The Challenge
Recent reports indicate a cause for concern: Europe risks losing its competitive edge in low‐carbon industries. While some argue that climate action may be sapping economic momentum, the real concern is that green investment and sustainable business innovations are lagging. In Finland, the mandate to boost R&D investment to 4% of GDP by 2030 is a positive step—but success hinges on directing this funding toward initiatives that foster true business renewal and sustainable growth, not merely new technologies for technology’s sake.
Market-Centric Renewal in Focus
Traditionally, innovation in Finland has long emphasized technological and production-driven approaches. Moreover, in today’s low-carbon era, economic resilience requires a shift. Instead of isolated tech breakthroughs, Finnish businesses must adopt market-centric capabilities that align R&D and sustainability with real market needs. This approach ensures that innovations deliver both economic value and sustainable impact, paving the way for greener investments and enhanced competitiveness.
The Role of Intermediaries
Key to this transformation are the intermediary organizations—funding bodies, R&D institutions, and policy actors—that can drive systemic change. These intermediaries can navigate complex institutional logics and promote practices that address real-world challenges. Their aligned efforts can help translate increased R&D investment into actionable strategies, ensuring that sustainability becomes an integral part of business renewal rather than an add-on.
Looking Ahead: Institutional Transformation for a Low-Carbon Future
This research aims to uncover actionable strategies for Finnish business renewal by focusing on how intermediaries navigate institutional logics and promotie meaningful transformation. The goal is to catalyze green investment by aligning policy, research, and market needs—creating a sustainable ecosystem that not only meets the 2030 R&D targets but also secures a competitive advantage for Finland in the global low-carbon economy.
About the Researcher
Fares Georges Khalil is a postdoctoral associate researcher at Hanken School of Economics. In 2024, he received funding from the Foundation for Economic Education (Liikesivistysrahasto) for his project “Catalyzing System Transformation and Renewal—Institutional Shifts in R&D, Policy, and Business Fields.” His work explores how intermediary roles and market-centric innovation can drive systemic change, ensuring that increased R&D investment translates into sustainable growth and renewed competitiveness for Finnish businesses.
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PhD Fares G. Khalil Hanken received a grant of €30 000 from Liikesivistysrahasto for his project Catalyzing System Transformation and Renewal – Institutional Shifts in R&D, Policy, and Business Fields. [https://about.bnef.com/blog/global-investment-in-the-energy-transition-exceeded-2-trillion-for-the-first-time-in-2024-according-to-bloombergnef-report/]