A global index developed by research firm Cleantech Group of the most nourishing environments for clean technology companies shows that Denmark – famous for fjords, beer and the scene of Prince Hamlet’s demise – has created a home where clean tech companies are most likely to thrive.
In creating its Global Cleantech Innovation Index, the group looked at “general innovation drivers,” defined as supportive government policies, public research and development budgets and available private money, as well as other factors. In addition, Clean Tech analyzed the outputs of innovation: “what’s actually happened.” That includes its own proprietary venture capital data, environmental patents, commercialized clean tech innovation and clean tech company revenues.
Unsurprisingly, North America and Europe dominate based on those factors, explained Richard Youngman, managing director at Clean Tech for Europe & Asia, who spoke on a panel on the group’s findings last week. The top countries behind Denmark were Israel, Sweden, Finland, the United States and Germany.
“Interestingly, the higher ranks of the overall Global Cleantech Innovation Index are dominated by small countries, which represent concentrated potential to produce their ‘fair share’ (and then some) of the innovative companies to take the global economy forward on a more sustainable basis,” the report states. “As home to three of the four top countries, Scandinavia emerges as a clear regional ‘winner.’ Its small, innovative countries are followed by the larger economies of the USA and Germany.”
When accounting for the size of various countries’ economies, Denmark noses ahead because the drivers of innovation in the country are specific to clean-tech companies both commercialized and emerging. Many countries scored well on either commercialization or start-up environment, but not both, as Denmark did.
In addition to the countries at the top, Clean Tech Group gave honorable mention to both China and India because of their potential to rise in the index during the next several years.
“They are already strong centers for the production of clean-tech products and have increasingly supportive governments, large sums of private money ready to be invested, and massive domestic markets,” the report states. “Signs suggest that in the near future these countries have many of the favorable ingredients to be not only manufacturing clean-tech products, but founding, and being home to, more and more of the next generation of innovative clean-tech companies.”
Another interesting finding in the report was the prevalence of smaller economies propelling both clean tech commercialization and innovation. Canada as a country, for example, isn’t keen on the concept of climate change, but the state of Ontario “is a huge progenitor of innovation,” said Youngman.
The same was true in Ireland and Korea. In Korea, however, there is strong support from government leaders that fosters clean tech innovation, and a likely result is the high rate of patents registered from the country, he noted.
Innovation “laggards” the index identified included Russia, Greece, Turkey and Saudi Arabia.
To read the full report by the Cleantech Group, click here