Around the world, some 10 million social enterprises are changing the way people see and do business by putting people and the planet above private profit. But to many in the business world, that model comes with a persistent misconception – that putting purpose above profit means a social enterprise can’t be a sustainable business at all.

To find out more about how to change that perception, we spoke to Laura Thompson, CEO and co-founder of Clothing The Gaps, an Aboriginal social enterprise, B Corp and advocacy-focused  streetwear brand. Laura shared her insights on the barriers social enterprises face and how they can be overcome.

Can you tell us a bit about your career so far and how Clothing The Gaps started?

My career began in health services. I hold a Master’s in Public Health and spent a decade at the Victorian Aboriginal Health Service (VAHS) and one of my roles included leading the Healthy Lifestyle Team. That’s where I met Sarah Sheridan, a non-Indigenous student doing her placement, who later became my business partner.

While working at VAHS, we saw the limitations of relying on government funding, where external agendas often dictated our programmes. Sarah and I wanted to create a more independent model and started Spark Health, a health promotion business subcontracting to Victorian Aboriginal community organisations.

As part of Spark Health, we developed Spark Merch, a merchandise arm that incentivised participation in our programmes. When COVID hit and in-person activations ceased, Spark Merch evolved into Clothing The Gaps. Along the way, we led the “Free the Flag” campaign after receiving a cease-and-desist notice for using the Aboriginal flag on our designs. 

This movement was pivotal to our brand’s identity and the success of “Free the Flag” campaign demonstrated the power of fashion to drive social change. It showed us how a simple tee could become a catalyst for meaningful conversations, unite communities, and influence policy. This realisation has shaped how we approach everything we do at Clothing The Gaps, from designing products to creating campaigns that inspire action.

Credit: Clothing The Gaps

Can you explain Clothing The Gaps’ mission and what makes you different?

We’re more than just a fashion label – we’re an advocacy brand. Our clothes are designed to start conversations and inspire action around important social issues. Celebrating First Nations People is central to everything we do.

While fashion is one component of our work, we’re most proud of the community we’ve built. For instance, 165,000 people signed our “Free the Flag” petition, which ultimately led the government to purchase the copyright for the Aboriginal flag and make it free for public use. 

As an independent business not reliant on government funding, we can campaign effectively and authentically. This autonomy and self-determination is a powerful tool for driving change.

Why is verification important for purpose-driven organisations?

Anyone can claim to be sustainable or socially responsible, but we wanted to ensure there was no doubt about our impact. That’s why we pursued verifications and accreditations that hold us accountable. Clothing The Gaps is certified by People and Planet First, B Corp, Social Traders, Ethical Clothing Australia and both state and national Aboriginal business chambers of commerce – I don’t think there are any more badges we can get!

These certifications help us explain the work we are already doing. We didn’t change our values or approach to work to get these certifications. However, displaying these badges prominently on our website and communications consolidates that we are doing what we say we are. It also takes the burden off customers to verify our claims and pushes us as a business to continually improve.

What do you hope to see from the social enterprise movement in the future?

Running a financially viable social enterprise is tough. Balancing an impact-driven mindset with daily financial pressures often feels like walking a tightrope. Many social enterprises still depend on government funding or philanthropy to stay afloat.

But I believe if we can create models that are both impactful and financially sustainable, we really can change the world. Consumers are increasingly spending their money consciously, even during tough economic times. This growing shift creates an opportunity for social enterprises to thrive and amplify their positive impact because when social enterprises succeed, everyone benefits.

Credit: Clothing The Gaps

What do you believe needs to happen to reach that point?

I had the privilege of presenting at Retail Fest in Sydney, where I spoke about the social enterprise model of doing business. To my surprise, the session drew a small audience and for a brief moment, I thought I had the wrong time slot! This experience highlighted a significant gap in understanding among ecommerce and retail professionals about the financial and social value of social enterprises.

Social enterprises often lead with their impact and advocacy wins, like our Free The Flag petition that garnered 165,000 signatures or the campaigns we’re driving forward. However, traditional businesses tend to prioritise profitability metrics. While these numbers don’t define our purpose, they’re crucial for capturing attention and proving that a social enterprise can be both impactful and profitable.

Breaking the misconception that social enterprises are inherently financially weak is key to unlocking their potential. When this perception shifts, it paves the way for more purpose-driven businesses to thrive. It’s a message we’re deeply committed to sharing – because when social enterprises succeed, the ripple effects benefit everyone.

People and Planet First is a verification and a global collective that is accelerating the transition to an economy that puts people and the planet first. A collaborative approach with network partners across the globe is taken to verify enterprises in over 130 countries. Learn more on how to get People and Planet First verified and join the global #PeopleAndPlanetFirstWeek campaign on social media, where verified enterprises worldwide are being spotlighted.