Changing the System: The Role of Multi-Stakeholder Initiatives and Ecosystems in an Era of Fragmentation

Ecosystem Note 1 by Andreas Ufer and Valentina Mansur

The Global Zeitgeist: Converging Crises and Fragmented Responses

The world is at a critical juncture. Global challenges such as climate change, biodiversity loss, inequality, and the erosion of social cohesion are converging with rapid technological advancements, misinformation, and geopolitical tensions. At the same time, our ability to make collective decisions and act in concert has diminished. We are witnessing the decline of multilateralism on a global level, increasing tensions between regions, and a breakdown in social and political trust within nations. The very mechanisms that once enabled compromise, consensus, and coordinated action are weakening, leading to fragmented responses to issues that demand collective solutions.

“We collectively create results that nobody wants because decision-makers are increasingly disconnected from the people affected by their decisions.” - Otto Scharmer

Mass migration, driven by conflict, climate change, and economic instability, further complicates this landscape. Millions of people are being displaced, leading to humanitarian crises and increased pressure on host countries, especially in the global north. This migration often exacerbates existing tensions and strains resources, highlighting the interconnected nature of global challenges.

Today's challenges are not just complex; they are systemic, interconnected, and unfolding simultaneously. Climate change is accelerating as biodiversity is declining at an alarming rate, and inequality is deepening. Social cohesion is deteriorating, with democratic institutions under threat and rising polarization creating divides within societies, as social groups move farther apart. Meanwhile, misinformation spreads unchecked, fueling distrust and fear. Technology, which has immense potential for progress, also presents threats such as cybercrime and surveillance. Regional conflicts, local violence, and organized crime add further layers of complexity, threatening both human wellbeing and natural life. These challenges are not isolated; they are facets of the same operating model that has lost its ability to sustain itself and is no longer fit for purpose.

Although there are still a lot of questionable moves when it comes to sustainability and social impact, there are players in all sectors who have been making real efforts to address these complex issues, and those who chose this path face many challenges. The private sector worldwide is struggling to redesign its operations to ensure long-term sustainability and meet new demands, while incentives and competition are reinforcing the logic of short term profit maximization and cost minimization. People working in the non-profit sector, which has as its core purpose to address social and environmental issues, are getting frustrated and exhausted due to the insufficiency of their efforts to create change at a systemic level, as well as their struggle to bring these issues to the discussion table in a way that they are considered matters of collective interest that are above political inclinations. The political environment, and by consequence, the public sector is getting more and more polarized, with an increasing inability to promote the open dialogue that is needed to discuss public issues.

The urgency of these interwoven social and environmental matters demands rapid and coordinated responses, yet we are losing our ability to align and act collectively. Multilateral institutions, often held back by outdated governance structures and representation, are struggling to fulfill their mandates, as national interests take precedence over collective welfare. Regional tensions are rising, and, at the local level, political and social polarization is undermining democratic processes. The fragmentation of our decision-making systems threatens our capacity to effectively address the pressing crises of the 21st century.

Multi-Stakeholder Dialogic Processes: Building Bridges and Aligning Visions

In this context, multi-stakeholder coalitions can help to create an alternative. They arise from a recognition that no single actor or sector can solve complex global challenges alone. Instead, they bring back the importance of engaging diverse stakeholders—governments, businesses, civil society, academia, and local communities—in collaborative dialogue and collective action. An example is B Lab, which along with its Latin American counterpart Sistema B, has created a global network uniting players from all sectors around the mission of redefining business success by promoting the concept of B Corporations — companies that meet high standards of social and environmental performance, accountability, and transparency. In Latin America an array of initiatives and programs facilitated by Sistema B aims at bringing different sectors to the discussion, such as B Lawyears for the legal sector, B Academia, for academic institutions and Cities Can B for multiple stakeholders in urban systems.

By welcoming diverse interests and fostering collective action between diverse sectors, these multi-stakeholder initiatives are able to stand in a more neutral position to promote meaningful discussions about real problems without falling into polarized and stigmatized categories. They create spaces where different perspectives can be heard and where trust can be rebuilt. By facilitating dialogue across sectors, these platforms help bridge divides and align visions, enabling stakeholders to co-create solutions that are more inclusive, equitable, and sustainable. 

In this sense, central to the success of multi-stakeholder processes are dialogic approaches and the facilitation of intersectoral conversations. Dialogue is not just about exchanging information; it is about engaging in generative conversations, creating shared understandings, and building relationships that can sustain long-term collaboration. In an era of increasing polarization, dialogue provides a means to rebuild the social fabric by fostering empathy, trust, and a sense of shared purpose.

