Future of Social Impact: What to Watch in 2026
What does 2026 mean for the future of social impact?
Across the globe, 2025 was marked by disruption and realignment. Shifts in foreign aid flows fundamentally upended humanitarian and development efforts, while attacks on social safety net benefits have increased precarity for millions of households already living on the edge. Climate-related disasters around the globe placed enormous strain on local systems and exposed deep inequities in preparedness, response, and climate change’s intersectionality with health outcomes and economic stability. In the United States, policy changes such as the passage of the Big Beautiful Bill altered the operating environment for foundations and corporate giving, while intensified attacks on diversity, equity, and inclusion efforts created new risks and constraints for organizations committed to equitable outcomes. These shocks unfolded alongside the rapid advancement of AI, a broader erosion of trust in institutions, and rising polarization in many societies, reflecting systems under strain worldwide.
Navigating compounding crises that demand immediate responses and long-term focus on systems change requires more than resilience, and leaders cannot rely on established playbooks or wait for full clarity before acting.
“The complexity we face in 2026 requires a different kind of leadership,” said John Harper, CEO of FSG. “We need leaders who are grounded in purpose while adapting rapidly to changing conditions. This means building authentic partnerships where communities shape solutions, not just validate them. It means bringing business discipline to our strategies without losing sight of the systemic change we’re pursuing. The leaders who will succeed this year are those who refuse to choose between immediate response and long-term vision.”
As we enter 2026, we asked leaders across FSG to share how social impact leaders can rise to the challenges of the upcoming year.
1. Cultivating adaptive, purpose-driven leadership
“In the year ahead, leaders of collaboratives and funders alike will need to be more adaptive than ever, able to navigate uncertainty while staying deeply grounded in purpose,” said Jennifer Splansky Juster, Executive Director of the Collective Impact Forum. “Effective leaders in this moment will be those who flex and evolve without losing sight of their long-term goals.”
This adaptive capacity rests on a foundation of inclusion. “During a time of division, inclusive leadership isn’t optional but essential for social impact,” said Bobbi Silten, Chief of People & Culture and Managing Director at FSG. “And at the heart of inclusion is empathy. Empathy is grounded in self-awareness, listening without an agenda, and connecting across different life experiences. It trades judgment for curiosity, certainty for questions. If we seek to shift systems and create meaningful change during these difficult times, leading with empathy is vital.”
Yet empathy must be paired with strategic capability and business acumen. The next generation of leaders must understand how to navigate complex organizations, build coalitions, and drive change within systems resistant to it. “As global and economic megatrends like AI and shifting global trade transform the landscape around us, the next generation of corporate changemakers must rise as agile, culturally intelligent, business-minded enterprise leaders,” said Chirlie Felix, Managing Director at FSG. “The mandate is clear: talent and culture leaders must become skilled coalition builders to achieve lasting impact.”
2. Harnessing AI to advance systems change
Artificial intelligence is no longer an “in the future” or experimental tool–it is rapidly becoming essential infrastructure for social impact work globally. While AI adoption patterns vary significantly by region, the fundamental question remains universal: how to deploy AI strategically for equitable outcomes across diverse contexts.
“We’re witnessing AI move through distinct phases of adoption in the social sector,” says Abigail Ridgway, Managing Director at FSG. “Early adopters started with internal operations—streamlining grantmaking processes, automating reporting. Now we’re seeing a more sophisticated second wave: foundations and nonprofits using AI not just to work faster, but to think differently about problems themselves. AI is helping organizations surface hidden patterns in community needs, identify emerging issues before they become crises, and stress-test strategies against multiple scenarios. The most exciting frontier is using AI to understand opportunities we couldn’t see before—revealing unexpected leverage points for systems change or connecting dots across siloed issue areas. The question is no longer whether to adopt AI, but how to deploy it in service of deeper insight and more equitable outcomes.”
These adoption patterns carry profound workforce implications, particularly for gender equity, as women face disproportionate exposure to AI-driven automation. According to the International Labour Organization’s 2025 research, women in high-income countries are nearly three times more likely than men to hold jobs at the highest risk of automation (9.6% of female employment versus 3.5% of male employment), with women disproportionately concentrated in administrative, customer service, and data-processing roles.
Vikram Jain, Managing Director of FSG Asia, shares, “As AI reshapes work, it can either widen or close gender gaps. Our responsibility is to build systems that advance women’s economic empowerment, not undermine it.”
