1. www.wiseguys.ltd.uk Innovation and Environmental Policies for Sustainable Development oKen Guy oWise Guys Ltd. oSix Countries Programme Conference oBrussels oFebruary 28 - March 1, 2002

2. www.wiseguys.ltd.uk Introduction

3. www.wiseguys.ltd.uk Introduction oKey issues concerning innovation policy, environmental policy and sustainable development

4. www.wiseguys.ltd.uk Introduction oKey issues concerning innovation policy, environmental policy and sustainable development oWhat can innovation policy do for sustainable development?

5. www.wiseguys.ltd.uk Introduction oKey issues concerning innovation policy, environmental policy and sustainable development oWhat can innovation policy do for sustainable development? oWhat can environmental policy do for innovation?

6. www.wiseguys.ltd.uk Policy Spheres Industrial Policy Environmental Policy Sustainable Development Policy Innovation Policy Innovation Policy for Sustainable Development

7. www.wiseguys.ltd.uk Definitions

8. www.wiseguys.ltd.uk Definitions oThe aim of industrial policy is to promote economic well-being

9. www.wiseguys.ltd.uk Definitions oThe aim of industrial policy is to promote economic well-being oThe aim of environmental policy is to promote environmental well-being

10. www.wiseguys.ltd.uk Definitions oThe aim of industrial policy is to promote economic well-being oThe aim of environmental policy is to promote environmental well-being oThe aim of sustainable development is to maximise environmental productivity and efficiency within economic production processes

11. www.wiseguys.ltd.uk Definitions oThe aim of industrial policy is to promote economic well-being oThe aim of environmental policy is to promote environmental well-being oThe aim of sustainable development is to maximise environmental productivity and efficiency within economic production processes oThe aim of innovation policy is to encourage changes in the amount, rate and direction of innovation - but only if externalities apply

12. www.wiseguys.ltd.uk Innovation Policy

13. www.wiseguys.ltd.uk Innovation Policy oFrom additionality and competitiveness to broader socio-economic goals

14. www.wiseguys.ltd.uk Innovation Policy oFrom additionality and competitiveness to broader socio-economic goals oBut has innovation policy worked?

15. www.wiseguys.ltd.uk Innovation Policy oFrom additionality and competitiveness to broader socio-economic goals oBut has innovation policy worked? oYes at one level, dont know at another

16. www.wiseguys.ltd.uk Innovation Policy oFrom additionality and competitiveness to broader socio-economic goals oBut has innovation policy worked? oYes at one level, dont know at another oBut our increased understanding of how innovation systems work provides us with a few a policy tips

17. www.wiseguys.ltd.uk Policy Tips

18. www.wiseguys.ltd.uk Policy Tips oPolicy intervention should target the weakest links

19. www.wiseguys.ltd.uk Policy Tips oPolicy intervention should target the weakest links oIndividual policy instruments are unlikely to have a dramatic impact on system performance

20. www.wiseguys.ltd.uk Policy Tips oPolicy intervention should target the weakest links oIndividual policy instruments are unlikely to have a dramatic impact on system performance oHence the need for a broad policy mix

21. www.wiseguys.ltd.uk Policy Tips oPolicy intervention should target the weakest links oIndividual policy instruments are unlikely to have a dramatic impact on system performance oHence the need for a broad policy mix oAnd a system of strategic intelligence to help formulate the mix

22. www.wiseguys.ltd.uk A Simple Innovation System

23. www.wiseguys.ltd.uk More Tips

24. www.wiseguys.ltd.uk More Tips oAll parts need to interact well if the system is to function smoothly

25. www.wiseguys.ltd.uk More Tips oAll parts need to interact well if the system is to function smoothly oStimulating knowledge creation in the private sector is vital but difficult

26. www.wiseguys.ltd.uk More Tips oAll parts need to interact well if the system is to function smoothly oStimulating knowledge creation in the private sector is vital but difficult oS&T education and training is needed to improve social capital and absorptive capacity

