Real impact is created in holistic business ecosystems

Opinion 17.06.2019

After the latest IPCC report was released in 2018, the urgent need to come up with solutions that limit global warming to 1,5°C has become more widely understood. Cities will be the forerunners in creating and implementing of these solutions. They suffer from some of the most severe problems linked to climate change, but also have the potential to offer the best solutions, thanks to their concentration of talent and various actors.

What is crucial to understand is that the real impact comes from ecosystems, not from single solutions. And if we want to ensure real impact, we have to think holistically about the necessary changes in how we live, move, or consume in cities.

Single innovations in mobility (like MaaS) or in built environment (like remote controlling the electricity consumption in your apartment) can be commercial successes on their own. However, the impact on CO2 emissions comes from changing entire systems: the way we move people and goods, the way we construct, renovate and live in our buildings, and how we use energy.

People understand the urgency and necessity of taking action. The structures and tools at our disposal, however, are not aimed at systemic change.

First, there’s funding. Whether it’s on an EU level or a national level, funding is usually distributed by programs aimed at experiments, piloting and single solutions. It takes months, even years to put together consortiums and to write detailed applications. Understanding funding programs and being successful in them has become a specific area of expertise in itself. Most funding programs do not specifically aim at stopping global warming and even when they do, they mostly focus on narrow fields aiming to find specific, single industry solutions. We need to change the funding programs to answer to big systemic challenges.

The second problem is very much related to the first. If you want to create holistic, systemic changes, you can’t do it on your own – no matter if you’re a research group, a business or a city. Big transformations can only happen in ecosystems. And they don’t happen by themselves – some actors should specifically think about what are the most crucial challenges and who need to team up to solve them. These actors can be called orchestrators. An orchestrator is able to recognize the strengths of the multiple different actors and the role each of the participants should play in the ecosystem. An orchestrator also has a clear vision of the solution that will come out of the collaboration between those actors. This is what Smart & Clean foundation is doing with the ‘Closed Plastic Circle‘ in the Helsinki region.

Solving the above mentioned challenges would bring clear benefits. First, we would have funding instruments that truly focus on curbing global warming to 1.5°C. Second, with the help of different orchestrators, we would identify which actors from which fields need to work together to make solutions possible. In an ideal project you would then have the regulators, industry solutions, and new research-based innovations working together in a practical way and with a clear agenda. Each participant would also clearly understand that they get more out of the projects, because each part of the value chain feeds the other.

The ‘Closed Plastic Circle’ is a good example of such an ecosystem. You can see that Fortum’s Recycling and Waste Solutions requires Helsinki Region Environmental Services Authority HSY’s or Lassila & Tikanoja’s waste collection and management services to provide the raw material for their plastic refinery. And in order to create demand for the recycled plastics, both the cities as buyers and the big supermarket chains, like Kesko or S-Group, need good design of used plastic products by Orthex or some new innovative companies.

Ecosystems and the solutions created within mobility, energy or built environment, can also be a completely new export opportunity for the Helsinki region. The aim of the work we at Smart & Clean are doing is to find business solutions that can be adopted in other cities around the world. We could offer real substance in the world by providing holistic, systemic models for curbing global warming in cities while simultaneously creating economic value and growth though circular economy.

Text: Iina Oilinki