Social innovation has emerged from the margins to become a defining force in contemporary policy debates. As a novel approach to addressing complex problems in global health, social care, education, energy and environmental policy, social innovation has captured the imagination of stakeholders and communities at local, regional and national levels. This widespread uptake is reflected in the proliferation of public programmes that initiate, support and analyse social innovation across diverse policy arenas.
This quiet revolution represents more than incremental reform. Social innovation has catalysed a fundamental rethinking of innovation itself—one that opens up to society and thrives on interaction between diverse actors from civil society, business, politics and science. These stakeholders collaborate on the ideation, implementation and diffusion of new social practices and institutions, working from different sectoral perspectives with diverging objectives, yet often in profoundly co-creative ways. In this sense, social innovation emerges as a distinctive mode of social change and transformation, particularly vital when markets and politics fail to deliver solutions.
For nearly two decades, the European Union has been experimenting with embedding social innovation into its political DNA. This was never about apps or gadgets, but about reimagining welfare provision, building inclusive economies and tackling problems that neither market mechanisms nor state intervention could solve alone.
From Financial Crisis to Climate Emergency
The journey began in earnest with the 2006-2007 financial crisis. European leaders discovered that traditional innovation policy was insufficient to address the multiple, complex and interrelated global challenges confronting contemporary societies. The old political instruments and strategies proved too blunt, too narrow or too fragile for the task at hand.
The response transcended the sterile debate between austerity and spending. Instead, Europe embraced new approaches: co-creation, citizen involvement and public-private partnerships for the common good. This became the essence of social innovation—a recognition that twenty-first-century challenges demand fundamentally different tools and mindsets.
At the programmatic level of Europe’s research and innovation policy, this new perspective had been germinating since the 1990s. The EU research framework programmes substantially upgraded the social dimension relative to technology-oriented research and innovation.
Social innovation was first mainstreamed at the EU level through the EQUAL Community Initiative for inclusive employment, launched under Commission President Romano Prodi. Implemented within the European Social Fund (ESF), EQUAL placed strong emphasis on social innovation as a means to combat discrimination and inequalities in the labour market. Conceived as a laboratory for experimentation, it tested and disseminated innovative solutions, mainstreamed good practices, and promoted transnational cooperation. EQUAL’s legacy is widely recognised as a cornerstone of today’s EU strategies for social innovation.
The concept gained serious traction during José Manuel Barroso’s presidency, when his advisers acknowledged that traditional policies were failing to cope with economic and financial crises whilst meeting mounting social needs.
Social innovation has since become integral to European innovation policy, appearing and reappearing in different phases across the policy arena. Under Jean-Claude Juncker, the European Pillar of Social Rights (2017) positioned it as a lever for modernising welfare systems. Marianne Thyssen, the employment commissioner, went further, presenting social innovation as both ethical imperative and instrumental to Europe’s future.
Carlos Moedas, commissioner for research, science and innovation from 2014 to 2019, provided crucial momentum. He channelled resources into Horizon 2020 funding and declared that the EU should back social innovation not “because it’s trendy, but because it’s the future”. Social innovation became embedded in Europe 2020’s promise of “smart, sustainable, inclusive growth”, spawning a new generation of EU-funded projects that consolidated theoretical and empirical insights from predecessor initiatives such as SI-DRIVE (Social Innovation—Driving Force of Social Change) and TEPSIE (Theoretical, Empirical and Policy Foundations for Building Social Innovation in Europe).
The von der Leyen Commission has embedded social innovation deeper still. The European Green Deal, the Social Economy Action Plan and ESF+ regulation all accord it formal weight. Commissioner Nicolas Schmit has tied it to the “just transition”, making clear that innovation for the common good is no longer a side project but a pillar of the EU’s innovation model.
Building Infrastructure for Change
The institutional architecture supporting social innovation has expanded dramatically. The European Social Network highlights social innovation in its programme, whilst the European Social Fund+ (ESF+) supports social innovations through multiple measures at European and member-state levels. The new ESF Social Innovation+ Initiative encompasses EU-wide, multinational projects to develop, replicate and scale up innovative solutions.
