Good governance: principles and challenges Good governance: principles and challenges

Governance arrangements can foster or frustrate the implementation of S3, which is why national and regional authorities should reflect and strive to integrate principles of good governance. In fact, many aspects of implementation, in particular the selection of projects for public funding, a continuous entrepreneurial process of discovery and monitoring are highly influenced by governance arrangements. Using the term governance recognises that, as in other policy areas, the implementation of S3 is more effective and fair when executive power is shared with innovation actors, networks and indeed civil society more widely. However, we should recognise that each governance setting is unique and therefore, there is no such thing as a “governance template” that can be universally applied to every regional context regardless of the circumstances of time and place.

Download the "Good governance" pdf file

 

How to set up sound governance structures?

Challenge

Where the governance and funding functions are integrated within the same government department there is a much greater risk that the S3 project selection process will be subjected to political pressures from within or captured by dominant interest groups from without. The project selection process needs to be - and also needs to be seen to be - transparent, fair and robust.

Response

To retain the trust and credibility of regional stakeholders, the S3 governance and funding systems need to be separated and rendered accountable to different departments. Moreover, the S3 implementation needs to be effective as well as accountable – it must not be forgotten, in other words, that good governance is a means to an end and not an end in itself.

The Welsh Government in the UK has gone to great lengths to ensure a clear and credible division of labour in the governance and funding of its S3. The Department for Economy, Science and Transport is responsible for managing the design and delivery of S3 projects and, to ensure this process is transparent, inclusive and robust, the department created a wholly new Innovation Advisory Council for Wales in 2014, composed of senior representatives from the “Triple Helix” of government, business and higher education. One of the key roles of the Council is to provide independent oversight of the implementation of S3 in Wales. This governance function is wholly separate from the funding function, located in the Wales European Funding Office, which reports to the Finance Minister. Although clarity and transparency are assured in such a division of labour, the fact remains that this arrangement can also create coordination challenges and institutional tensions and these problems need to be openly acknowledged if they are to be properly addressed.

More information

See the webpage of the Innovation Advisory Council for Wales (in English)

Keywords

S3 governance, communication, public sector role

Challenge

A common vision is necessary to pursue ambitious long-term objectives and avoid vested interests prevailing when priorities are chosen and revised, or when project selection criteria are defined.

Response

A critical factor for the sustainability of S3 is the capacity to put in place an effective feedback mechanism between the EDP process and the regional vision, and to foster the quality of entrepreneurial discoveries which will subsequently affect potential revisiting about the vision itself.

Lapland (FI) is the northernmost region as well as one of the most sparsely populated in Europe. Due to its specific geographical characteristics, Lapland has explicitly based its S3 process on the elaboration of a joint vision of how to build on its strengths as an arctic region.

According to the vision of Lapland’s Arctic Specialisation Programme 2030, Lapland would enjoy a leading position in exploiting and commercialising arctic natural resources and conditions. One of the Lapland VISION 2030's objectives is to "offer its inhabitants an original, attractive place for living", embracing a wider concept of territorial development than the one usually found in industrial policy. The S3 vision for Lapland aims to promote economic regeneration and to create an original, attractive place for living by linking smart growth with sustainable (economic, ecological and social) development, putting in place the aforementioned effective feedback mechanism between the EDP and the regional vision.

The S3 vision is the result of a regional governance model coordinated by the Regional Council of Lapland and built on partnership and participation. The Regional Council of Lapland has implemented a model for regional governance to enhance smart growth and sustain the balance in sustainable development. The model emphasises the importance of a bottom‐up approach by actively involving all the 21 municipalities of Lapland, as well as industry, educational institutions, development agencies, and research organisations. It also promotes a partnership between the regional and national level as the Regional Council takes a strategic lead, but in collaboration with other regional stakeholders and national level governmental institutions.

More information

See the Lapland S3 strategy “Lapland’s Arctic Specialisation Programme” (in English)

Keywords

S3 governance, vision, entrepreneurial discovery process, public sector role

Challenge

An S3 benefits from integrated approaches that target the many different areas in which a sector needs support. This means public authorities needs to avoid a silo-type approach to policy, where each government department delivers its own strategy without coordinating with others.

