Systems practice

We consider social impact investment markets and most of the social issues we seek to affect as complex social systems. We are trying to continuously improve our understanding of how complex systems work and translate such insights into internal practice that is actionable and of added value.

What does "market system" mean?

“By market systems we mean a set of interconnected actors (fund managers, investors, etc) that shape the flow of capital (and support) from asset owners to enterprises and charities, influenced by a set of market conditions, including rules and policies, practices, resources, relationships, power dynamics and mental models."

System change

While “system change” has been part of our mandate and work since the very beginning, over the last few years we have tried to embed system practice more explicitly into our market-building efforts. This remains very much work in progress and has included:

  • Market system maps

    We map key market actors and their relationships with each other, as well as specific conditions – rules and policies, practices, resources, relationships, power dynamics and mental models – that shape those relationships. We then identify the right leverage points where we believe BSC is well positioned to contribute to actual change in the market.

  • Market system change strategies

    Based on our market system maps and identified leverage points, we develop market system change strategies, aimed at addressing specific market conditions and barriers to growing the market. These strategies then drive specific activities that we define as part of our annual business planning cycle.

  • Annual market system progress and learning workshops

    Once a year, we convene comprehensive learning sessions in which we review across the organisation progress against our market system change goals, identify learnings in terms of what appears to work and what doesn’t, and define revised strategies for the subsequent year. The workshops are meant to help us live up to the reality that market systems are constantly evolving and adapting in non-linear ways, which requires us to regularly reflect on our assumptions underpinning our actions.

  • Comment on measuring changes at the market system level

    Measuring changes at the market system level is difficult – methodologically and practically. In certain areas of our market-building work, we have started to identify indicators meant to help us understand whether our activities are effective in terms of intended outputs, and whether the market is developing, as intended. This approach is not a formal evaluation of actual changes at the market system level and our contribution to them. With any changes we do try to capture on an ongoing basis, we do not intend to establish formal attribution regarding our interventions. We acknowledge that many changes in our market system-level theories of change result from a broad range of interconnected, influencing factors, well beyond our own interventions. We are considering a more formal, third-party evaluation of our contribution to key changes in the broader market at the end of the 2025 strategy period.