Feds Look to Social Innovation and Social Finance to Help Break Social Barriers to Prosperity

By Hina P. Ansari

A long-awaited report on social innovation and social finance was released last week as input for a national strategy being prepared by the federal government.

The 32-page study Inclusive Innovation: New ideas and New Partnerships for Stronger Communities was presented to the Government of Canada by the Social Innovation and Social Finance Strategy Co-Creation Steering Group.

The Steering Group is comprised of 17 persons (see Table 1) from diverse backgrounds including philanthropic, financial and community sectors and was appointed and convened by Jean-Yves Duclos, Minister of Families, Children and Social Development along with Patty Hajdu, Minister of Employment, Workforce Development and Labour.

The year-long study which commenced in June 2017 included “more than 50 in-person or virtual sessions and hundreds of online submissions” and involved 35 Indigenous groups. It outlines how social innovation and social finance can be used as essential tools which, per the recent press release by Employment and Social Development Canada, “could be incorporated into a comprehensive strategy to build more inclusive and prosperous communities, and in doing so, improve the lives of vulnerable Canadians and create a more inclusive middle class.”

Decoding “Social Innovation” and “Social Finance”

“Social innovation is a response to a social or environmental problem (including everything from a program or a service to different ways of structuring organizations) which, once adopted, results in better outcomes than existing approaches,” says Josh Bueckert, spokesperson for Employment and Social Development Canada, the lead federal agency on the social innovation file. “[It has] a transformative impact, delivering improvements across organizations, communities, regions, or systems.”

Combining that with social finance – monetary investments for social or environmental impact – this approach can be viewed as a game-changer when it comes to tackling social issues. The steering group identified six areas key to organizations working for the advancement of the underserved including: “their ability to increase skills and build capacity, their ability to access funding and capital, their market access to sell goods or provide services, the effects of policy and regulations, the benefits of knowledge sharing among social purpose organizations and public awareness and mobilization.”

A Different Strategy for a Different World

Allyson Hewitt, director of social entrepreneurship at MaRS and a member of the steering group, highlights the importance of social innovation as “a new way for us to tackle our complex social and environmental challenges. We often associate innovation with technology but this report outlines how social innovation is just as important.”

Organizations are hoping for positive changes in how they deliver programs. “Sector stakeholders note that they are facing new challenges and that the traditional donation and volunteer model that supports not-for-profit and charitable organizations is weakening,” Bueckert adds. “These same representatives cite social innovation and social finance as potential ways to address this weakness.”

Hewitt believes that interest in millennials will accelerate this change. “I anticipate that “purpose” will be at the center of many of our ventures,” she predicts, “and ‘financial sustainability’ will be at the center of how we approach our social purpose work.”

This new approach will also require policy makers to make changes. “We need to modernize our charity legislation and free up social entrepreneurs to tackle our complex challenges,” says Hewitt, “like homelessness or addictions. We need these social entrepreneurs to have access to funding, like traditional entrepreneurs do.”

Bueckert says he expects far-reaching impact on Canada’s social challenges. “Social innovation and social finance can be applied to the full range of social, environmental, and economic sustainability issues, including creating jobs for people with barriers to employment, developing new models of housing for those in need, upcycling materials that would otherwise be discarded to increase their value while keeping them out of landfills, and establishing additional innovative models to increase peer supports for seniors who are isolated.”

The report also includes 12 recommendations (see Table 2) on how to grow social innovation and social finance in Canada including various program and funding recommendations. The government is currently reviewing the study and looking to make an announcement on their final Social Innovation and Social Finance Strategy in Spring 2019.

To read Inclusive innovation: New ideas and New Partnerships for Stronger Communities please click here: https://www.canada.ca/en/employment-social-development/programs/social-innovation-social-finance/reports/recommendations-what-we-heard.html

To read the official press announcement by Employment and Social Development Canada please click here: https://www.canada.ca/en/employment-social-development/news/2018/08/government-of-canada-takes-important-step-towards-a-social-innovation-and-social-finance-strategy-to-address-canadas-most-persistent-social-issues.html

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