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Green Business Models: The future of eco-innovation

Panel debate at the workshop
  • Published 20/01/2012
The role of business models in green transformation was discussed at a workshop hosted by FORA and arranged by OECD, the European Commission and Nordic Innovation.

The aim of the workshop was to showcase good practice of eco-innovations and enhance the understanding of the role that these new business models can and must play. The outcomes from the workshop will be used in OECD and Nordic Innovation studies, which will be completed in the first half of 2012.


Green growth means aiming for economic growth and development while at the same time protecting natural resources and the environment. Existing technology and consumer behavior can only be expected to produce positive outcomes to a certain point, and therefore innovation is the key to create new ideas, new entrepreneurs and new business models, which can contribute to the establishment of new markets, new jobs and an industrial transformation.


But eco-innovation and green business models are still relatively new to industry and policy makers. A bigger knowledge and better understanding of emerging practices is needed to create appropriate policies and to encourage the industry. This is the reason to why OECD and Nordic Innovation are both conducting business case studies in this area.



Driven by market trends

Kristian Henriksen, FORA, presented the project on Green Business Model Innovation in the Nordic countries, supported by Nordic innovation. Besides from investigating green business models, the project is also addressing policy and policy anchoring, conceptualization, case studies, effect studies and tools for companies.


- Preliminary results show that green business model innovation happens across size and or sector, but that only few companies focus their innovation both upstream and downstream. Eco-innovation is also highly driven by market trends, a way for companies to create competitive advantages and increase growth, Henriksen said.


Erik, Freudenthal, Communication Manager at GlashusEtt, presented Hammarby/Sjöstad, a unique environmental project in Stockholm where an industrial area has been transformed into a modern sustainable city area with synergy as the keyword.


- Combustible waste is incinerated; purified waste water is used as heat. We have a well-functioning public transport system and a carpool. These are some of the things that make it to lower the total environmental impact by half for the 26.000 people living in the area.


The extra costs for the developers are 2-4 % compared to standard.


- In a long run the costs are smaller. But to make projects like this a reality, a political will is needed as well as a general change of thinking among people, Freudenthal said and added that there actual are more similar projects in Stockholm going on at the moment: Norra Djurgårdsstaden and Järvalyftet.



Digital ecologisation

Juha Lipiainen is Chief Operating Officer the project DigiEcoCity, a Finnish/Chinese cooperation.


- The most environmentally friendly building is a building never being built. By combining economy and ecology, digital communication can change the cities of the 21st century.


DigiEcoCity combine digital innovations with an environmental consideration. The digitalization is being thought into an empty city, which means that the planning of the city can be adapted to this.. High speed connectivity enables online building maintenance and management services.


In China two DigiEcoCity-areas for 150.000 inhabitants are being planned at the moment.


- Digital and ecological solutions are global: What works in the Nordic countries works in China as well. Energy saving is the key issue to China’s economical growth, and it is fact that China’s choices have a global impact, he said.


Cradle to cradle in the shipping industry

Jacob Sterling, Head of Climate and Environment at Mærsk, stated that environment regulation and stakeholder demands are diversifying and the question for firms is whether to have a reactive or proactive approach to the existing challenges. Mærsk decided to step into the environmental performance competition by buying so called triple-E vessels with more capacity, a lower CO2-submission and designed for slow steaming recovered with waste heat.


- Our aim is to set new shipping standards, he said and added that another problem for the shipping industry is slowly running out of steel.


- Recycling and reuse of steel is the key to sustain business. The concept is cradle to cradle, which means that waste is eliminated by using materials that are biodegradable or used for making new products.


Patrick O’ Riordan, DG Enterprise and Industry at European Commission, presented the EU 2020 Flagship Projects with the keywords smart growth (innovation, education and digitalization), sustainable growth (industrial policy, climate and energy) and inclusive growth (employment and skills, fighting poverty).


- It is crucial that these keywords are taken into consideration on all levels; regional, national and global.



EU actions

Aurelio Politano, DG Environment at European Commission, presented the EU Eco-Innovation Action Plan, and listed seven actions which are highly relevant to the creation of new green business models.


  • Environmental policies and regulations for promoting eco-innovation
  • Demonstrating projects and partnerships for eco-innovation
  • Standards and performance targets to reduce environmental impact
  • Finance and support services for SMEs
  • International cooperation
  • New needs when it comes to skills and jobs
  • European Innovation Partnerships