Facilitated conversations, in multi-stakeholder context, help participants move beyond entrenched positions and explore underlying values and motivations. By creating safe spaces for open and honest discussion, these processes allow stakeholders to surface tensions, identify common ground, and develop a shared vision for the future. This is particularly important when addressing systemic challenges, as it helps to align the diverse goals and interests of different actors, paving the way for coordinated action.

Platforms that facilitate multi-stakeholder dialogue and collaboration are essential for addressing the intersecting crises of climate change, environmental collapse, inequality, and democratic erosion. They enable stakeholders to co-design initiatives, pool resources, and amplify their impact. Such platforms can also serve as incubators for innovative solutions, providing the space for experimentation and the development of new approaches that can be scaled to address systemic issues.

The Potential of Ecosystem Level Initiatives to deepen and scale impact

Concurrently with the increasing implementation of different constellations of multi-stakeholder initiatives, new ways of working in complexity by harnessing the emerging potential of looser networks of actors are evolving. These new approaches aim at scaling and deepening the impact of collective interventions by focusing on leveraging specific fields or social ecosystems. Social ecosystems  can be defined as networks of interdependent stakeholders with complementary functions, interacting around a thematic field or territory. Ecosystems are dynamic, adaptive, and capable of responding to emerging challenges and opportunities. They are characterized by diverse roles—such as catalysts, community builders, and conveners—that contribute to the health and resilience of the ecosystem.

This Ecosystem Level approach, often called ecosystem catalyzation, goes beyond traditional partnerships by fostering these dynamic networks of actors who share a common purpose and work together to influence the broader system. This involves identifying leverage points where small interventions can lead to significant shifts and using strategic experimentation to drive systemic change.

Ecosystem catalyzation requires holding collaborative spaces, convening multiple parties, generating some degree of convergence in support structures and key institutions, nudging and creating impulses to foster new ways of thinking, working and relating, to create ripples in broader systems. In practice, it consists in an intentional process of identifying actors from diverse sectors currently or potentially implicated in the ecosystem's dynamics, and working with them by strengthening connections and aligning efforts to produce collectively desired results.

B Lab, for instance, focuses on building an ecosystem of impact-driven businesses around the world. By working with policy, aligning with academia and fostering a network of practitioners, B Lab seeks to catalyze a global movement that challenges traditional profit-only models and promotes purpose-driven economies, supporting new legal frameworks, fostering collective action and influencing public narrative.

[1] Dynamics of Ecosystem Building.

Multi-Stakeholder Initiatives and Ecosystem Catalyzation in Action

Besides B Lab, there are many other notable examples of successful ecosystem catalyzation efforts that illustrate the power of multi-stakeholder collaboration in driving systemic change:

• GSG and Impact Investing: The Global Steering Group for Impact Investment (GSG) is a global ecosystem catalyzer that has advanced the field of impact investing. By engaging governments, investors, and entrepreneurs, GSG has created a network that promotes the allocation of capital towards initiatives that generate both financial returns and positive social impact. This movement has shifted the investment landscape, encouraging more stakeholders to consider the social and environmental outcomes of their investments.

  
  

• Movimento Viva Água: In Brazil, the Movimento Viva Água is an example of a multi-stakeholder initiative focused on water conservation and management. By bringing together public institutions, private companies, civil society, and local communities, the movement aims to protect water resources, promote sustainable water use, and ensure access to clean water. This ecosystem approach ensures that all relevant actors are involved in decision-making and implementation, leading to more effective and sustainable outcomes.

Roles of Public, Private, Non-Profit, and Philanthropic Sectors in Ecosystem Catalyzation

Ecosystem catalyzation relies on the active participation of various sectors, especially the public, private, philanthropic and broader social sector, each bringing unique strengths, perspectives, and interests to the table.

• Public Sector: The public sector plays a critical role in creating an enabling environment for systems change. Governments can provide the regulatory framework, incentives, and funding needed to support ecosystem initiatives. They also have the authority to convene stakeholders and ensure that marginalized voices are included in decision-making processes. However, political considerations and short-term electoral cycles can sometimes limit the public sector's ability to take bold, long-term action.

  
  

• Private Sector: Businesses are essential for driving innovation and scaling solutions. The private sector's ability to mobilize resources, develop new technologies, and create market-based solutions makes it a key player in ecosystem catalyzation. Companies that adopt sustainable practices and align their business models with social and environmental goals can help shift entire industries. However, the private sector's focus on profitability can sometimes conflict with the broader goals of social and environmental impact, requiring careful alignment of incentives.