The European Competence Centre for Social Innovation has been created not merely to organise transnational calls for proposals but to collect, assess, develop, validate and disseminate suitable tools and methods. It offers mutual learning, capacity building and networking for ESF managing authorities and other relevant stakeholders. National Competence Centres for Social Innovation have emerged in almost all member states, supporting managing authorities to programme and implement social innovation actions whilst providing capacity-building and networking measures for organisations on the ground.
From digital social innovation pilots to urban living labs, from impact bonds to European competitions, the landscape has undergone impressive development since 2010. Yet despite these advances, we remain at the beginning of a process that will enable the systematic development of social innovation. Europe’s social innovation story is far from complete—we have merely finished the prologue and glimpsed what social innovation could achieve in a fully developed and institutionalised innovation system that harnesses the distinct capabilities of technological and social innovation, along with their synergies.
Too often, social innovation has been framed as a substitute for, rather than a modernisation and strengthening of, the European social model. Impact measurement remains weak. Definitions shift from one directorate-general to another. Critics warn of technocratic capture: that what began as grassroots energy risks being tamed into bureaucracy.
A Fragile Consensus Under Threat
The divergence between institutions reveals underlying tensions. The 2024 ESF+ opinion treated social innovation as peripheral. Just a year later, the European Economic and Social Committee called it essential for resilience, democracy and governance transformation. The EU still hasn’t decided: is social innovation a necessity, aligned with all those efforts since 1992, or merely a luxury in a world dominated by technological imperatives?
The real danger now is that Europe’s fragile consensus on a comprehensive innovation approach may be unravelling. The 2025 Spring Package of the European Semester quietly shifted focus back to competitiveness and fiscal stability, with scant mention of social innovation. If austerity 2.0 returns, the hard-won gains of the past decade could vanish.
In many countries, promoting social innovation has already served as a catalyst for various actors to develop new ways of working, access new funding sources and leverage supporting infrastructures. It has driven a general debate about the future direction of innovation policy. The contours of a new innovation paradigm are emerging that adequately captures and interlinks the diversity of innovations in society, focusing beyond economic impact on their contribution to overcoming societal challenges.
This implies a transformed role for public policy and government in creating appropriate frameworks and support structures, the integration of resources by business and civil society, and supportive action by science and universities. Particularly in developing supportive ecosystems, social and technological innovations could be jointly shaped in their systemic context through the interaction of actors from different subsystems. Social learning processes could be carried out and national and local challenges addressed in fundamentally new ways.
One of the biggest challenges remains integrating social innovations into an overarching innovation policy and developing appropriate infrastructures and funding instruments. The ongoing European activities and the operationalisation of the Industry 5.0 concept offer new horizons to establish the social innovation paradigm in industrial innovation, furthermore orienting them towards societal challenges and needs.
This comprehensive understanding of innovation can become the foundation of a mission-oriented and transformative innovation policy that exploits the potential of social innovation whilst enhancing the innovation potential of society as a whole. The lesson of the last twenty years is clear: when crisis hits, social innovation rises. Recent experience has demonstrated countless approaches and successful initiatives that illustrate the strengths and potential of social innovation to cope with grand societal challenges and open new avenues for a sustainable future.
What Europe needs now is serious commitment: clearer definitions, stronger metrics, cross-sector coordination, appropriate infrastructures and policy programmes—and bold investment. Just as conditions to explore the potential of the natural sciences and make them usable for society were created through systematic innovation policy in the middle of the last century, at the beginning of the twenty-first century an equally great pioneering spirit is needed in the search for new social practices that enable us to build a better future.
In this context, the increasing importance of social innovation is both part of and a driver of a general debate about the future direction of innovation policy. In times of multiple and deepening crises affecting all areas of social life, the EU has become and continues to be a pioneer of a new, comprehensive innovation policy. This policy creates the economic and social conditions for the upcoming socio-ecological transformation processes.
If innovation policy reverts to the technological and economic orientation of the past, the price will be paid not just in Brussels but in the daily lives of Europeans. In the coming years, we will need the courage to continue on the path we have chosen and make it a priority on the political agenda.
Sofia Lai Amândio is Associate Researcher (PhD) at ISCTE, University Institute of Lisbon.
Jürgen Howaldt is Professor at TU Dortmund University and Director of its Social Reseach Center.
