What is Sustainable Innovation? Professor Lassi Linnanen October 20, 2011

(Rockström et al. 2009) Planetary Boundaries

The Biological Analogy

Eco-efficiency vs. Sustainable development Eco-efficiency Sustainable development New structural solutions New functional solutions Improvement of the Current products

Ambition Levels (Non-Compliance) Beyond Compliance - Eco-Efficiency Integrated Strategy - Business opportunities Purpose/Mission - Align with core values Compliance - Regulatory Demands and Enforcement Space for Innovation

Transition of Socio-Technical Regimes (Geels 2003)

Transition Framework for Sustainable Nutrient Economy

Dependency of Systems Natural System (resources) Social System (citizens and institutions) Economic System (markets)

Global Trends: Tomorrow’s Markets −Expanding population in developing regions will create large markets dominated by the young −Global wealth is rising but the income gap grows wider −Millions are malnourished amidst an abundance of food −Life expectancy rises, yet preventable disease contributes to limit development −Primary education is widespread, but opportunities for learning elude many

Global Trends: Efficiency and Energy −Rising consumption creates environmental risks and business opportunities for innovation −Escalating demand for energy propels economic development but threatens Earth’s climate −Pollution remains a global challenge −Throughput still grows even as energy and materials efficiency improves

Global Trends: Natural Capital −The productive capacity of the planet is in decline −Food production is the basis of many economies but threatens the ecosystems upon which it depends −Freshwater is growing scarce amidst competing human needs

Global Trends: Connections −Urban growth concentrates business opportunities and societal challenges −Humans are more mobile, accelerating the flow of goods and knowledge and raising demand for energy and infrastructure −Access to information and communication technologies enables economic opportunity −As economies become service-based, women are a growing part of the formal labor force

Global Trends: Roles and Responsibilities −Democracy spreads, creating improved conditions for market-based economies −Civil society is demanding greater accountability and transparency from government and business −Private sector investment is increasingly financing economic development

Landscape Tomorrow’s Markets Efficiency Natural Capital and Energy Connections Roles and Responsibilities Regime Enablers / Disablers Capabilities Resources Motivation Actors Public Sector Businesses Civil Society Niches STI Innovation DUI Innovation Natural System (resources) Social System (citizens and institutions) Economic System (markets) Mode 2 knowledge production -> DUI-mode of innovation Mode 1 knowledge production -> STI-mode of innovation Context of knowledge application (companies and public sector organizations)

−System innovation for sustainable development differs sharply from traditional ”national competitiveness” innovation policies −Basic economic, technical and social systems exist but current programs clearly inadequate −Balancing the tension between desire to secure economic benefits and need to maximise technology diffusion −Priority to critical natural cycles: carbon, nitrogen, phosphorus Some Concluding Remarks