Drivers of environmental innovation - Vinnova

3.2 A shift towards market drivers?
The historical account in the previous chapter suggests that firms today more
often see environmental issues as an integrated part of their business idea, and
environmental innovations as enhancing their competitiveness. This suggests
that market drivers should be more important than before and increasingly
more important than policy. Research results offer some support to this, but
there are also results pointing in other directions as well.
The importance of market drivers is shown by a Swedish report based on a
survey of 300 manufacturing firms. In 1991 very few of the firms stated that
market drivers were important, and that demands emanating from the various
branches of government were the dominant driver. Thirteen per cent of firms
stated that they did not experience any environmental demands whatsoever.
But in 1996, the strongest driver of the firms in 36 per cent of cases were
customers, in 24 per cent of the cases the concern and in 19 per cent of the cases
demands from government authorities (Heidenmark, 1999).
Similar results were found in an earlier Swedish study. In 1991, 72 per cent of
the firms stated that government demand was the prime source of
environmental demands, and 15 per cent that customers were the prime source.
In 1995 the corresponding figures were 38 per cent and 29 per cent. This
illustrates that customers have become a more important driving forces but also
that the sources of environmental demands has diversified. Other, less
important, sources were owners, employees and public opinion (IVA, 1995).
The shift towards more integrated environmental process innovations and
more environmental product innovations described in chapter 2, may be related
to the shift towards market drivers. Green et al found that product innovations
are driven more by market drivers than process innovations, whereas cost
savings are more important for process innovations (Green et al, 1994).
Malaman states that environmental conservation through cleaner technologies
appears to be an objective integrated into the primary objective of balancing the
budget, in contrast to end-of-pipe technologies, which always implies costs
(Malaman, 1996).
Older studies, however, indicate government policy as more important than
market drivers. One reason for this conclusion may be that the time period
studied is older. Hemmelskamp refers to such a study of the German textile
industry by Maas from 1987, when environmental innovations were mainly
implemented because of regulative pressure (Hemmelskamp, 1997). But the
difference in results may also be related to differences between countries and
regions. Connell and Flynn present a study published as recently as 1999 (data
from 1996/97), showing that firms in South Wales were driven mainly by
policy demands. Environmental demand pressures are likely to vary between
countries. Another reason is probably that the industrial structure varies
between countries.
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