A year in review: What happened in ANZ procurement during 2025?

15th December 2025,

By Jonathan Dutton FCIPS,

For procurement professionals across Australia and New Zealand, 2025 was a year of recalibration. After years of pandemic disruption, inflationary spikes, geopolitical turbulence and supply chain disturbances, the profession found itself at a crossroads.

The PASA Connect community, together with key global surveys from The Economist/SAP and The Hackett Group, revealed a profession under pressure to deliver more value with fewer resources, while adapting to new regulatory demands and technological shifts.

During the year, inflation cooled, household purchasing power improved and interest rates began to ease, but procurement leaders were far from complacent.

Cost management returned to the agenda, supply chain resilience remained a constant concern and the mandatory reporting of net zero emissions – from January 2025 – forced organisations to begin to embed sustainability into their contracting processes and inbound supply management.

From responsibility to the ‘Four S’s’

The year’s PASA narrative was framed by two guiding themes:

The legacy of 2024, “Responsible Procurement,” which reminded buyers of their seven core responsibilities: assuring supply, delivering value for money, managing risk in a volatile world, ensuring compliance, embedding ESG, seizing commercial opportunities and aligning with broader policy aims. The challenge was how to balance these often competing priorities in the face of growing stakeholder demands.

In 2025, the PASA theme evolved into efficiency, collaboration and transparency or “ECT” – three key challenges all procurement leaders face at every level.

The Four S’s offered a shorthand for the modern role of procurement teams, derived from the old ‘Five Rights’ which later became the ‘Seven Rights’.

Buyers are expected to serve the factory by supporting operational needs, support the corporate agenda through short‑term achievements, satisfy stakeholders by meeting quarterly and annual goals, and save the planet by advancing long‑term sustainability and delivering on ESG policies and modern slavery initiatives.

This framework captured the widening scope of procurement, stretching from tactical delivery to strategic influence.

The ANZ procurement headlines of 2025

The year was punctuated by a series of notable developments. PASA itself hosted 16 major events, over 50 PASA Connect roundtables and a suite of webinars and courses, underscoring the appetite for professional dialogue and its direct benefits.

Globally, tariffs introduced in the United States reverberated through supply chains, even though inflationary pressures eased in ANZ.

Artificial intelligence (AI) became ubiquitous, with generative AI (GenAI) pilots dominating procurement technology conversations. Supply chain security was reframed as cyber security, reflecting the growing threat of commercial cybercrime, particularly through the back door of our suppliers.

Regulatory reform advanced on both sides of the Tasman. In Australia, the Commonwealth Procurement Rules (CPRs) were upgraded, while in New Zealand the Ministry of Business, Innovation and Employment (MBIE) upgraded the New Zealand Government Procurement Rules and finally launched a new tendering platform to succeed GETS.

The appointment of an Australian Commonwealth Modern Slavery Commissioner for a five‑year term signalled that Modern Slavery Act rules will likely tighten – with, perhaps, penalties likely to follow, making compliance a more pressing issue. In New Zealand, both modern slavery and payment times legislation look imminent.

Professional standards also moved forward, with new standard benchmarks from both CIPS and WorldCC providing diagnostic rubrics for teams to measure maturity.

Procurement training expanded, especially from FY26 in July, and cost management re‑emerged as a strategic lever, supported by many research reports in 2025.

Procurement’s challenges

Against this backdrop, procurement leaders in the PASA Connect CPO Roundtable group identified their top issues for 2025. Generally, they sought to balance efficiency with resilience, build real visibility into supply chains and increase business confidence in procurement.

Supplier relationship management required realignment, as organisations moved gradually from transactional sourcing to deep category strategies.

‘Friend‑shoring’ emerged as a potential sourcing approach, while delivering broader value to the business remained a constant ambition.

Technology was both a promise and a puzzle. Leaders wrestled with how AI fit into procurement, how to extract more payback from eProcurement investments and how to adopt a balanced approach to responsible procurement.

Efficiency, collaboration and transparency were the new PASA watchwords: faster processes, stronger ties with stakeholders and suppliers, and better governance through ESG reporting then impact.

Insights from the key surveys

The Economist Impact and SAP survey revealed that geopolitical dynamics were the top organisational risk, cited by two‑thirds of respondents. Sustainability was the leading strategic priority for the next 12 to 18 months, while GenAI was the top technology trend to pilot. Skills gaps loomed large, with AI proficiency and sustainability skills ranked highest.

