creating innovation policy frameworks to unlock …creating innovation policy frameworks to unlock...
TRANSCRIPT
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Creating Innovation Policy Frameworks to Unlock the Value
of Green Growth
Richard A. JohnsonVice-Chairman, BIAC Technology Committee;Chairman, Biotechnology and Nanotechnology
Committees
OECD Workshop on Delivering Green GrowthSeoul, 5-6 March 2010
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New Thinking about Innovation is Key to GG
• It’s not just about R&D and S&T – the key role of non-technological innovation
• The demand-side matters, too– Smart Regulations and standards– Public procurement and demand supports– Demand-led Innovation
• Emergence of New Business Models and Types of Public-private Collaborations – No One Size Fits All – at the Global, Regional and Local Level
• Open Innovation allows “plug and play” on a global scale
• GG must be placed in context of broader Innovation
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Integrating Green Growth as a Core Part of National Innovation Systems
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2. Convergence Creates New Opportunities for GG
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Interdisciplinary is the New Normal – Complexity, Convergence and Networking
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Policy Frameworks to Realize the Potential of Multiple Core Technology Platforms for Creating Economic
Value and Meeting Societal Grand Challenges
• Next-generation ICT
• Bio-based Economy and the Life Sciences Revolution– Industrial Biotechnology and Sustainable Bio-based products– Synthetic Biology– “Omics”
• Nanotechnology
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3. Multiple Dimensions of Green Growth Sustainability for Business
• All business sectors have potential for green growth
• Aligning the corporate “green growth” strategy with its overall business strategy– Environmental strategies integrated (2x increase in 4 years)– Green branding and value creation across the product and
service life cycle (80% of CEOs now agree)– Compliance management – regulatory, standards, reporting– Knowledge management– Cost-efficient sustainability
• Performance monitoring• Advanced modeling techniques
IBM – Green and beyond (2009)
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GG - Moving from Business Cost to Business Growth
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Key Goal for Business: Unlocking the Value in Green
• Instrumentation + Interconnections + Intelligence
• Promoting sustainable operational efficiency– Supply chain management– Design for green growth and sustainability– Greening of jobs– Green buildings and Infrastructures– Intelligent “green growth” ecosystems
• Low-Carbon Conversion Challenges for Policy – GG is not “painless”– Predictability and Sustainability of Policy Measures– Structural Adjustments and Transition Costs– Transaction Costs and Unintended Competitive Consequences
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Energy Efficiency and Best Available Technologies Provide a “Win-Win” for Business and Public Policy
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• You are only as Green as your Supply Chain
• Design products with sustainability as core principal
• Meaningful goals and metrics (‘What gets measured gets managed”)
• Supply network key to environmental/energy strategy
• New competitive edge for suppliers
• Standards and collaboration
Increasing Role of Supply Chains in Green Growth
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Customer-Driven Innovation for Green Growth
• Key shift: consumer expectations about green growth change how we define, design and deliver value
• Emerging Marketplace for Values
• But don’t market to “green consumers” (S. Bishop, IDEO)– Alienates mainstream base of consumers– Green ghettos derail green growth– Marketing and consumer studies increasingly show:
• Ted Levitt/HBS: “people who buy electric drills don’t need drills, they need holes”
• Consumers want solutions to their day-to-day needs that also make sense for the environment, energy and climate change
• Increased role of brands, corporate sustainability strategies, competition
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Knowledge-Intensive Services Enable GG
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4. Entrepreneurial Ecosystems Increasingly Drive Green Growth
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Enabling the Entrepreneurial Ecosystem for Green Growth
• Governments need to support all types of entrepreneurship and an entrepreneurial culture – SMEs (sustainable companies that can grow are key)– Increased competition for global enterprises– Social Entrepreneurship– Venture Philanthropy and Market Accountability– Emergence of Public-Private Entrepreneurs (PPEs)
• Increasing role of university-based entrepreneurial ecosystems at the heart of GG – New university-industry models: collaboratories and
broader/deeper partnerships (e.g., MITEI and OSCAR/Brown)– New opportunities for commercialization