Beyond these equity concerns, AI lacks the track record and precedent that organizations across sectors typically rely on when assessing new tools, making it difficult to distinguish between transformative potential and expensive distraction. “As more leaders turn to AI for decision-making, we must ensure these tools enhance rather than replace community perspectives,” says Abhishek Khanna, Director at FSG Asia. “Without intentional deployment strategies, we risk creating sophisticated solutions that fail in practice and deepen the very inequities we’re trying to address.”
3. Embracing skills-based pathways to economic mobility
Skills-based hiring has emerged as a critical strategy for expanding economic opportunity amid intensifying workforce shortages, the rising cost of higher education, and AI-driven changes to job requirements. Currently, 85% of employers are using skills-based hiring, with 53% changing educational requirements to focus on competencies and experience. This shift opens pathways for millions of workers who have gained expertise through alternative routes.
“Degree-based and skills-based hiring aren’t opposing strategies; they are complementary approaches that, when used together, expand access to opportunity,” said Scotland Nash, Director at FSG. “Skills-based hiring doesn’t diminish the value of education; it opens pathways for talented individuals who may have gained expertise through alternative routes and recognizes that capability can be built in many ways without compromising quality.”
The benefits of this approach extend beyond access to jobs. Companies implementing skills-based hiring see up to 25% higher employee retention rates after two years, while 38% of workers hired based on skills report being very happy in their roles, compared to only 28% of those hired based on experience alone. However, successful implementation requires more than removing degree requirements from job postings.
“Intentionally engaging employee voice, including frontline employees, will be critical for businesses to achieve operational excellence and business growth,” said Kendra Berenson, Director at FSG. “Businesses need to build enabling conditions to encourage employees to share and systems to meaningfully integrate their input.”
4. Doubling down on place-based strategies and local civic infrastructure
The 2025 Edelman Trust Barometer revealed that government is seen as the least competent and ethical institution, with 61% of people globally holding the belief that government serves narrow interests and makes their lives harder. With this global erosion of trust, place-based work has never been more critical.
“Without a doubt, take the local route,” said Courtney W. Robertson, Director at the Collective Impact Forum. “With trends demonstrating heightened distrust in national government and stronger trust in local government—a pattern we see globally—continuing to invest locally in the everyday people, institutions, and civic infrastructure necessary to drive meaningful change remains a critical factor in sustaining social impact and the protection and reimagining (or realignment) of our democracy.”
The challenge for 2026 lies in building place-based work that achieves scale without sacrificing the trust and relationships that make it effective. “This year, I am paying attention to how funders are reconciling the continued increased focus in place-based work and community organizing with a desire for scale,” shared Chris Carlson, Managing Director at FSG. “Building on the work of Hahrie Han and others, there is growing interest in supporting the intimacy and effectiveness of small organizations and associations but weaving them together in relational networks, like a honeycomb, to create movements. I’ll be particularly interested to learn from leaders about what works best to build those connections between ‘cells’.”
Central to this networked approach is investing in local leaders themselves. “I anticipate that funders will focus even more on bringing local leaders together to foster the skills, mindsets, and relationships to mobilize collective action and drive lasting systemic change,” said Ryan De Souza, Director at FSG. “This alignment increases the scale of funder investments, reduces duplication and competition for resources, positions the community to absorb and deploy capital more effectively, and ultimately activates these leaders as partners with each other and with funders in advancing a shared vision for equity.”
5. Building adaptive philanthropic strategies amid disruption
Ongoing political and economic uncertainty is pushing funders to develop adaptive strategies that can respond to immediate needs without abandoning long-term systems change efforts.
“As we continue to see significant uncertainty and unrealized impacts of economic and political shifts, funders are increasingly focused on ‘future proofing’ their strategies, by thinking more about how they work in a way that is transferable across specific issue areas,” shares Clare Schroder, Director at FSG. “This enables responsiveness to emerging needs, without changing course on long-term, systems change efforts.”
Fay Hanleybrown, Managing Director and Head of FSG’s U.S. Consulting practice, agrees, noting that “In times of uncertainty, it is even more important for funders not to be prescriptive about specific solutions but instead to act as facilitators, connectors, and learners, and to listen deeply to grantees and community partners to determine what is most needed. Funders can increase payout in the short term, and can also leverage the full set of tools at their disposal beyond grantmaking – from informing policy and narrative change to supporting new collaborations to navigate the changing landscape.”