The Hackett Group’s study added further detail. Procurement workloads were predicted to increase by nearly 10 percent, but staffing and budgets rose only marginally, creating a productivity and efficiency gap. Technology spend was expected to grow by 5.6 percent, reflecting hopes that digital tools could close the gap.

The top priorities for 2025 were clear: cost reduction, supply continuity, operating model transformation, inflation management, digital transformation, acting as a strategic advisor, embedding sustainability, improving analytics, enhancing supplier relationships and strengthening third‑party risk management. Other studies in the year seemed to echo these key findings.

Technology and AI

Digitalisation was the number one strategic priority across ANZ, APAC and global respondents.

AI strategy, spend analytics and sourcing automation were the main drivers, yet adoption was fraught with concerns: data quality, privacy, lack of skills and intellectual property leakage. Gartner research underscored the frustration, finding that procurement only secured exactly the technology it wanted 17 percent of the time.

Despite these challenges, the transformational potential of digital procurement and AI was undeniable. Surveys suggested that automation, GenAI and real‑time data visibility would reshape procurement over the next five years.

The changing profile of procurement skills, from traditional negotiation to digital proficiency and ethical AI-use was already evident, yet bizarrely, if understandably, some procurement teams have been restricted in their use of GenAI by nervous CIOs – the demands range from outright banning of GenAI, only using Co-Pilot, no uploading or do-your-own-thing.

The development of firm AI ‘guardrails’ is underway in most organisations – some faster than others, it feels. The thirst for GenAI and the “bell-curve” distribution of capability within teams ranges from experts to naysayers, but the “Eight Ways Procurement People are using GenAI” now feels universal in 2025 amongst early adopters.

ESG and social procurement

ESG remained central to procurement policy and practice. Firstly, mandatory obligations included compliance with the Modern Slavery Act and Payment Times Reporting. Secondly, almost-obligatory initiatives encompassed Indigenous procurement, net zero targets and gender equality. Thirdly, optional but increasingly popular, measures included supplier diversity, local buying and social enterprise engagement.

During the year, the Federal Government in Canberra raised its Indigenous spend target up to four percent by 2030 and committed to more measures to support Indigenous-owned businesses.

The sheer breadth of ESG objectives creates “a dizzying array of priorities” as The Economist previously described it. The stakeholder thirst for impact suggests procurement leaders will have to find the confidence to internally agree to a top few priorities in their most relevant focus areas – few can attempt such a wide range of ESG goals.

Looking ahead

As 2026 approaches, procurement leaders anticipate sharper enforcement of modern slavery compliance and possibly Payment Times. Further federal procurement requirements are also likely – and often set trends for the states and others to follow.

The ramp‑up of procurement activity for the Brisbane Olympics in 2032 is expected to step up in year two of the new government in Queensland, and some vacuum can perhaps be anticipated in Brisbane CBD to deliver BAU, as the Olympics increasingly drags resources away from the everyday. Similar trends may accompany Defence spending, in Adelaide, particularly.

PASA’s new theme for 2026 is set to be fully revealed in January as normal, but it will be built around the idea of adaptability.

How can procurement leaders and managers adapt procurement approaches to cater to the world of change we face both locally and globally?

The notion of IQ, EQ and AQ captures the blend of core process driven intelligence, emotional intelligence and adaptability required to navigate the future.

The lessons of 2025 are clear. Procurement is no longer a back‑office function focused on cost savings, it is a strategic discipline balancing efficiency and resilience, embedding ESG and compliance as well as managing geopolitical risk, harnessing technology to enhance outcomes and driving structural cost changes.

The profession’s workload is growing faster than its resources, making digital adoption essential.

Conclusion

Procurement in Australia and New Zealand during 2025 was defined by transition. Inflation cooled, but cost remained central. Net zero scope 3 and modern slavery compliance gained momentum. AI shifted from hype to pilot projects, even daily use, while cyber security reframed supply chain risk. Professional standards advanced and procurement’s workload grew faster than its resources, underscoring the need for smarter technology adoption.

The year underscored procurement’s growing influence in shaping economic resilience, social equity and environmental sustainability. The supply side carries more demands than ever, it feels.

As 2026 looms, procurement leaders must blend IQ, EQ and AQ to deliver value in a volatile world. If 2025 was about recalibration, 2026 will be about adaptability.

Jonathan Dutton FCIPS is the Chief Content Creator for PASA