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Our country is blessed with an abundance of natural resources. But we can no longer prosper only from the output that comes from our natural resources. We must also prosper from the energy and ingenuity that comes from our people. That's how Canada's economy will outperform the economies of the rest of the world. In the coming months, as we put your ideas into action, let's work together to foster innovation for a better Canada. Canada has thrived over the past half century. But our country won't automatically do the same over the next half, especially if we stay the course.

That's because Canada and other advanced economies face new pressures. Four major challenges define Canada's future as our country becomes more open and interconnected within the global community. The flip side of these challenges are opportunities that will make innovation necessary to create and secure good-quality jobs for Canadians. The global economy is growing slowly. In the past, Canada relied on increased trade and high commodity prices to boost its economy during periods of slow growth.

We also relied on more people to join the workforce. Over the past decade, Canada and other advanced economies have lowered interest rates and tax rates in a prolonged effort to stimulate growth.

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But those policies have not been sufficient to ensure the strength of the middle class. Meanwhile, Canada will continue to have fewer working-age people as our population ages, resulting in lower growth potential. The world has entered a new industrial age. Technology is digitizing and automating every aspect of our lives—and it's happening much faster than anyone ever imagined. Technology is challenging every industry and every worker.

New jobs and companies that never existed before are being created as others are being phased out. As the Internet and other technologies make communications instant, constant and affordable to people in every corner of the globe, they are reducing the competitive advantages of Canadians and citizens of other advanced economies.


At the same time, they are empowering people in emerging economies. To respond to the pace of technological change, Canadians need to stay as open and flexible as possible.

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We will need to adopt new technologies and learn the skills necessary to prepare for the jobs of the future. The competitive pressures of the global innovation economy are more intense than ever. Developed and developing economies alike are putting in place aggressive strategies to position their economies for competitive advantage in the development of the next great technologies, products and services. This defining issue of our generation is reshaping how countries around the world meet their energy needs and how they think about growth.

Climate change will influence how Canada and other countries manage natural resources in a world of both rising energy consumption and rising climatic risk. Many countries are transitioning to a low-carbon economy based on "clean technologies" that promote energy efficiency, reduce pollution and produce cleaner air and water. This shift to clean growth has the potential to create jobs as well as new markets. Focus on international collaboration, domestic frameworks, and new investments in clean energy and clean technologies.

Innovation to drive growth, improve lives of Canadians, and create jobs economy-wide. These days, the merger of globalization and technology means companies can source their talent, goods and services from anywhere in the world. And when companies look to invest, they are not always looking for the lowest-cost jurisdictions.

Instead, many companies seek the most innovative economies, with the most creative and entrepreneurial people who can turn ideas into solutions. That's why developed and developing countries alike are investing in developing the skills of their people to drive economic growth through innovation. And that's why now, more than ever, we need Canada to be at its absolute best. Now is the time for us to invest more in our people and build on our strengths to turn ideas into action.

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The Innovation Agenda is a plan to encourage activities that lead to better jobs for the middle class—and those working hard to join it. It's a plan to make Canadians better off in the future through the development of better skills training, better research, better opportunities and better living standards. Countries around the world recognize the importance of innovation in unlocking the hidden potential to grow their economies. They are acting quickly and making significant investments to support innovation.

Canada is competing in a global innovation race. We must think big, aim high and act boldly in this race to the top. Over the past six months of public consultations, more than , Canadians have shared their insights on how to strengthen Canada's innovation economy. Footnote 10 BSC is one of a number of measures the UK government has instituted to stimulate social finance, including seed funding for social finance funds, the establishment of capacity-building intermediaries, and the creation of the Social Investment Tax Relief. The institutions of the European Union have also made social innovation and social finance a priority.

In , South Korea launched a task force and created a permanent body to advise its government on policies to stimulate social innovation across ministries, with a focus on citizen engagement and the use of new technology.

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The national government has also announced the creation of social finance fund, capitalized with billion South Korean won sourced from dormant bank accounts, following the British experience. Credit enhancement measures to further accelerate the growth of social finance have also been proposed. While these laws respond to the circumstances and terminology of each jurisdiction, they have each recognized social purpose organizations as key drivers of social innovation and inclusive growth.

The Strategy is an opportunity for Canada to take its place as a leader in social innovation. It is also an opportunity for Canada to demonstrate leadership and meet its commitments under the United Nations Sustainable Development Agenda, a global framework of action encompassing 17 goals aimed at eradicating poverty and building a healthy planet. We met with Indigenous groups and individuals from across Canada to seek their perspectives on the development of the Strategy.

