Session 5: Building Innovative Ecosystems: lessons learnt from Hong Kong

Building Innovative Ecosystems: lessons learnt from Hong Kong

Hong Kong’s history of organisations that have a social purpose stem back to the 1980s and the development of social economy projects.  In 2020, there were estimated to be between 2936 and 5740 SEs operating in Hong Kong.  The majority of these are small, with less than 10 employees, relatively young, being in operation for four years or less, and focused on creating impacts in health, smart cities and employment (British Council 2020). 

In terms of policy, the HKSAR Government often provides support in the forms of grants or funding.  There are three main funds that the government offers support through, the Enhancing Employment of People with Disabilities through Small Enterprises Project, Enhancing Self-Reliance Through District Partnership Programme and the Social Innovation and Entrepreneurship Development Fund.  The government also runs a Social Enterprises Partnership Programme (SEPP), with a Mentorship Scheme (British Council 2020). 

Aside from the HKSAR Government, there are various stakeholders who influence the operating environment for social ventures.  These include:

• Enablers and capacity builders (including incubators and accelerators): provide the critical support structure for SEs, offering guidance and capacity building as well as financial resources. 
• Investors and financiers: seek to create positive social and environmental impact through finance, by investing in SE and, at the same time, generating financial gain.
• Business support organisations: include institutions and individuals looking to create positive social and environmental impact by investing in SEs.
• Policymakers
• Higher education institutions: higher education institutions nurture and foster the development of young social entrepreneurs, often through competitions and seed funding to encourage innovation.

 

 

The government’s policies to foster social innovation have led to the creation of a more innovative and inclusive social entrepreneurship environment (Chan et al. ).  Barriers of cash flow, staff recruitment and difficulties in obtaining grant funding, however, remain. 

 

Gaps in Hong Kong’s social innovation ecosystem

While developing, several issues have been identified with Hong Kong’s ecosystem for social innovation that impact its overall sustainability and effectiveness (Alto & Wong 2013).  More needs to be done in facilitating cross sector collaboration as the knowledge sharing and collaboration culture within Hong Kong is underdeveloped.  While there has been an increase in funding, particularly with the introduction of the government’s Social Innovation and Entrepreneurship Development fund, these often favour or encourage ventures to focus on addressing (un)employment.  This has stymied efforts to experiment with alternative forms of social innovation to meet social needs.  The funding system also continues to favour conventional non-profits thanks to the long-standing partnership between the state and these actors.  This reinforces difficulties in achieving cross-sector collaborations for project development (Chan, Chui & Chandra 2021).  There is also the need for accountability and transparency measures to allow for informed decisions and performance as well as a need for stronger leadership and development  (Alto & Wong 2013). 

 

Building the ecosystem

The Centre for Civil Society and Governance’s social incubators are actively contributing to the development of a vibrant social entrepreneurial ecosystem in Hong Kong.  Incubators are able to act as a catalyst for building sustainable entrepreneurial ecosystems through their role in encouraging and supporting the creation of programmes that increase the awareness of entrepreneurial actions, encourage the flow of new entrepreneurs into local economies and support and develop established ventures (Theodaraki et al. 2018). 

The Centre’s incubation projects differ from others in Hong Kong as they do not require applicants to have a strong business background.  Rather, the Centre’s financial model is able to provide support for individuals who have innovative ideas but lack the necessary capacity or capability to access the more conventional incubation schemes or grants.  Under the Centre’s incubation programmes, the ventures are selected based on their social impact and self-sustaining model, rather than profitability.  The Centre, being an academic unit of The University of Hong Kong, also plays a strong role in the incubation projects.  It allows for a strong network of sustainability and business orientated academics, specialists and practitioners to be made available to the ventures as well as provides the opportunities for continued research and development.  The University being a for-benefit institution facilitates the overarching framing of the project’s social objectives, which often creates the necessary public and political attention to the problems or challenges that the ventures attempt to tackle.  In return, thought leadership is developed among the University and its participants, so they will further contribute to developing the wider sustainability ecosystem in Hong Kong. 

The Centre has changed the social innovation and incubation landscape of Hong Kong by introducing new actors and institutions into the landscape.  More diverse institutional forms were introduced into the social entrepreneurship arena, opening up more opportunities for aspiring social entrepreneurs.  Equally, in the arena of rural sustainability, the Centre’s projects represent a new player, one which possesses a sustainability mind set and belief in “innovation for sustainability”.  As a result, likeminded people have been able to connect and encouraged.

 

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