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Grasping the challenges of our time
The mission of the Environmental Programme was to increase environmental technology and know-how business operations and networking on the international market, as well as to seek new solutions to broaden the funding base in the sector.
Sitra began surveying the status of environmental technology companies and supporting them, as concern over climate change and the state of the environment had boosted interest in environmental know-how and technology. However, Finnish companies’ growth in the early part of this decade had been modest. Businesses and services based on environmental know-how – particularly clean technology – were seen as a significant factor in fending off climate change. Environmental technology and businesses are expected to be the largest growth sector of this century. As a highly-educated nation with technological know-how, Finland should play an active role in this development.
Reacting to messages from the field
From a global point of view, Sitra’s Environmental programme began at just the right moment. In North America in 2005, the flow of venture capital into clean technology companies rose by 35 per cent. It was time to find out what was really happening in the sector and how Finland could participate in the growing environmental technology sector. In the early years of this decade, annual growth in the field in Finland was only about 3 per cent. However, the strong growth prospects in the sector began to be noticed in Finland, as elsewhere.
The Environmental Programme was a response to the needs of investors and companies. In 2006, when Sitra surveyed the turnover of 300 SME’s in the sector, it found that growth from the previous year had been an impressive 18%.
Spreading the word about environmental growth prospects
During the period of the Environmental Programme, Sitra studied the growth outlook for growth in the field in Finland and presented the results to business and public administration leaders. As the Programme ended, the Confederation of Finnish Industries was establishing an environmental forum to bind the sector together and begin building the Cleantech Finland® brand.
The Finnish Government’s agenda for 2007-2011 notes that as Finland manages of its own climate policy, it should claim its share of the world’s climate technology markets and the jobs they are creating. Investors have also recognised environmental technology and services as growing business areas. In February 2007, various organisations in the environmental sector released a joint action programme called Cleantech Finland – boosting environmental business. This set as a target a doubling of turnover in the field by 2012. At the same time, it established the Cleantech Finland® trademark under which companies can market their cleantech know-how.
Networking onto the global markets
To support the internationalisation of companies in the environmental sector, the programme set up networks in the Baltic region, Russia, China and the USA. As expected, China has proved to be a challenging market over several years of effort. These are continuing with support from the Finnish Environmental Cluster for China (FECC).
A joint project by Sitra and Tekes (the Finnish Funding Agency for Technology and Innovation) in the US led to business deals for several companies, concrete negotiations on new projects as well as continuation of work by Finnish-American firms.
The networking of innovative Finnish SME’s and their entry into international markets was advanced by surveying available know-how and arranging corporate meetings.
Investors focusing on cleantech
The commercialisation of environmental technology requires capital. While the programme was running, Sitra made investments while also seeking new financing arrangements for this sector. In late 2007, the basis for long-term capital funding was created as Sitra and one of Sweden’s leading capital investment groups, Provider Venture Partners AB, reached an agreement on preparations for a cleantech fund. If and when this fund begins operations, it would operate at first in Finland and Sweden. It would then aim to expand to include all the Nordic countries. Sitra is carrying on its own investments in the environmental sector, both through direct capital investments and through various funds.
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