Higher education institutions (HEIs) play a key role in educating young people to understand the underlying values in societies and cultures, which create crucial abilities to foster social integration. To succeed in this, the teachers and students of HEIs need novel ways to increase intercultural understanding and social inclusion. Hence, in the project we aim to create a comprehensive educational model grounded in experiential and challenge based learning to increase the higher education institutions’ societal engagement (HEISE). The objectives of the HEISE project are to engage the local challenge owners and the HEI students into the joint teams and to apply various arts based methods to make the different views visible in the challenge solving processes. The HEISE project will consist of two main Intellectual Outputs (IO) that have independent but intertwined paths. First, IO1 concentrates on building a participatory learning model for societal engagement for HEIs through a challenge solving course module with an e-publication for teachers guiding through the methodological approach of the course. Second, IO 2 consists of activities that create a model for HEIs to evaluate their societal impact and the engagement in societal projects. This outcome of the project will help the HEIs to better integrate the societal impact into their strategies.From the methodological point of view the HEISE project will be carried out through a systematic process that begins with an investigation of the existing participatory learning methods. Based on the results of this investigation, a challenge based learning model will be developed and tested within a course module called “Challenge based societal engagement”. The new course module will be evaluated with an action research method, which will contribute to the further development of the challenge based learning model for societal engagement of HEIs. A similar systematic method will be used to create a model for evaluating the HEIs’ societal impact the engagement with the society.This is a 36-months project with six (6) partners: Estonian Academy of Music and Theatre (Estonia; main coordinator), Sibelius Academy of the University of the Arts Helsinki (Finland), Laurea University of Applied Sciences (Finland), Aalto University (Finland), Estonian Business School (Estonia), Universidad del País Vasco/ Euskal Herriko Unibertsitatea (Spain). The partners represent widely the field of HEIs from art to business and social sciences to economics. The profiles of partners cover the expertise required in carrying out the project by combining knowledge of social and societal challenges, higher education pedagogy, innovative learning methodologies such as arts based methods as well as evaluation of impacts.One of the main results of HEISE project is a comprehensive toolkit for HEI teachers to integrate challenge based learning methods into their teaching. This will further result in greater societal engagement and impact of HEIs. The students and stakeholders of HEI will be affected by the challenge based learning methods during the course modules organized by the project, which will result in a more active dialogue between them while solving the real-life societal challenges collaboratively. On the other hand, the project has an impact on the management of HEIs and the way they strategically integrate the societal engagement and impact into their operations. One concrete outcome of this part of the project is to provide a model how to evaluate the societal impact of HEIs. The longer-term benefits of the HEISE project lies in the further development of course contents in which the challenge based learning methods are utilized. In addition, the longer-term impact of systematically evaluating the impact of HEIs will increase the importance of the topic. In a long run this will lead to broader societal engagement of HEIs, which will further affect the ways citizens understand intercultural and social inclusion.