27. www.wiseguys.ltd.uk More Tips oAll parts need to interact well if the system is to function smoothly oStimulating knowledge creation in the private sector is vital but difficult oS&T education and training is needed to improve social capital and absorptive capacity oLinking or bridging strategies have become increasingly important

28. www.wiseguys.ltd.uk A Simple Policy Classification Scheme Public SectorPrivate Sector Knowledge Users Knowledge Creators Reinforcement Policies Bridging Policies

29. www.wiseguys.ltd.uk Summary of Simple Tips oBase policy prescriptions on strategic analysis of weak nodes in innovation systems oTackle these weaknesses via broad policy mixes oInclude measures which strengthen human resources oInclude bridging measures aimed at improving knowledge and information flows oExperiment, evaluate and feed back strategic intelligence

30. www.wiseguys.ltd.uk Environmental Policy

31. www.wiseguys.ltd.uk Environmental Policy oFocus on the interaction with technology development, innovation and economic well-being

32. www.wiseguys.ltd.uk Environmental Policy oFocus on the interaction with technology development, innovation and economic well-being oEvidence that regulatory change can stimulate relevant technological change - though change is often incremental and slow

33. www.wiseguys.ltd.uk Environmental Policy oFocus on the interaction with technology development, innovation and economic well-being oEvidence that regulatory change can stimulate relevant technological change - though change is often incremental and slow oMany traditional instruments also successful, e.g. R&D programmes, though under-critical and too short-term

34. www.wiseguys.ltd.uk Environmental Policy oFocus on the interaction with technology development, innovation and economic well-being oEvidence that regulatory change can stimulate relevant technological change - though change is often incremental and slow oMany traditional instruments also successful, e.g. R&D programmes, though under-critical and too short-term oBut high barriers to innovation in many environment-related areas

35. www.wiseguys.ltd.uk What Can Innovation Policy Do for Sustainable Development?

36. www.wiseguys.ltd.uk What Can Innovation Policy Do for Sustainable Development? oApply a broad policy mix

37. www.wiseguys.ltd.uk What Can Innovation Policy Do for Sustainable Development? oApply a broad policy mix oUK study recommended a mix which included: oTarget setting oFinancial support oSupport for environmental R&D oSupport for the training of researchers oPrizes for innovations which reach environmental objectives oTax incentives for environment-friendly innovations oA National Environment facility to manage and channel environmental innovation oPolitical and corporate leadership and clear statements of intent

38. www.wiseguys.ltd.uk What Can Innovation Policy Do for Sustainable Development? oApply a broad policy mix oUK study recommended a mix which included: oTarget setting oFinancial support oSupport for environmental R&D oSupport for the training of researchers oPrizes for innovations which reach environmental objectives oTax incentives for environment-friendly innovations oA National Environment facility to manage and channel environmental innovation oPolitical and corporate leadership and clear statements of intent oCombat uncertainty and ignorance about correct policy prescriptions with experimentation and evaluation

39. www.wiseguys.ltd.uk What Can Environmental Policy Do for Innovation?

40. www.wiseguys.ltd.uk What Can Environmental Policy Do for Innovation? oMuch current innovation policy is geared to improving the quality of stocks and flows within innovation systems

41. www.wiseguys.ltd.uk What Can Environmental Policy Do for Innovation? oMuch current innovation policy is geared to improving the quality of stocks and flows within innovation systems oBut there is still scope for quantity measures, especially in terms of stimulating R&D expenditure in the private sector

42. www.wiseguys.ltd.uk What Can Environmental Policy Do for Innovation? oMuch current innovation policy is geared to improving the quality of stocks and flows within innovation systems oBut there is still scope for quantity measures, especially in terms of stimulating R&D expenditure in the private sector oCombining regulatory measures with traditional innovation policy instruments could overcome inertia in areas where environmental and profit motives will eventually coincide