Throughout these conversations, we learned of successful examples of social innovation in Indigenous communities. We were also told the language of social innovation and social finance does not always resonate with the approaches that are used in communities. Practitioners identified a need to adapt the language of social innovation and social finance to Indigenous cultural perspectives, working with communities at their own pace. We heard that certain aspects of social innovation and social finance, notably, the potential for an increased role for private and philanthropic capital, pose risks for Indigenous communities.

Indigenous participants asserted that Indigenous communities must be engaged in the design of and benefit from measures resulting from this Strategy. This is needed particularly in the areas of building capacity and skills, funding and capital, and knowledge sharing and mobilization. As well, the Government should commit to engaging Indigenous communities and organizations in supporting and partnering in Indigenous-led processes on social innovation and social finance, at a pace determined by them.

This report lays out recommendations to equip communities with the tools and knowledge they need to achieve better social, economic and environmental outcomes. These recommendations were informed by a large-scale consultation process undertaken in the fall of , which involved more than 60 in-person engagement sessions, two online processes, and outreach to over 15, Canadians and more than expert stakeholders, as well as an analysis of the activities currently under way through the support of municipal, provincial and territorial governments.

The way in which these recommendations are implemented will be as important as their content. They are intended to be acted on together to create a cohesive set of supports for communities. Social innovation and social finance are powerful tools for advancing diversity and inclusion. To ensure this potential is fully realized, those with lived experience of poverty, women, official language minority communities, immigrants, refugees, visible minorities, persons with disabilities, seniors, and youth, among other groups, need to be actively involved in the implementation.

It is also imperative that the Strategy entails a whole-of-government response that builds on and reinforces existing social innovation and social finance ecosystems across Canada. Women are the driving force behind many of the sectors and movements leading social innovation and social finance in Canada. Footnote One recent study highlighted how women play an active role in the creation and expansion of social purpose organizations that generate revenue, which is not always the case in the private sector. A participant in the study noted how "in choosing to become an entrepreneur, there is a question of values Some of the women working in these sectors still experience severe gender wage gaps and face broader challenges related to the value that society assigns to their work.

A more inclusive vision of innovation would do much to alleviate these inequities. Our vision is for a better future for Canada, where healthy and sustainable communities thrive; where individuals, especially those in vulnerable circumstances, have access to good jobs, and to safe, affordable housing; a future characterized by reconciliation with Indigenous peoples, dynamic official language minority communities, vibrant diversity, and social and economic inclusion. It has been a privilege to connect with innovators from all thirteen provinces and territories who are working hard to realize this future.

These individuals and organizations have already achieved much under considerable constraints. As you read the many examples of social innovation found throughout this report, we urge you to imagine what more could be achieved with the federal government taking its place as a decisive and supportive partner.

The concepts of social innovation and social finance will be new to many. For others, they are new names for old approaches. Far from being abstract, however, the terms refer to tangible and measurable activities that improve social and environmental outcomes — whether it is through services touching the lives of people in vulnerable situations, capital being invested in community projects, or goods being sustainably sold and bought.

We believe these terms yield important insights on challenges and opportunities facing Canada, just as words such as "sustainability" and "reconciliation" did when they were first introduced. Social innovation refers to 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. Social innovations have a transformative impact, delivering improvements across organizations, communities, regions, or systems.

Entrepreneurship and Sustainability as Key Elements for Innovation: A Brazilian Dilemma

Canadians understand the value of commercial and technological innovations and their role in driving productivity improvements in the economy. Social innovation is a similar concept in that it denotes the application of new ideas, methods and practices which create social, rather than strictly commercial value. Social innovation ranges from new ways of designing community services to different methods for organizations to work together, and everything in between.

Figure 8 illustrates how social innovation comes in different shapes and sizes. Social innovation is about more than service improvement. For a new program, a redesigned service, or a new partnership between organizations to be considered social innovation, it must have a transformative impact for the organization, community or region that adopts it. In this way, social innovation has the potential to disrupt entire systems for the better. Social innovation matters because it leads to measurable progress on the complex social and environmental challenges facing communities.

Just as we do with technological innovation, we should ensure that the right conditions are in place to promote social innovation in communities. The Winnipeg Boldness Project is a research and development project aiming to improve early childhood development outcomes in the Point Douglas neighbourhood of Winnipeg.

By using a social innovation tool called a social lab, Winnipeg Boldness is working to create systems change by bringing together community leaders, businesses, and residents to co-create solutions that are then tested with the help of neighbourhood families. The project seeks out opportunities for replication and scaling of successful ideas in order to permanently embed these solutions in the community and effect large scale change.

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It supports pilot projects to test innovative models of health care delivery that address complex social challenges. Social finance refers to investments intended to create a measurable social or environmental impact as well as to generate financial returns. Social finance differs from responsible investing in that those making and receiving social finance investments intend to create tangible social and environmental impacts through their activities.

Figure 11 illustrates the relationship between different forms of investment, including social finance, impact investing and responsible investing.