Channeling RDI into new business requires fruitful cooperation
The recently released report by VTT Technical Research Centre of Finland and Gaia Consulting on the development needs of the Finnish innovation ecosystem is an essential piece of information. The observations in the report align with the RDI emphases long promoted by the forest industry; investments in research and innovation must be on a par with other countries or we will fall behind.
As such, this is nothing new. Relying on the good will and voluntary work of researchers is not enough to create international success or carry out major changes concerning systemic challenges.
Moreover, it is not surprising that Finland needs better understanding of the instruments promoting the growth of the economy as well as close-knit cooperation between operators in choosing the focal points. In fact, there are various public financial instruments. However, the selection of instruments is regrettably fragmented and the use of different tools requires businesses to extensively study the preconditions and schedules. The system lacks flexibility.
The report by VTT and Gaia defined four essential factors for great RDI ecosystems: long-term funding, coordinated cooperation and extensive value created by the ecosystem. In addition, the ecosystems need a shared vision, taking equally into consideration the needs of industry, a sufficiently ambitious research agenda and social impact.
Finnish Forest Industries supports the idea of examining the bigger picture instead of structural reforms and new instruments and aiming to promote cooperation between instruments and parties. Better channeling of the results of RDI activities into a profitable business in Finland should be the number one priority. Of course, in addition to developing the innovation ecosystems, this requires a competitive business environment as well as consistent business and industrial policy.
Industrial companies make long-term RDI investment decisions. The projects span multiple years, both in terms of execution and their cost effect. Fluctuating innovation policy creates uncertainty about the conditions of innovation projects. This increases financial risks and has a direct impact on investment-related decision-making.
Businesses need to be able to trust policy to remain valid for at least 5–10 years. In Sweden, for example, binding funding decisions are made for up to 12 years. The Innovation Fund of the EU also provides 10-year funding for individual investment projects. This is the type of long-term mindset Finnish Forest Industries hopes for in Finland as well.
It is vital to promote the market-based green transition of the Finnish industry to target RDI funding for the development of new, recyclable biomaterial and product technologies replacing fossil solutions. Finnish operators have the desire and ambition as well as successful proof for advancing those sectors.
For 150 years, Finnish Forest Industries has been a trailblazer for the reforming and internationally competitive trade and industry in Finland. We know that, in the future, we will be able to create more sustainable products offering extensive climate and financial benefits on global markets. However, scalable nuggets of green gold can only be achieved by sufficiently investing in the development of our business environment and in securing our growth and competitive strength over the long term.
This is no small feat. The global market for forest industry products is growing strongly. According to the analysts of AFRY, it will increase by EUR 175 billion by 2035. By becoming a pioneer in our innovation activities, we will be able to take full advantage of this growth.