These adaptive strategies are especially critical in areas experiencing rapid transformation, where the pace of change outstrips traditional planning cycles. “The world of work is changing at an unprecedented speed and scale—not only are jobs shifting rapidly due to the acceleration of AI, but workers are experiencing growing financial and social burdens which impact the ability to focus on advancing in their careers,” said Erin Sullivan, Managing Director at FSG. “These changes require those working every day to drive more equitable employment outcomes to engage in rapid reflection and adaptation of their work. Rather than assuming business as usual, funders who share those goals are going to need to consider how they can also be flexible and nimble in their support and expectations of partners to enable the capacity, scale of resources, and innovation needed to ensure these significant shifts don’t exacerbate disparities.”
Yet it’s not just the pace of change that demands new approaches—it’s the complexity and interconnection of these challenges. Addressing them effectively requires funders to break down traditional silos and work across issue areas. “There is growing recognition of the need for funders to collaborate and integrate their efforts so that their funds can create greater impact,” said Sujata Rathi, Director at FSG Asia. “This applies whether they’re working on the same issue or different ones. For example, there’s growing awareness that climate has health implications, yet we’ve seen limited collaboration between climate funders and health funders. It’s important for funders to consider where they might be flexible in their approach and mandates to enable these kinds of partnerships.”
6. Building resilient, purpose-led corporate strategies
As the landscape for corporate social impact evolves, leaders are adapting their approaches to advance purpose-driven strategies in an increasingly complex environment. The most successful companies are moving beyond aspirational commitments to rigorously demonstrate how social impact initiatives drive revenue growth, reduce costs, strengthen talent pipelines, and build competitive advantage.
“Many business leaders committed to social and environmental impact face pushback questioning their work,” said Dane Smith, Senior Advisor at FSG. “While some companies have retreated from their commitments, those who have stayed the course are rigorously exploring the value that purpose-led strategies create. Leading companies are now injecting greater business rigor into these strategies. The most innovative companies are flipping the script, asking: ‘How can we meet the needs of communities and generate business value while we do so?'”
This business discipline doesn’t mean abandoning long-term commitments—rather, it means embedding them more strategically into core operations and adapting implementation to maximize both resilience and impact. “Companies are doubling down on the ‘what’ of their purpose-led strategies, while navigating ways to build more resilience into ‘how’ those strategies are implemented,” said Nikhil Bumb, Managing Director at FSG. “We’re seeing companies continuing to invest in and deeply appreciate strengthening relationships with key stakeholders and partners inside and outside the company; get crisper on the tangible and intangible value these strategies provide to the business, partners, and communities; and utilize these learnings, relationships, and value parameters to allow enough flexibility to adapt effectively based on local context.”
The pressure to demonstrate business value shows up across global contexts, driven by different forces. “We’re seeing Asian companies face growing pressure to demonstrate environmental and social impact—from mandatory sustainability reporting requirements in countries like India, to customer expectations, to global rating systems,” said Subhash Chennuri, Director at FSG Asia. “This is transforming corporate philanthropy from isolated efforts into strategic work aligned with companies’ ESG goals, particularly as corporate social responsibility budgets continue to grow in the region.”
Ultimately, driving business value requires authentic community engagement. “Next year, we expect to see many more corporate social impact teams truly ‘walk the talk’ on being community-centric,” said Lolita Castrique-Meier, Managing Director at FSG. “Rather than designing solutions from the top down, companies will continue centering deep listening and providing the resources and assets communities need to drive their own transformation. This ongoing evolution marks a shift from corporate problem-solving for communities to authentic, community-led change with them.”
As we look toward 2026, intersecting forces reshaping how
societies function create both unprecedented challenges and remarkable
opportunities for social impact leadership worldwide. Successful leaders will
be those who can hold multiple truths simultaneously: that AI is both a
transformative tool and a displacement threat; that while global and national
systems need reform, local infrastructure needs investment; that empathy and
business rigor are complementary imperatives across cultures and contexts. By
doubling down on adaptive leadership, authentic partnerships, and
evidence-based approaches while remaining flexible enough to respond to unique
community needs, social sector leaders worldwide can navigate the upcoming year’s
complexities with purpose.
