Metsä Group's role as an innovator and promoter of sustainable bioeconomy has expanded in recent years. Among others, the government's bioeconomy strategy and the progress of Metsä Group's bioproduct mill investment have boosted discussion about new and developing bioeconomy solutions.
Metsä Group invited important bioeconomy researchers and developers to a roundtable event to discuss the sector's growth potential. We have shared goals: to utilise Finnish wood-related know-how more extensively and to create successful bioeconomy solutions.
Metsä Fibre's CEO Ilkka Hämälä opened the discussion by reminding the participants that the continuous development of existing processes is also a form of innovation. The Group's SVP Sustainability and Corporate Affairs Riikka Joukio gave a presentation on Metsä Group's research and development themes: circular economy, efficient use of resources and the utilisation of renewable raw materials.
Researh and development in bioeconomy needs closer networks
Nils Torvalds, a member of the European Parliament, told us that bioeconomy, technology and sustainable use of forest are also hot topics in European decision-making. According to Torvalds, Finnish MEPs need to provide other MEPs with facts about Finnish sustainable forestry, so that the reference levels and flexibility of the proposed Land use, land-use change and forestry (LULUCF) regulation are defined in a way that takes into account both the Finnish industry and the European economy.
"Companies' input and practical examples play a huge role in bioeconomy-related decision-making," said Ilona Lundström from the Finnish Ministry of Economic Affairs and Employment. She pointed out that there seem to be fairly few company representatives in Europe who would be interested in actively participating in the EU discussion by talking about their industry and its contributions to a sustainable future.
Another topic that Lundström stresses is know-how and education. "At the moment, 40 to 44-year-olds are the most educated age group in Finland. The level of education among the younger age groups has lowered. Our strongest assets are the competences due to the high-level education which we have to ensure also in the future."
Lundström also talked about the importance of sharing knowledge between people. “Earlier, we mainly had domestic and business area dedicated research and development networks. Nowadays, the business as well as research and development networks are global and the structure of cooperation has evolved. We need to rediscover the way to fruitfully innovation.”
Earlier, the networks between business people used to be tighter, but as a result of globalisation remote management and teamwork have become everyday occurrences. "There are a lot of active and functional development units around Finland and the world, but the members are spread out. This limits the information flow and results in hubs of know-how that are distant from each other.
Lundström calls for closer networking and concrete cooperation between partners in order to create new innovations. In her opinion, funding should be provided to companies of all sizes – also to the big industrial companies who often play a major role in the functioning and development of ecosystems.
Funding of R&D and commercial relevance
"Companies of all sizes have their own place in ecosystems, but it takes some industrial relevance to turn research into commercial products," noted Janne Laine, the dean of Aalto University. He stressed the importance of industrial actors' commitment to research and development and active participation in development activities. "Industrial-scale actors provide the large volumes and power needed to create commercial solutions," he says.
Janne Laine highlighted the importance of teamwork. Audience: Niklas von Weymarn from Metsä Fibre, Alina Ruonala-Lindgren from the Finnish Forest Indutries, Markku Leskelä from Metsä Board, Jussi Manninen from VTT, Mika Lautanala from Tekes, Jari Haapanen from Aqvacomp and Olli Laitinen from Metsä Forest.
Laine also talks about the challenges in increasing expertise. One of them is that foreign talents find it very difficult to get employed by Finnish companies. "There are a lot of skilled, ambitious young people who come from abroad to study here. But if they do not speak Finnish well, it is very difficult for them to find employment. In the future, I would like to see businesses taking a role in solving this challenge,” says Janne Laine.
The CEO of VTT Technical Research Centre of Finland Ltd Antti Vasara said that when you're talking about the big picture, there are always parties for whom financing is the most interesting topic.
“On the other hand, companies are always interested in being able to create products that are successful and better than before. The goal should be exceptional excellence.”
In terms of financing, there is demand for higher investment risk tolerance. Research Institute of the Finnish Economy ETLA’s Antti Tahvanainen describes international research projects where the criteria for funding may involve a risk limit as high as 85%. "These high-risk projects are the ones that result in true, brand-new innovations," he explains.
Added value through developing new and strong brands
Companies are looking for growth potential in different phases of the value chain. A good example was the question posed by Jyrki Ali-Yrkkö from ETLA: Who is the biggest forest owner in Romania? "It's IKEA. They have expanded their operations from retail to manufacturing wooden furniture as well as owning raw materials. Companies are making strategic decisions regarding their place in the value chain."
"From a value creation perspective, the development of new products and increasing the value of the brand in the eyes of the end users are key activities. A comprehensive view of the value chain and close contact with the end users increase the number of value creation opportunities," Ali-Yrkkö concludes.
According to Ali-Yrkkö, the parts of a value chain that are highly competitive and have efficient working methods established do not necessarily produce a lot of added value – in these cases, value is created through a large volume.
This event, focusing on research and development, was the third Metsä Group roundtable. Earlier subjects covered in this series of discussions have been
Promoting bioeconomy and the future of bioeconomy in Finland and the EU (September 2015) and
The growth of bioeconomy and the sustainability of natural resources (May 2016)
The series of discussions will continue in the future.