Response

In order to prevent a silo type approach, a two-vector response is envisaged by Navarra. The first entails a vertical focus on specific clusters, as recommended by the S3 methodology. Purely horizontal approaches to R&D or skills provision, for example, hinder the design of integrated approaches, because it is impossible to know in advance which domains or sectors will use these instruments and therefore to plan a coordinated delivery. The second is a holistic approach to sectoral development, which goes beyond narrow concerns with science and technology or infrastructure and seeks to understand their multiple and inter-connected needs.

The S3 of Navarra in Spain is an example of how integration can be achieved, as illustrated in the Figure. The sectors chosen for support are identified in the top part of the diagram, whereas the roots list the seven key factors that affect their overall competitiveness. Despite some criticism that the choice of priorities was not sufficiently restrictive, the desire to integrate all core areas of policy action is likely to generate important synergies between different government departments and between operational programmes.

 
 

 

This integration was also achieved by the existence of an executive agency (Fundacion Moderna) that was responsible for the design and development of a new economic development plan for Navarra (Plan Moderna) as well its operational deployment and monitoring. After recent regional elections, Fundación Moderna team was integrated in SODENA, a government agency promoting financial instruments (venture capital, seed capital, etc.) to boost innovative companies. The new government expanded SODENA's former mission to accommodate the S3 (built on Plan Moderna) with a threefold objective:

- Introduce rationality and coherence bringing together the existing public agencies managing innovation programmes;

- Empower public and private stakeholders of the region in the S3 governance system;

- Improve coordination of the agency with the different government departments involved in its implementation.

More information

See the webpage of the Fundacion SODENA (in Spanish and in English)

Keywords

S3 governance, innovation agencies, priorities, public sector role

How to establish suitable governance in different territorial contexts?

Challenge

Territorial governance arrangements need to combine stability with flexibility to capture the twin benefits of continuity and novelty. This means that governance systems will need to be responsive to two challenges: 

- The ever changing relationships between national and sub-national levels;

- The emergence of new institutional actors sectorally or territorially defined.

Response

Romania has a national S3 developed by the Ministry for Education and Scientific Research, which is also responsible for its implementation, monitoring and evaluation. The priority areas were selected through a consultation process, but the strategy remains limited in its weak territorial focus, since it does not reflect and establish areas of competitive advantage in each of Romania's eight regions. At the same time, six Regional Development Agencies (RDAs) independently elaborated regional S3, and two were submitted to the S3 Platform's peer review process (RDAs are NGOs responsible for regional development and also intermediary bodies for the Regional Operational Programme). These regional S3 were formally endorsed by the Regional Development Councils which are governance bodies that include all the elected presidents of county councils in the region. Yet, the status of the strategies is unclear, since the regional level in Romania does not have formal competencies or administrative responsibilities, and therefore neither the financial resources for implementation. In Romania, there is an urgent need for more complementary action between national and sub-national levels.

In order to address the issue of sub-national priorities, the Romanian government has proposed a solution that will involve external expertise and an active role for RDAs in shaping planned investments in R&I. The RDAs will develop Regional Concept Notes based on a common methodology elaborated by the Managing Authority of the Regional OP. These documents will reflect the priorities selected by the regional S3, and in those regions without a strategy, they will effectively be set, taking care to follow a process of entrepreneurial discovery. These notes will give recommendations on the location, economic sectors and activities that could benefit from ERDF support. Whereas the focus will be on technology transfer and uptake by SMEs, other areas of the S3 policy mix can be considered, which seems essential to adopt a broad perspective on innovation as promoted by smart specialisation. The RDAs are to be given responsibility for consulting actors and for elaborating concept notes which will be endorsed by Regional Innovation Consortiums composed of stakeholders. Importantly, the regional approaches will be coordinated at national level and synergies with other instruments will be considered.

