(Originally published in the Irish Times, May 14, 2004)
Promoting Innovation While Improving Quality of Life
By Finbarr Bradley and James J. Kennelly
In a review of industrial policy to be published shortly, the Tanaiste's Enterprise Strategy Group will reportedly advocate radical approaches to stimulating an innovative culture in this country.
Changes will be recommended in the allocation of grant aid to encourage Irish firms to conduct research, innovate and advance along the value chain.
Measured in purely economic terms, Ireland has by now not only caught up with but also surpassed much of the rest of Europe. Yet most Irish accept that the past approach to development has had negative implications for social equity, community, so called "traditional values" and the natural environment.
The dominant logic appears to be that if the economy can produce close to its full productive capacity and the country's infrastructure is sufficiently upgraded, the opportunity to address distributional and quality-of-life concerns will present itself. Ireland will have "arrived" at a place from which it will have the leisure to address non-economic issues. This ought to raise questions. Foremost among them, do social and environmental issues need to wait?
Are they merely an afterthought, or a nuisance, to be treated as disconnected from the economic policies of the country? Will they be attended to only as part of a sequential, trickle-down process? The best-known measure of economic output, Gross Domestic Product or GDP, does not measure the quality of our lives. There is a deepening realisation internationally that high GDP growth, and its accelerating social and environmental by-products, are rarely matched by a proportional improvement in human well-being.
GDP, after all, includes natural resource depletion as an income item, ignores questions of distribution, excludes all non-monetary exchanges, and counts social and environmental calamities (pollution clean-up, costs of dysfunctional families and communities, law enforcement, etc) as legitimate products.
This country's economic fortunes are strongly linked to the highly-skilled, specialised, and often rare talent that drives the high value-added tech sector.
To such workers, quality-of-life issues loom large. As societies get richer, it is precisely the "non-market" aspects of life that are valued. Ireland's increasingly skilled workforce demands, and expects, a very high quality of life. Sustainable development is about enhancing just such a quality ethic. Issues like carbon taxes, renewable energy, waste charges, recycling, climate change, water quality and transport policy feature in much of the debate both here and overseas about ways to enhance quality-of-life.
Companies that nurture sustainable innovations engage in the design of products, services, processes, and systems to create a future that includes the healthy co-evolution of human and natural systems.
Sustainable entrepreneurship is an attempt to integrate the economic, environmental and social impacts of business decisions, and the real growth opportunities in the future will exist for enterprises that enhance all three elements simultaneously.
Highly innovative countries such as Finland and Denmark tend to give a high priority to sustainability as a guiding theme. Such an enterprise culture encourages businesses to maximise eco-friendly resource productivity, do more and better with less, and redesign products and services on industrial ecology models that mimic biological behaviour in order to produce zero waste.
Enterprising capacities that far transcend traditional concerns with narrow, short-term profit maximisation will offer exceptional opportunities to those who respond to the challenge.
21st-century entrepreneurship, in the widest sense, will extend into community work and care, urban renewal programmes, heritage activities and social and cultural activities.
Agriculture and rural development in Ireland will depend on entrepreneurial ventures producing not only a range of high-quality food products but also a broad range of "green services" like valuable landscapes and rural amenities.
Entrepreneurship in the face of a multitude of environmental opportunities can help build a national prosperity that is wealth enhancing, socially equitable and ecologically sensible. We are well positioned to take serious steps along the road towards a truly sustainable economy and society. As a "late bloomer" economically, the country has been spared the worst excesses of industrial development, and has leap-frogged into its present knowledge-based prosperity. With a reframed and expanded understanding of development and enterprise culture, fully adapted to an Irish context, we have been presented with a formidable opportunity.
This country possesses a unique opportunity to follow a development path consistent with the identity, heritage, aspirations and capabilities of its people. The question is whether we have the vision, and the will, to move from promoting a narrow concept of growth and enterprise to focusing on the sustainable management of Ireland's human and non-human resources. Failure to grasp this distinctive opportunity would truly be a tragedy.
Finbarr Bradley is a faculty member of the Economics Department, NUI Maynooth.
James J. Kennelly is chairman of the Management and Business Department at Skidmore College, Saratoga Springs, New York. He is the author of The Kerry Way: The History of the Kerry Group, 1972-2000 (Oak Tree Press).
Creative Thought Matters.