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From S3 to S4+: smart specialisation strategies for sustainable and inclusive growth

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The European Green Deal with its mission-oriented approach, Horizon Europe’s five missions for Europe, the COVID-19 crisis, and the policy alignment with the United Nations (UN) Sustainable Development Goals (SDGs) imply a new directionality of sustainability and inclusiveness in European innovation policies. Mikel Landabaso Álvarez, director for 'Growth and Innovation' and director of the Seville site of the EC Joint Research Centre, points out that 'deepening Smart Specialisation [in the next programming period 2021-2027] also means encompassing the sustainability dimension, which is of key importance to deliver on the agenda of the European Commission and achieve competitive sustainability'. 

The Joint Research Centre (JRC) has recently published a report written by Philip McCann and Luc Soete titled 'Place-Based Innovation for Sustainability', which is the outcome of the expert group 'linking smart specialisation and mission-oriented policy for sustainable development'. The report highlights that the regional policy focus must be on transformative changes. Innovation must not blindly follow competitiveness logic but must respond to broader regional societal challenges and be an 'intermediate step towards the longer-term goals of fostering sustainability and inclusiveness' (McCann & Soete).

As a result, the report proposes an evolution of the policy logic from S3 to smart specialisation strategies for sustainable and inclusive growth (S4+). S4+ means reinforcing the S3 mission-oriented policy approach with non-neutrality, direction, and system approach to engage regions in European initiatives dealing with missions. S4+ implies a policy shift in the way regions may consider setting policy priorities to push technological innovation and their responses to regional societal challenges. Some European regions such as Northern Netherlands, a partner in BEYOND EDP, have already started to design their smart specialisation around missions and societal challenges

From the report, McCann and Soete propose the following intervention logic table to support the evolution of smart specialisation strategy (S3) to embrace smart specialisation strategies for sustainable and inclusive growth (S4+): 

Intervention logicS3S4+

SWOT analysis

  • Appraise endowments in assets
  • Assess innovation potential in a territory
  • Appraise entrepreneurial base and dynamics
  • Identify international networks and value chains

Strengthen S3, and …

S4: Position the SWOT analysis in the ecological and digital transitions of the energy, manufacturing, agri-food, housing, and mobility systems


  • Management structure in place
  • Participation of stakeholders in quadruple helix Institutional and human resources capacity

Strengthen S3, and …

S4: Role of the state goes beyond being facilitator and catalyst to co-create system transformation. This requires management reforms and capacity building to work cross-domains, cross-departments, cross-sectors and cross-disciplines.


  • Shared vision on present and future innovation challenges
  • Strategy medium-term

Strengthen S3, and …

S4: Vision goes beyond the R&I system. Could be a societal vision: 'Which is the future we want – here?' or an industrial vision: 'promising areas for the future'. The vision should be linked to overall target(s) set in time (medium-term) which is understandable, measurable, ambitious but realistic.


  • Revision of previous priorities
  • Identify areas of competitive advantage
  • Verify critical mass of budget for achieving each priority

Strengthen S3, and …

S4: If the priorities are aligned or in the same overall direction as the overall EU-level investments (and regulatory changes), then the potential of reaching critical mass and of crowding-in of private investment and of EU funds increases.


  • Broad definition of innovation
  • Balance between focused and horizontal measures
  • Upgrading existing industry using KETs and digital
  • Experimentation in pilot actions
  • Innovation ecosystems
  • International collaboration search for value chains

Strengthen S3, and …

S4: The Implementation is driven by innovation but mobilises in synergy with other policy areas and investments, such as infrastructure, skills, etc. The scope is broader with systemic innovation and industrial transitions.

Programmes create portfolio of projects and focus on development, testing or deployment of innovative solutions. Place-based experimentation and testbeds of local or foreign innovations are linked to user driven innovation, economies of scope and public procurement. The strategy for positioning in value chains is proactive in new value chains emerging from the transitions and they create a local articulation of EU alliances.

S4: The local framework conditions to innovation are now also European. When local entrepreneurs detect barriers or resistance to innovation for sustainability this can be channelled in 'Green Deals' to the national and EU policy level.

S4: Cooperation and mutual learning with other actors of change is facilitated by regional thematic network but the new network externalities are broader emerging from the reorientation of EU network of actors ( European technological platforms, European partnerships, industrial alliances, EIT Knowledge and Innovation

Monitor and Evaluate 

  • Indicators with targets and baseline
  • Mechanism for data collection and analysis
  • Information used for updating the strategy

Strengthen S3, and …

S4: The monitoring and evaluation goes beyond the R&I system; indicators and targets correspond to the granularity of the vision in the regional or urban strategy. A continuous policy learning dynamism is introduced. Particular attention is given to early detection of signs of trade-offs between sustainable/smart/inclusiveness.

Read online the JRC report on Place-Based Innovation for Sustainability

Image credit: Photo by Polina Zimmerman from Pexels
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