Leveraging Physical Assets for Value Creation Through Cleanweb Firms - The Finnish Cleantech Space in Transition

32 Pages Posted: 29 May 2015

See all articles by Annu Kotiranta

Annu Kotiranta

ETLA, Research Institute of the Finnish Economy

Antti Tahvanainen

ETLA, Research Institute of the Finnish Economy

Maria Ritola

Bank of Finland

Peter Adriaens

The Stephen M. Ross School of Business at the University of Michigan

Date Written: May 2015

Abstract

Cleantech has made a respectable comeback onto the global agenda of firms, investors and economic developers alike. In the midst of the resurgence, Finnish CleanTech has been recognized globally. Indeed, recent rankings placed Finland in the top-3 of global leaders in cleantech, along with Israel and the US. This paper takes a closer look at the Finnish commercial cleantech space and scrutinizes it in light of select indicators such as degree of specialization into cleantech, type of industrial activity, generation of value added, financial performance as well as type and volume of intellectual property generated. Three insights stand out: First, the Finnish cleantech space is dominated by manufacturing-driven businesses. Second, consumer-oriented technical innovations seem to be rare. And third, the engine of industrial renewal – the small and medium-sized firms – appears to struggle with financial sustainability. The ability to shift gears from manufacturing- to service-driven businesses may be compromised if the low financial viability of small and medium sized companies turns out to be more than a statistical anomaly. These firms have the capacity to transition conventional industry boundaries to develop novel business models and open new markets. Poor financial performance would impact long-term development of the cleantech space in Finland. Given the central role of information technology in cleantech 3.0 businesses, there is an opportunity to leverage the innovative capacity of the Finnish ICT industry to: (a) accelerate the adoption of green solutions, (b) drive economic growth, and (c) render cleantech companies not only profitable, but also attractive investments.

Keywords: Cleantech, cleanweb, industrial renewal, digitalization, Finnish economy

JEL Classification: L16

Suggested Citation

Kotiranta, Annu and Tahvanainen, Antti and Ritola, Maria and Adriaens, Peter, Leveraging Physical Assets for Value Creation Through Cleanweb Firms - The Finnish Cleantech Space in Transition (May 2015). Ross School of Business Paper No. 1279, Available at SSRN: https://ssrn.com/abstract=2611231 or http://dx.doi.org/10.2139/ssrn.2611231

Annu Kotiranta (Contact Author)

ETLA, Research Institute of the Finnish Economy ( email )

Lönnrotinkatu 4 B
Helsinki, 00120
Finland

Antti Tahvanainen

ETLA, Research Institute of the Finnish Economy ( email )

Lönnrotinkatu 4 B
Helsinki, 00120
Finland

Maria Ritola

Bank of Finland ( email )

P.O. Box 160
Helsinki 00101
Finland

Peter Adriaens

The Stephen M. Ross School of Business at the University of Michigan ( email )

701 Tappan Street
Ann Arbor, MI MI 48109
United States

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