  
  

• Non-Profit Sector: Non-profit organizations are often at the forefront of advocating for systemic change and addressing the needs of vulnerable communities. They bring deep expertise, a commitment to social and environmental justice, and the ability to mobilize grassroots support. Non-profits also play a crucial role in holding other sectors accountable and ensuring that ecosystem initiatives remain focused on the public good. However, limited funding and resource constraints can hinder their capacity to scale their efforts.

  
  

• Philanthropy: Philanthropic organizations provide the risk capital needed to support innovative approaches and pilot projects that may be too risky for governments or businesses to fund. Philanthropy can play a catalytic role by funding ecosystem-building efforts, supporting capacity-building, and fostering collaboration across sectors. By taking a long-term view and focusing on systemic change, philanthropic actors can help bridge gaps and provide the resources needed to sustain ecosystem initiatives. However, philanthropic funding can sometimes be unpredictable, and there is a need for greater alignment between philanthropic goals and the broader ecosystem agenda.

A Multi-level, Multi-horizon Approach

In order to pursue systems change, ecosystem catalyzation seeks to foster emergent innovation towards a desired future in a world of highly complex challenges, creating space for novelty to emerge at the fringes or niches. This implies that the multi-stakeholder initiative that plays a catalyzer role has some level of alignment on the overarching direction in which the ecosystem should go, but doesn’t know yet which solutions can actually create this desired transition.

Ecosystem catalyzation can push for change at multi-levels, influencing the interactions across 3 levels: starting at niches (where innovations emerge), moving new models to the mainstream, or socio-technical regimes (the dominant structures and practices), and thereby influencing the overarching landscapes (the broader, external context, cultural aspects and narratives). Ecosystem catalyzation leverages multi-stakeholder collaboration to create conducive environments for innovations to emerge in the niches, enabling them to challenge and eventually transform the status quo (socio-technical regime). By fostering experiments at the niche level, aligning incentives, and mobilizing diverse actors, ecosystem catalyzation helps bridge the gap between niche-level innovation and regime-level change. Additionally, in the long term it has the potential to change the dynamic pressures from the landscape, promoting broader societal and environmental shifts, through a systemic and multi-dimensional approach to transitions​.

[4] Multiple levels as a nested hierarchy (Geels, 2002: 1261).

Ecosystem Catalyzation involves identifying leverage points within the system where interventions can create ripple effects, transforming structures and behaviors. This requires a balance of long-term visioning (Horizon 3) with deep engagement with existing contexts (Horizon 1) and the capacity to navigate the transition space of experimentation and prototyping the new, associated with niches of innovation, (Horizon 2), as outlined in the Three Horizons framework. By fostering innovation, aligning incentives, and mobilizing diverse stakeholders, ecosystem catalyzation processes can drive the systemic shifts needed to address complex global challenges.

[2] Working with multiple horizons.

Catalyzing the Potential for Collective Action

The potential of multi-stakeholder and ecosystem catalyzation processes lies in their ability to harness the power of collective action. In a world where fragmentation and polarization are increasing, these approaches offer a pathway to move solutions for complex problems forward, building trust beyond polarisation, aligning visions, and creating the conditions for meaningful change. By bringing together diverse actors, fostering dialogue, and catalyzing ecosystems, we can create the collaborative infrastructure needed to tackle the systemic challenges we face.

The time for action is now. The challenges we face are urgent, and the window for effective action is narrowing. Multi-stakeholder processes and ecosystem catalyzation provide a way to move forward, enabling us to work together to build a more just, equitable, regenerative, and resilient future. To address the multiple crises we face, we must invest in the facilitation of intersectoral conversations, build bridges across divides, and cultivate ecosystems that support emergent innovation and collective action to create systems change. Only through such collaborative efforts can we hope to achieve the transformative change needed to navigate the complexities of the 21st century.

Sources:

[1] Social Ecologies: The Practice of Ecosystem-Building, Impact Hub Amsterdam - Ard Hordijk Tatiana Glad.

[2] H3Uni - Three Horizons

[3] New Business for Economic Systems Change, Sense-Lab - Andreas Ufer, Marina Florez, Valentina Mansur.

[4] The Dynamics of Transitions: A Socio-Technical Perspective, Frank W. Geels, Johan Schot.

[5] Understanding Innovation Ecosystems: A Framework for Joint Analysis and Action, MIT D-Lab, Elizabeth Hoffecker, Molly Wenig Rubenstein.