2006 Taipei – Innovation for Sustainable Development
The objective of innovation policy, particularly in this era of globalization, is to contribute to the economic development and growth of nations, and through this to improve the quality of life and the standards of living of the citizenry;
Substantial commercial, economic and social benefits can flow from innovation, such as improvements in the range, quality and cost of existing goods and services, including the creation of new industry, generation of new employment and identification/development of new international trade opportunities;
An innovation policy for sustainable development requires a broader policy framework that:
- Ensures businesses are not impeded in their search for innovations which improve competitiveness, quality and service;
- Provides appropriate government support for research and development (R&D) and networking activities, the creation of innovative environments and the promotion and development of industry‐university‐R&D institution partnerships that yield benefits to the community;
- Ensures a proper system of legal protection for intellectual property rights through awareness and enforcement; and,
- Removes unnecessary barriers to the international and national flow of ideas, technology and people.
Innovation policy should focus primarily on creating an environment in which new ideas are generated and may be translated into new products, services and processes by the private sector. This means innovation policy settings should:
- Be integrated into a nation’s broader economic development and growth policies;
- Be implemented as part of a holistic government approach;
- Recognize the special needs of small and medium enterprises;
- Ensure public funding of R&D in universities and research institutions as a recognition of both the importance of industry focused applied research and the need for general ‘pure’ research;
- Emphasize cooperative approaches to innovation;
- Develop human capital through education and training;
- Promote protection and optimize the potential of Government funds invested in R&D of technology by allowing intellectual property right to the inventor even in Government funded R&D institutions, thereby, promoting commercialization of IP generated out of Government R&D.
Business success in innovation, and through it, national economic development and growth, requires a culture of innovation to exist within entrepreneurial local businesses. The capacity to innovate by firms requires several essential qualities:
- Imagination concerning new products, services or processes (either through new applications or through entirely new products, services or processes);
- The capacity to optimally use of the external environment and to take on board new knowledge and skills;
- The ability to manage a project successfully through to market; and the need for R&D outputs to be adequately protected and for efforts to maximize its commercialization.
- A business and social culture that encourages and rewards risk taking.
Forming and leading business culture and attitudes is primarily the responsibility of corporate leaders, at both board and senior management levels.
Even if individual businesses in developing nations prove successful as innovators, it will likely remain the case that the vast majority of the world’s new ideas and products will be developed elsewhere in the world.
Ensuring developing countries in particular have reasonable access to the benefits of those innovations will be even more important for their economic development and growth than the ideas and products they may develop themselves.
The flow of these ideas and products to developing countries can take several forms, for example, through:
- The international exchange of pure research results, knowledge and ideas;
- The liberal exchange of goods and services which embody innovation;
- Technology transfer embodied in new investment and new production processes; and,
- The international movement of skilled and experienced personnel.
- Development of a market for trade and intellectual property
CACCI recognises the nature and extent, if any, of government intervention in the innovation process is a matter of considerable debate in development and industry policy circles. Taken as a whole, CACCI suggests the government to provide support and activities to facilitate the creation of innovative environments and the improvement of R&D activities in industry, universities, and R&D institutions.
CACCI considers where government assistance is provided to facilitate innovation it should not involve ‘picking winners’ but be open to all businesses irrespective of size, sector, location, export focus or other commercial characteristics.
The better, and preferred, approach is for governments to implement, after consultation with the private sector, macro‐economic and micro‐economic policies conducive to trade and investment including: sound monetary policy; maintenance of a structural budget surplus; a taxation system which does not discourage trade or investment, particularly venture capital; the removal of tariff and non‐tariff barriers to trade; the promotion of international competition and technological development; and the removal of legislation or regulations that constitute a barrier to innovation.
As the private sector has been consulted in the development of the macro and micro economic policies, it is then prepared for the possible impact on its operations of such policies including agreed procedures for providing feedback.
A public‐private sector partnership should serve as a structure to monitor and communicate on the implementation, and impact, of the micro‐ and macroeconomic policies on the innovation capabilities and outputs of the private sector.
Such a structure would also provide feedback in a timely manner to the government, through the public sector members, so that the government policies may be revised and enhanced as needed.
