As the year draws to a close, and with the echoes of the COP26 United Nations Climate Change Conference still lingering, experts say that sustainability and innovation are not the future for successful businesses, but the present scenario. This is one of the keys to growth, both for established large companies and for start-ups entering the business world with new ideas and technologies.
The European Union (EU) is demonstrating a strong focus on sustainability by investing heavily in transforming its climate, energy, transport, and tax policies through the European Green Deal. Change is happening despite the effects of the pandemic; on the contrary, sustainability and innovation are at the heart of the Community's economic recovery. Support for green policies has also become more prevalent among Lithuanian institutions in recent years.
Sustainability requires more cooperation
Lina Žemaitytė-Kirkman, Head of the Rockit Centre for Financial Technology and Sustainable Innovation, says that Lithuania's experience in 2021 shows that the best results can be achieved when all stakeholders unite for sustainability: small and big businesses, the state, and politicians themselves.
“This year's Sustainability Accelerator has clearly shown that the challenges facing the world today are highly complex, and bringing together businesses from different backgrounds in communities and teams is essential. The multifaceted nature of the problem is reinforced by the fact that sustainability is usually related to different areas: innovation, energy, information technology, agriculture, etc. Targeted public policy can also bring the poles closer together,” says L. Žemaitytė Kirkman.
The Ministry will focus on sustainable innovation
And although Lithuania has made only a little progress in the World Innovation Index this year (from 40th to 39th place), there are some exceptional positive developments in the country. For example, the Sustainable Economy and Analytics Centre was set up at the Agency for Science, Innovation and Technology (MITA) in September. The first areas are the analysis and mapping of industrial digitalisation, the circular economy and strategic value chains, and a feasibility study on the use of green hydrogen in the Lithuanian industry.
As a good example, the European Commission's Digital Economy and Society Index report ranked Lithuania above the overall EU average, and Lithuania was ranked 4th in terms of digital services for business.
Aušrinė Armonaitė, Minister of Economy and Innovation, notes that in Lithuania, sustainable ideas not only have a favourable environment to emerge but also to be successfully implemented, thanks to the very high level of competence of local professionals.
“Having been in constant contact with businesses and seeing their ambitions, I believe that Lithuania has huge potential for improvement. The Ministry will make every effort next year to promote the development and deployment of innovative digital and environmentally friendly technologies. We will pay particular attention to investments in eco-innovation, the development and production of sustainable circular products, and the application of the latest and most environmentally-friendly equipment and technological solutions in production processes. We need to create better conditions for sustainable businesses and be at the forefront with other world leaders in sustainable innovation,” says Armonaitė.
According to L. Žemaitytė-Kirkman, last year Lithuanian businesses implemented a number of commendable sustainable projects.
"We have seen a growing focus on renewable energy by the country's major companies and a drive to reduce CO2 emissions in their operations. I can also mention examples such as the world's first hybrid biomethane tractor developed by Auga for professional use in agriculture, or the EUR 250 million investment in Vinted, the only Lithuanian unicorn that promotes the sustainable sharing of things,” says L. Žemaitytė-Kirkman.
Greta Monstavičė, CEO of private equity fund and sustainable start-up accelerator Katalista Ventures, says that the digital way of communicating and collaborating that has taken hold in the last year due to the COVID-19 pandemic has also accelerated change and the development of sustainable innovation.
“In the past, investors were looking for good solutions and talented teams in the market, but now these two criteria are complemented by the sustainability aspect. While integrating sustainability is not an easy task for start-ups and businesses, we are seeing an increasing number of sustainable business programmes and accelerators that are helping this transformation to happen. This is particularly effective when start-ups are testing sustainable products with big businesses. This gives them an important customer while large businesses get a product based on sustainable innovation,” says Monstavičė.
According to her, a number of start-ups stood out in this year's sustainability accelerator, Rockit Impact: Datahood, piloted with Telia Lietuva, whose solutions help to make different city districts more sustainable and convenient for their inhabitants, while allowing businesses to discover the potential of these places, and Cogastro, which is developing an operating system for beetle farms. During the Accelerator, Earthbanc worked in line with Swedbank Lithuania to find ways to effectively measure the CO2 emissions of the bank's customers – an assessment that will be critical in the near future.
2021 was also a very successful year for PVcase, a Lithuanian start-up offering automation for solar power plant design, which raised an investment of €20 million. It is considered the largest investment in a software start-up of its kind in Europe.
Rockit, the centre for financial technology and sustainable innovation, will hold its second Sustainability Accelerator next year, taking stock of all the sustainability and innovation-related developments that have taken place in Lithuania and globally this year. It is planned to take place in the spring, with a strong focus on pilot projects with major Lithuanian businesses. Startups not only from Lithuania but also from all over the world are invited to join. Register at www.impact.rockitvilnius.com.