More information

Regional Operational Programme 2014-2020, Managing Authority website (in Romanian)

Keywords

S3 governance, multilevel governance, innovation agencies, public sector role

Challenge

The governance system of innovative regions would benefit from the involvement of a variety of organisations and a constant interaction among them, guaranteeing at the same time a clear separation of tasks and roles among organisations. In the specific context of smart specialisation, governance mechanisms should be designed to connect the regional government in a stable but flexible way with those stakeholders able to make a contribution to the selected priority domains.

Response

In order to achieve a better coordination of funds, transparency of processes, communication and evaluation, the S3 governance structure elaborated in Friuli Venezia Giulia (IT) clearly defines the roles and functions of the different bodies involved:

  • The regional administration provides political direction and ensures the management of the S3 by running the Steering Team and the Technical Secretariat. The Steering Team coordinates the S3 process and provides input to other departments responsible for complementary policies.

  • The Strategic Committee is the connecting body between the regional administration and stakeholders and provides input in the implementation phases of the strategy and its revision. It is composed of the coordinators of the S3 Working Groups (see next point) as well as the representatives of economic associations and the Regional Coordination of Research Organisations, representing the productive fabric and the regional scientific system respectively.

  • The S3 Working Groups are instrumental for the implementation and revision of the strategy and refer to the S3 priority areas as well as specific themes. They are open to representatives of the whole regional innovation system.

  • The General Assembly of S3 stakeholders allows the community of regional innovators to meet and discuss how the strategy is developing. Both the Regional Government Board and the Steering Team participate and animate the General Assembly, thus ensuring a connection between the political leadership and the regional community.

                                                      Source: S3 strategy (own elaboration)

This case provides a clear conceptual representation of the S3 governance structure put in place to implement the strategy. Nevertheless, it could benefit from a stronger presence of delivery organisations overseen by the government but with some degree of independence, in order to ensure more stability, independence from political change, and engagement of a larger number of potentially interested actors.

More information

See the Friuli Venezia Giulia S3 webpage (in Italian)

Keywords

S3 governance, multilevel governance, entrepreneurial discovery process, public sector role

How to manage the emergence of new territorial actors?

Challenge

The integrated nature of S3 requires cooperation and coordination among competences that are usually distributed across many institutional actors sectorally or territorially based. S3 implementation can be supported “on the ground” by a coherent distribution of responsibilities between different spatial levels of government (local, regional, national and European). However, this shift can raise significant challenges in terms of multilevel governance.

Response

A good example of the challenge to integrate new S3 institutional actors in existing regional S3 comes from the Basque Country (ES), where the City of Bilbao aims to design its own strategy in a process that is separate from the official S3 of the Basque Government. These two processes need to be synchronised otherwise territorial rivalry will impair them both. However, Bilbao may be the bellwether of a new trend towards urban development-led innovation policies, where cities become de facto “living labs” to test the feasibility of new technologies and novel ways of living and working.

The emergence of sub-regional S3 initiatives in Spain is not limited to urban settings but has also occurred in rural contexts, where a number of LEADER Local Action Groups (LAGs), such as in the regions of Extremadura, Castilla-La Mancha, Andalusia, Catalonia, have started to integrate elements of smart specialisation into existing rural development practice, so as to make it more knowledge-based and innovation-oriented. Among them, the Smart LEADER strategy of TAGUS in Extremadura is the first local (sub-regional) experience of smart specialisation and the first S3 developed by a rural development LAG in Europe. Although this pilot initiative is aligned with and supported by the Extremadura S3, continued coordination between the two governance levels will be critical to its implementation.

Finally, in Catalonia new territorial partnerships are explicitly planned in the regional S3 implementation phase to promote major collaborative initiatives, such as in the case of the Territorial Specialisation and Competitiveness Projects (PECT).

More information

See the Spanish S3 strategies' repository - REDIDI network (in Spanish)

See the Basque Country S3 strategy (in English)

See the Catalonia S3 webpage (in English)

See the TAGUS project webpage (in Spanish)

Keywords

S3 governance, multilevel governance, stakeholder platforms, public sector role
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