Mission-oriented innovation policies (MOIPs) aim to address well-defined objectives related to a societal challenge (Larrue, 2021[1]). However, strengthening national competitiveness and creating new jobs almost always also feature among the missions’ objectives, if only informally (OECD, 2024[2]). This dual emphasis often appears in the metrics governments use to monitor and evaluate these initiatives (e.g., patents or new spinoffs, as well as progress towards the substantive societal objectives), as they want to solve societal challenges, but generally using technologies or solutions that their citizens and companies have invented. This perspective is inspired by mission-oriented approaches in the past that brought about major technology breakthroughs that resulted in economic growth, as well as broader societal benefit (e.g., in the United States where its mission- and challenge- led programs contributed to the development of the internet and mRNA vaccines (Mazzucato and Whitfill, 2022[3]), and bringing down the utility cost of solar energy (U.S. Department of Energy, n.d.[4])).
Mobilising private investment to address societal challenges
Governments cannot drive both these societal and economic objectives alone, but require investment and action from the private sector (including the financial sector), academia and civil society to be successful. Like for all innovation policies, the private sector will be particularly important in achieving these ambitious aims when it comes to MOIPs, as it accounts for the majority of the R&D expenditure in OECD countries (OECD, 2025[5]) and develops new technologies or the formation of new industries (Köhler et al., 2019[6]). The importance of the private sector in supporting missions goes far beyond these traditional justifications of government STI policy, as it will be influential in the realisation of many major transformative innovation goals through changes to their existing business models (e.g., increasing circularity, or halting and reversing biodiversity loss) (Booth et al., 2024[7]) and shaping the public debate and framing around these broad societal transformations through lobbying, party finance and strategically influencing collective expectations ( (Eckert, 2023[8]) and (Köhler et al., 2019[6])). Because many missions were instigated since 2020, the role of the private sector in supporting missions will continue to grow as they mature, and the demonstration and deployment of novel solutions becomes more critical.
In order to unlock the potential of the private sector and empower it to drive the transformative systems change associated with missions, governments need to develop new relationships and ways of interacting with companies. In this regard, previous research has identified several mechanisms for how MOIPs strive to crowd-in private sector resources. This includes engaging the private sector in the definition of the missions, including relevant partners in the governance of the mission, engaging users in projects, and formal multi-year agreements to formalise the commitment of both the private sector and public sector actors to achieve the mission goals (Larrue, 2021[1]). In addition, governments are using a variety of approaches in supporting mission-oriented innovation through new R&D funding instruments and modifications to existing ones. This includes engaging industry consortia in the delivery of funding, creating exemptions to state aid regulations, establishing new design mechanisms of existing programmes, and prioritising mission-oriented projects in the delivery of programmes (McIvor, forthcoming[9]). These themes are explored throughout this report.
One important caveat to note is that the engagement of the private sector must balance supporting incumbents with allowing for new ideas to emerge. Due to the transformative nature of some MOIPs, there are segments of the private sector that oppose or seek to frustrate the outcome because it will negatively affect their existing business models (OECD, forthcoming[10]). In addition, there are competitiveness concerns with supporting existing actors through such targeted policies that may entrench incumbents’ market positions.
At the same time, private sector interest is often found to be less than MOIPs strive for, and the pace of private sector change is slow (Weber and Wanzenböck, 2024[11]). Many governments struggle to achieve broad engagement from businesses when it comes to taking part in missions focused on transforming broad sociotechnical systems for a number of reasons. Firstly, many mission goals fall under areas with a more considerable role for the public sector and where the private sector is not always seen to play as much of a leading role (e.g., issues regarding healthcare or public transportation). Secondly, engagement with the private sector is often stronger at the outset when it comes to framing mission goals, but then it peters off when it comes to delivery due to coordination issues and requirements to invest their own money. Thirdly, some private sector actors find participating in these types of programmes more complex and time-consuming than with other types of government programming. This complexity is in part due to the longer time horizon at which they operate, which is often not aligned with normal return on investment timelines. The narrower funding calls, as well as additional reporting criteria, make simpler alternative forms of financing from other sources sometimes more attractive (OECD, forthcoming[10]).
In response to these challenges, this paper explores the role of businesses in MOIPs, focusing on (1) what is the (expected) added value of these types of policies for businesses, and (2) how governments can effectively encourage businesses to commit human and financial resources towards mission goals, beyond traditional co-funding mechanisms.
There are several caveats for this study. Firstly, there is no one-size-fits-all approach to mission-oriented policies, with each initiative, and even individual missions, engaging the private sector to varied degrees. As a result, this study can be used to foster discussion but the policy mix and approach to engaging with the private sector should be based on the institutional and political contexts that missions sit within, and evolve over time alongside these contextual factors (Schwaag Serger and Palmberg, 2022[12]). This paper also focuses on how to encourage the private sector to commit resources to government-led initiatives. Companies sometimes run their own mission-oriented programmes (e.g., the Google Lunar X Prize or by establishing and donating to foundations) but these are out of scope for this report.
This paper begins by detailing the businesses’ motivations for supporting MOIPs. The second section present methods for engaging the private sector in framing missions and the third section presents methods for mobilising private sector investment in the implementation. A fourth section outlines a series of recommendations on how to further strengthen private sector support of missions.
This analysis is based on a variety of inputs. At the conference in October 2024, “Mission Forward: Forging New Frontiers in Mission-Oriented Innovation Policies”, the OECD brought together ~140 participants, representing 40 unique mission-oriented initiatives/organisations in 23 countries, and 41 unique missions in a wide range of challenge areas. At the event, participants took part in breakout sessions across four different key issues – notably (1) crowding-in private sector financial and human resources, as well as (2) framing the mission to be at the right level of ambition; (3) enlisting actors, programmes and budgets beyond the STI area; and (4) delivering on their co-developed strategic agendas.
Leading up to the event, each initiative was provided a survey (henceforth, the mission survey) to identify the strengths, challenges and opportunities for improvement regarding its MOIP across the same four key issues. The mission survey was used to create posters for each of the initiatives, which were presented at the event. The results of the survey were coded by the OECD following the event. Of these 508 responses, 110 (22%) were related to crowding in – 79 strengths and 31 weaknesses. This paper captures part of the input from the survey and breakout rooms. More in-depth analysis on a broader range of issues is available in Mission Forward: Forging New Frontiers in Mission oriented Innovation Policies (OECD, forthcoming[10]). Figure 2.1 shows an overview of the main results for the theme on crowding-in, the findings of which are discussed in more detail in the relevant sections below.
Source: OECD (forthcoming[10]).
The inputs from policymakers have been augmented by interviews and written input from 13 private sector actors (see Annex A for the list of participants and their affiliations). These interviewees represented a mixture of companies and industry associations from five unique MOIPs. Some of the interviewees were involved in the governance of individual missions, some helped in the development of the mission, and others were recipients, or represented groups of recipients (i.e., industry associations). The results of this study were validated in a workshop that brought together the interviewees from the private sector and policymakers.