sustainable society and environmental challenges: how the private sector adapts?

07.04.2011

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Sustainable society and environmental challenges:How the private sector adapts?

HENVI Science DaysTapani JärvinenChairman of the Cleantech Finland Business Forum

The challenges of a sustainable society

A low-carbon and resource-efficient economy by 2050:• Carbon dioxide emissions near to zero• Sustainable and efficient use of natural resources

Society at large and all of its functions must ‘go green’:

07.04.2011 Tapani Järvinen

including food production, living arrangements, mobility, communication, recreation, water and waste management, as well as industrial processes, products and machinery required to meet different societal needs etc.

Companies are becoming greener…

• Companies have paid attention to the environmental impact of their operations for several decades already

• Today, environmental aspects are:– included in corporate strategies and form an integral part of all

business operationsf


– addressed according to life-cycle thinking throughout the production chain

– taken into account across the entire network of operations– also part of management expertise and the professional skills of

the personnel.

…and provide green solutions

• In addition, a growing number of companies practice green business or cleantech, i.e.

offer products, processes, equipment, services or business models by which the environmental impacts of other companies, the public sector or consumers can be reduced.


• Green solutions are being developed across all sectors.

Clean technologies guarantee competitiveness

• Environmental soundness is prerequisite for the license to operate.

• Environmentally sound process solutions give reliability, availability, maintainability and safety for the operations– Trouble-free production ensures constant and effective

production

B tt t ti d h h ld l ith t i bl


• Better reputation and shareholder value with sustainable technologies.

• Profitability and environmentally sound technologies can go hand in hand.

Competitiveness of a producer: Environmental profit

Benefits

licence to operateeffective use of raw materialslower energy consumptionlower water consumptionless emissionsbetter reputation and shareholder valueb tt l f t

With new technologies it is possible to utilize the


Environmental performance

better employee safety>> cleaner world

potential in full

L. Lankoski: Determinants of Environmental Profit, Helsinki University of Technology 2000

win-win area

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Competitiveness of a technology supplier

• Industry needs more efficient and clean production methods >> new business opportunities

• Technology supplier must be proactive

• Developing better technologies brings competitive advantage today and in the future

• It is not enough to develop clean technologies but both


• It is not enough to develop clean technologies, but both economical and ecological criteria must be fulfilled

• Only those technology companies survive in the long run who deliver sustainable technologies

Adding environment to the competitiveness equation does

not hinder growth, on the contrary it can be


on the contrary, it can be a booster for competitiveness

and economic growth.

600

800

1 000

1 200 2020 (growth 2010-2020)2010 (growth 2007-2010)2007

Global market volume of cleantech expandingEUR billion


0

200

400

Source: Roland Berger 2009 (Greentech 2.0)

Wastemanagementand recycling

Mobility Materialefficiency

Power generation

Water management

Energyefficiency

Finnish cleantech strongholds

• The strengths of the Finnish economy have traditionally been based on our natural resources: forests, waters and mineral resources.

• Well-known Finnish products and technologies include, for example:sustainable technologies and solutions for minerals and metals


sustainable technologies and solutions for minerals and metals processing, energy efficient industrial processes, bioenergy boilers, frequency converters, wind power components, clean transportation fuels, water purification chemicals, waste management systems, monitoring equipment and ICT.

Characteristics of the Finnish cleantech sector• Approx. 4000 companies, some hundred of which globally

competitive. Turnover more than 16 billion Euros.

• A number of companies have modified their existing operations to better respond to the growing demand for green business.Some have made significant strategic choices towards this direction.Many large Finnish companies’ products are already today to large

07.04.2011 Tapani JärvinenTekijä

• Many large Finnish companies’ products are already today to large extent classified as Environmental Goods and Services (by OECD definitions), examples: Outotec, Metso, Wärtsilä, etc.

• The sector is experiencing strong growth in Finland − new start-ups are emerging.

• Primary export countries include Germany, China, USA, other Asian countries, Sweden and Russia. India growing in importance.

Sustainable products and services, Outotec example

• 63% of Outotec’s technologies are classified as Environmental Goods and Services (by OECD definitions). They:– Reduce the need of natural resources, energy

and water– Reduce negative environmental impacts


Reduce negative environmental impacts– Are process-integrated environmental and energy

solutions• Social responsibility and work place safety on

a high level• Well-being of employees is important

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Great global potential for Finnish cleantech expertise• By offering environmentally sound products and solutions

worldwide, Finnish companies can reduce global environmental impacts far more than if the benefits were limited to Finland alone.

• Global business opportunities for cleantech are huge and Finnish companies are well positioned − however, competition in green markets is intense.


green markets is intense.• To succeed in global markets, cleantech companies require the

same prerequisites for success as business in general.• Many companies active in environmental business in Finland are

small in size: cooperation through different networks and clusters is essential.

Greenb i

MarketsExpertise

The prerequisites for [green] business


business

Cost competitiveness

Cooperating with universities and research institutes− green skills and know-how needed in all businesses

• Green skills and know-how are required within all types of businesses.

• Can be understood as: 1) special expertise in environmental issues 2) part of all professional skills and know-how.

• Education plays an important role in achieving the level of green skills and know how required in businesses


skills and know-how required in businesses• A good way to enhance this is to promote co-operation between

educational establishments and enterprises.• Alongside environmental expertise, entrepreneurial, business

and innovation skills are also crucial• Listening to customers, markets and authorities is important

Cooperating with universities and research institutes− eco-innovations are created in networks

• Eco-innovation = environmentally friendly products and services, eco-efficient production methods and processes, and new innovative ways of thinking, organising and operating

• Eco-innovations are created in interactive and multidisciplinary processes that involve ever expanding networks.

• Research institutes and universities are often important co-operation partners for companies in the early stages of an


operation partners for companies in the early stages of an innovation.

• Many companies active in environmental business are small in size. Networks and clusters offer fruitful co-operation platforms especially for SMEs. Examples: Strategic Centers for Science, Technology and Innovation (SHOKs), Center of Expertise Programme OSKE (Finnish Cleantech Cluster)

Tools to promote Finnish environmental expertise

• Cleantech Finland Business Forum: an informative and interactive platform for companies and other organisations in the Finnish cleantech sector.

www.ymparistofoorumi.fi

C


• Cleantech Finland brand: aims to enhance the exports and internationalization of Finnish cleantech companies.

www.cleantechfinland.com

Concluding remarks• To respond to modern-day environmental challenges, society at

large and all of its functions must ‘go green’ • Companies play an decisive role by

− improving the environmental performance of their operations− offering green solutions for consumers and citizens

• Adding environment to the competitiveness equation does not hinder equitable growth, on the contrary, it can be a booster for competitiveness and economic growth.

• Finnish companies have solid environmental know-how andFinnish companies have solid environmental know how and expertise for which there is a growing global demand

• To succeed in global markets, cleantech companies require the same prerequisites for success as business in general.

• Cooperation through different networks and clusters − including universities and the research community − is also essential.

www.ymparistofoorumi.fi

THANK YOU FOR YOUR ATTENTION !

sustainable society and environmental challenges: how the private sector adapts?

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