“I used to run a social enterprise and it was so exhausting to have to explain myself in different terms to different bodies. You'd apply for a grant and it would say one thing and then you'd apply for something else and it would be different. And you're like, how many ways do I have to be measured?” Kylie says.
For the past few years, there has been a concerted effort behind the scenes to bring the sector onto the same page.
So, what is a social enterprise?
Australia has now aligned with the five global standards developed through the Social Enterprise World Forum and the People and Planet First movement.
A social enterprise is a business that trades to deliver social and or environmental impact, and is guided by five core principles:
- Purpose
Exists to solve a social and or environmental problem. - Operations
Prioritises purpose, people and planet in decision-making. - Revenue
Earns income through trade. - Use of surplus
Reinvests the majority of surplus into its purpose. - Structure
Uses structures that lock in purpose over time.
Kylie says aligning with the five global standards made sense.
“They're really clear. And it felt like the right way to go because we are increasingly global.”
Why this alignment matters
The significance isn’t in the wording. It’s in the consistency.
For governments, a shared definition makes it easier to design policy, funding and procurement approaches with confidence.
“The feedback that we've had sometimes, particularly from governments around Australia, is that it's hard to back a sector without a common definition,” Kylie says.
It also signals a level of maturity in the sector. Rather than competing definitions, there is now a shared foundation that reflects both Australian practice and a growing global movement.
On a practical level, having a single set of standards removes a layer of complexity for social enterprises.
“To have five standards that you can rely on and work to makes life a lot easier,” Kylie says. “You can just get on with the doing of business for good and not worry about which boxes you need to fit into next.”
One definition, two verification pathways
While the definition is now shared, there are still two verification pathways in Australia: People and Planet First and Social Traders.
There are still differences in how each system operates, including cost, process and how some edge cases are interpreted.
As Kylie notes, many organisations choose to do both.
“And we really support that,” she says. “There's no harm in having both verifications. It will take some time for those verifications to match each other in the detail.”
The key shift is consistency at the core, even if the pathways remain distinct.
A quiet milestone for the sector
This wasn’t a headline moment.
As Kylie reflects, this kind of work often happens in the background.
“You do the hard work … It's the really boring detail stuff, the behind-the-scenes stuff. And you forget to celebrate it because there's not a ribbon cutting or a ceremony. Something just clicks into place and you breathe a sigh of relief,” she says.
But it is a milestone worth recognising.