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5. Investment and Capital Formation Demand More Attention, More Predictability and More Innovation
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Promote Sustainable Policies for Investment and Capital Formation – and Don’t Forget Tax Policies
• Short-term stimulus measures v. MT/LT sustainable financing, linked to tax and capital formation policies
• Subsidies are not optimal LT instruments
• Public funding instruments: few “innovative” instruments and approaches to finance eco-innovation; need a mix of different instruments
• Private funding -- private equity and VCs are necessary but not sufficient; need a broader toolkit (including bank incentives for R&D)
• Public-private partnerships and leverage public R&D
• Avoid distortions for environmentally-friendly goods and services
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Need Multiple Financing Mechanisms to Overcome Gaps
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Technofixes – Low Hanging Fruit (Connors, MITEI 2009)
• Five Classes• • Buildings and Appliances
• • Vehicle Fuel Economy and Biofuels
• • Industrial Energy Efficiency
• • CO2 Intensity of Power
• Four Questions• • Only CO2 Cost Benefits?• • New Energy Technology Bias? (New vs. Retrofits)
• • Substitution of Energy with Information
• • Reliability/Variability
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6. Broaden Policy Focus from Green Jobs to “Greening of Jobs”
• Innovation capacity in GG depends on Human Capital
• Innovation + Green Growth = Job Creation
• Interactions among sectors and green employment –both traditional and new “green growth” business
• Investment in training, skills and education for GG
• Creating “sustainable” and “growth” SME jobs
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7. Create Smart Infrastructures for Green Growth
• Smart Grids, Sensors, and Digital Utility Networks
• Transportation and Logistics
• Systems Approach
• Intelligent energy exploration, production and storage
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McKinsey “Pathways to a Low-Carbon EconomyVer.2 Global Greenhouse Gas Abatement Cost Curve”
(Jan.’09)
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Infrastructure Includes Smarter Buildings and Construction (U.S. – Sec’y Chu/DOE) – Open
Innovation and Trento
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Policies Linking Short and LT GG Investment -- Smart Grid Infrastructure (EPRI)
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Need for a Common Language and Metrics in GG Infrastructure – What’s a “Smart Grid”?
• Many Flavors of the “Smart Grid” – Steve Connors, MITEI (Oct. 2009)• • Which Smart Grid are You?• • Large Scale Renewables Integration (HV/MV)• • The Smart Meter-Smart House Smart Grid (LV)• – Including Net-Zero Buildings and Smart Vehicle Charging
• • Local Microgrids - with Dist. Gen. and V2G• • All of the Above? If so, when and how?
• • How Smart is Your Smart Grid?The “Mensa Grid” (Genius Grid)
• The “Not Dumb Grid”• The “Not as Smart as it Thinks it Is Grid”• • Beyond Smart Grid OEM Hardware…
• • Who’s Smart Grid is It? (Access and use of Information)• • Timely Upgrade/Retrofit Approach• • Who Invests? Who Pays? Who Benefits
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New Policy Frameworks to Link GG Infrastructures, New Technologies and “Old” Industries
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8. Intellectual Assets, IPR and Knowledge Networks Increasingly Drive GG and Value Creation
– Intellectual Assets for Value Creation – it’s more than IPR
– Proliferation of Knowledge Networks and Markets
– Getting the IPR Framework “Right” • Investments, risk sharing and ROI• Tradable, securitization, and transparent• Incentives
– Collaborative Mechanisms for Green Growth• New Access and Diffusion Models for IPR• Precompetitive Consortia• New Models of Public-Private Partnerships
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Networks and Boundary Spanning Intermediaries (Steward)
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9. Strategic Partnerships Increasingly Drive Green Growth – “No One Size Fits All”
• Sponsored Research and “windows into research”• Increased trend toward “Collaboratories” and other
longer-term, multi-directional partnerships • “User-driven Innovation” and distributed R&D networks
create new commercialization opportunities• Integrating entrepreneurial ecosystems and investments• Public-private partnerships for addressing societal issues • Social Entrepreneurship and Venture Philanthropy• Pre-competitive and shared infrastructure• Spatial Dimension of Innovation -- Location-specific
competencies and the role of clusters/hubs
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10. Need Systems Thinking in Policymaking for Green Growth
• Essential to solving complex problems
• Broader context of interconnections and networks must be linked to – Technological– Business– Organizational– Social issues
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THANKS! 감사합니다
Contact Information – Richard A. Johnson
CEO, Global Helix [email protected]
Senior Counsel and Senior Partner (Ret.), Arnold & Porter LLP