EUROPEAN POLICY
ON SOCIAL
INNOVATION
Change Your Mind-set to Change
Society
Europese instrumenten voor sociale innovatie
en sociaal ondernemerschap in Vlaanderen
Sociale Innovatie Fabriek, Brussels, 31 March 2014
Filippo Addarii
CHANGE VIEW OF THE
WORLD TO CHANGE THE
WORLD
After lunch…. let’s start with an episode
of the TV show West Wing on Peters’
world-map:
https://www.youtube.com/watch?v=n8zB
C2dvERM
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SOCRATES (ATHENS 470 – 399 BC)
A model of radical search of truth:
• Oracle of Delphis defined him the wisest man on earth but his reply: “I know I
do not know”
• What’s truth? “It’s not solitary research but it’s like the job of the nurse helping
the mother to give birth”
• Accused of challenging the gods of the city and corrupt the youth he was
sentenced to death
• He accepted the death penalty because ‘if my fellow citizens do not accept
my criticism how foreigners would do it?’
Lessons:
• Our is a collective quest (not ideology) bounding us to our community
• The quest puts us in collision with status quo, and puts at risk our own
fortune
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CRISTOFORO COLOMBO (1450 – 1506)
An anti-hero and counter-intuitive story of innovation:
• He had a dream, ambition, knowledge, expertise and bravery (like Ashoka fellow)
• He lived in the time of transoceanic expeditions: demography, science, technology
booming - Europeans were looking for new lands, resources
• He offered his services to anybody, fooled his investors, lied on the returns (no gold),
became a fanatic religious for opportunism, and died in poverty & disgrace
• His business plan was wrong, but was lucky, ‘discovered Americas’ by accident and
changed the lives of 200m people: he built the basis for Europeans’ conquest of the
world, for the prosperity we still enjoy, but caused the death of 90% indigenous
population - diseases
Lessons:
• Innov is a collective & complex process with social impact despite the intentions
• Innovation is unpredictable – not individual goals & values predefine impact
• We are the explorers of the new word
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MICHAEL YOUNG (1915 - 2002)
Social innovation is institutional change:
• He left central government & party politics (experts’ top-down solutions) to
work within the community (Bethenal Green) engaging people directly
(ethnography)
• He believed in the creativity and entrepreneurship of people and their
communities to develop solutions for social progress (bottom-up & collective
solutions)
• Established 80 new institutions such as the Open University (distant learning
for 250’000 students), British Consumer Association, School of Social
Entrepreneurs (1997) and NHS Direct
Lessons:
• The success is to spin-off, become mainstream, and scale up by partnership
• Social innovation is not just making new product, services or methods, but
building the new institutions of market, democracy, and redefine the
social contract
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IS THE EU ON THE RIGHT
TRACK?
What EU needs:
What EU is doing:
1. Collective quest of truth
2. The explorers of the new
world
3. A new social contract to
rebalance the power
between markets, politics
and society
1. Led by rules and
procedures…
2. Sides with public &
nonprofit incumbents,
lobbyists and dated public
bodies eg EESC
3. Redefinition of the nonprofit sector, philanthropy
& ancillary welfare
services ie job inclusion of
marginal groups
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WHAT THE EU HAS DONE
Policy:
• Europe 2020 – Innovation Union Flagship Initiative (2010)
• Single Market - Social Entrepreneurship Initiative (2011)
• Social Investments (2013)
• EUSEF: label for Social Impact Investment Funds (2013)
• Public procurement directive: social impact as an optional criteria (2013)
• CSR directive: mandatory (to be approved by the Council)
• Social impact measurement (in discussion)
Public engagement:
• Social Innovation Europe , digital platform for networking and knowledge sharing (2011)
• GECES - expert group on social entrepreneurship (2012)
• Conference in Strasbourg - 2000 participants, the largest ever organised (Jan 2014)
• Conference by DG EMPL on 19 – 20 June 2014
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WHAT THE EU HAS DONE
Funding:
• Diogo Challenge: Social Innovation Prize Competition to tackle
unemployment (2012)
• Social Impact Accelerator: €52m fund of funds for social
entrepreneurship (2013)
• Collective Awareness Platform for Sustainability & Social
Innovation (2013)
• Programme for Social Innovation & Employment: €900m (2014 – 20)
• Cohesion Policy: socent & socinn included as priorities (2014 – 20)
• Horizon 2020: new programme for R&D - socent & socinn included as
dedicated call and horizontal priority (2014 – 20)
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WHAT THE EU GOT RIGHT
Important for the EU:
• Acknowledged social innovation and entrepreneurship to tackle the crisis
• Horizontal policy impacting every programme and DG
• A new generation of officials who are knowledgeable
Important today:
• Large amount of funding
• Progresses on CSR, public procurement, social impact investing
• Reputation amongst media and large public (although EU has got a pretty bad
reputation)
Important for the future:
• Prize challenges (funding results)
• Social Investments: a new framework for financing and delivering welfare
services (the basis for a review of the European social model)
• Impact on member states (at least some of them)
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WHERE & WHY EU HAS
FAILED
Lack of political leadership (blame the financial crisis?!?) & internal reform:
• Ancillary policy: neither visionary, nor systemic as changes in the rules of markets
• Policy hijacked by incumbents: public authorities, non-profit, lobbyists, statutory bodies
eg EESC
• Funding rules and procedures lack room for experimentation and risk-taking
• Missed partnership with corporate sector (real cash and transformative potential)
• Policy limited to EU instead of expand to the rest of Europe
• Lack of synergy with G8 task force for social impact investing
Independent causes:
• Cohesion policy not adopted by local authorities for lack expertise & vested interests
• Social impact measurement stuck (fight between legal status vs realized impact)
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BESIDES EU KEEP AN EYE
ON…
G8 task force on social impact investments (results delivered on 19 – 20 June 2014)
All new forms of finance eg crowd-funding, microfinance, electronic coins
Payment by results and government moving from funding products & services to funding
results eg Social Impact Bond
Corporate social innovation – multinational corporations moving beyond CSR
Traditional nonprofit organizations jumping in the filed eg Misericordia Lisboa & Social
Innovation Bank
Coops and mutuals investing in the sector eg Legacoop
Emerging sharing economy eg car-sharing, open-hardware, all forms of electronic barter
A rapidly changing market: robots replacing jobs… and jobs that can not be replaced
by robots
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SOCIAL IMPACT BOND IN
BELGIUM
First SIB in non Anglo-Saxon country
Professional insertion of migrants
Partners: Koisinvest.com, Duoforajob.be, Brussels Region (Dept in charge)
Targets: 320 migrants – 50% success rate (current rate 30%)
3 years - 500’000 total budget
Return 6% to investors if targets are met
Investors: wealthy individuals and foundations
Considerations:
Took a year to develop it (probono)
Too small to repay the cost of developing the financial product
Future larger SIBs under discussion
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To which tradition do you
belong: Rousseau, Lenin or
the Leopard?
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THANKS!
filippo.addarii@youngfoundation.org
Twitter: filippo.addarii @the_young_fdn