10 December 2014 in Lisbon, Portugal
Innovation has long been one of the key areas for Euro-CASE. The Innovation Platform that was established in 2011 has conducted, until today, five meetings and has been continuously working on drafting policy papers on various relevant topics related to innovation. During the runtime of the Platform it became obvious that despite excellent research that is being conducted all across Europe, it seems difficult to capitalize on the results in form of marketable products. This situation of excellent research results and little economic exploitation has become known as the European Paradox. Other regions in the world, most notably the US but also dynamic countries in Asia, are much more prone to entrepreneurial activities and economic exploitation of research results. On average, Europe is doing well when it comes to producing goods with medium-high technological content but falls short when considering manufacturing of high-tech products. These perspectives led to the decision to organize this year’s Euro-CASE Annual Conference on the topic “Boosting Innovation in Europe: EU-USA – Why the innovation gap?”
Opening Ceremony and Conference Program
The Annual Conference was convened by the Portuguese Academy of Engineering (Academia de Engenharia) and took place in the magnificent surroundings of the historic Palácio Foz in Lisbon, in the presence of about 90 invited guests. The event was opened by keynote speeches by Fernando Santana, President of the Portuguese Academy of Engineering, followed by Reinhard Hüttl, Chairman of Euro-CASE and the honourable Minister of Education and Science of Portugal, Nuno Crato.
The first session, chaired by Manuel Carrondo, member of the Portuguese Academy of Engineering, was devoted to the topic “Filling the gap through innovation”. The participants largely agreed with the opening statements that the main difference in innovation between the EU and the US can be found in cultural aspects mainly regarding the culture of risk taking. Especially, creation and disappearance of SMEs and the ways the society deals with successes and failures, are noticeable differences.
In his speech “Promoting Corporate Innovation in Portugal” Professor João Bento, President of COTEC (Association of Enterprises for Innovation) Portugal, pointed out to the fundamental importance of the EU when it comes to comparative data. He also emphasised that many of the advances in terms of innovation in Portugal have been swept through the devastating financial crises over the recent years.
Jan Marco Müller, Assistant to Anne Glover, Chief Scientific Adviser to European Commission’s President José Manuel Barroso, also concurred that culture matters and highlighted the differences in risk perception, taking as an example genetically modified crops. Actors across the EU do produce excellent scientific results but should be considering the risks also in relation to potential rewards.
Ulla Engelmann, Head of Unit for Stakeholder Relations of the Joint Research Centre (JRC), introduced the activities of the JRC and its similarities to Euro-CASE when it comes to science-based policy advice. Just as Mr. Müller, she highlighted the qualities of European research. She also underlined the fact that there are countless research cooperation between the US and the EU. For the EU level the most important present areas for cooperation are E-Mobility and Smart Grids.
In the following lively discussion participants mentioned the main differences in the areas of creativity and research, intellectual property, diversity across Europe, and culture. The latter was also emphasised by Euro-CASE chairman R. Hüttl who claimed that social acceptance of modern technologies is also driven by communication. Scientists in Europe should be more open towards the public as they are also dependent on marketing their own respective research. He also claimed that scientists might need some time to adapt to their new role but there are high rewards to be expected as, for example, the dialogue forum in the German academies’ project “Energy System of the Future” clearly shows. When it comes to science- and technology-based policy advice, scientists should be thinking more in terms of policy options rather than conclude in simplistic recommendations.
The innovation gap can be filled by extensive training of people for business creation, strengthening the entrepreneurial culture in companies, continuing to build trust between politics and business sectors and to make use of the diversity in the EU. It was emphasised that Europe must be careful not to exaggerate the role of the state when it comes to economic research activities.
The afternoon session, chaired by W. Wakeham, Senior Vice President, Honorary Secretary for International Activities, Royal Academy of Engineering, started with an outline of the discussion paper “Boosting Innovation in Europe: USA-EU – Why the innovation gap?, Horizon 2020 – How to boost Innovation?”, by Maria Paula Diogo, New University of Lisbon. Following that introduction Björn Nilsson, Chair of the Euro-CASE Innovation Platform and President of the Royal Swedish Academy of Engineering Sciences, introduced the Euro-CASE Innovation Platform and the Global Entrepreneurship Monitor. The latter indicates that the gap is closing but there continue to be large differences in terms of entrepreneurship attitudes and especially the fear of failure which is considerably higher in the EU than in the US.
Ian Ritchie, Honorary Treasurer, Royal Academy of Engineering, provided a detailed overview of the differences in the provision of venture capital. The financial crisis almost led to a collapse of the venture capital system in the EU which, in turn, led to an increase in public funding schemes that are neither able to contribute to growth nor to help ailing SMEs. The question remains why European SMEs can’t grow big (such as e.g. Amazon, Facebook, etc.). During the discussion the participants largely agreed that in the EU there should be put more emphasis on tax incentives and co-funding and less focus on firm survival.
In his speech on funding mechanisms Manuel Heitor, former Secretary of State for Science in Portugal, seized the opportunity to call for more public expenditures on R&D. Except for Germany and the Nordic Countries, Government expenditures on R&D are shrinking in Europe due to the financial crisis with negative consequences for European innovation systems. During the following discussion it was mentioned that business expenditures of R&D are equally if not more important for innovation and that different framework conditions among EU member states need to be taken into account.
While during the Panel discussion, Dominique Peccoud, member of the NATF, provided valuable input to the paper by Maria Paula Diogo, Jean-Louis Migeot, President of the Royal Academy of Belgium (ARB), claimed that an entrepreneurial spirit is missing in Europe. Public incentives and support programs do not help to overcome the gap in terms of risk taking. Also social acknowledgement of entrepreneurial undertakings is lacking. SMEs should be given a much more prominent role in EU funded research projects. Much more efforts are necessary in terms of education and cultural change to strengthen the entrepreneurial spirit.