getting to net zero innovation

Innovation is often fraught with risk and unpredictability. While one simple theory about innovation is that it is all a matter of luck and that technology for example was discovered—and, perhaps, developed—mainly ‘by accident’ (for example, Post‐its, Viagra and Aspartame are well known examples of amazingly successful products which emerged ‘accidentally’ from research), innovation is most often a result of the deliberate attempt to solve a problem faced by a consumer or satisfy a need.  

According to the founding father of innovation theory, Josef Schumpeter, a distinction exists between an invention i.e. a novel idea for how to do things and innovation i.e. carrying it out into practice. A main reason for Schumpeter’s distinction was the realization that what matters economically and societally is not the idea itself but its exploitation in the economic and social system. If we would therefore like to maximize the contribution of innovation to economic and social change, then we should not only focus on what explains the occurrence of a novelty, rather we should gain a thorough understanding of its adoption and subsequent exploitation.  

Innovation can also be both incremental and disruptive. While many of the innovations which are developed to serve existing markets are in the nature of product extensions or process innovations, radical or disruptive innovations create new markets, they serve needs that have not yet been served by any good or service, or they meet existing needs in radically new ways. 

The development and commercialisation of products, services and business models that help society reduce emissions, can contribute to the transition to Net Zero. As such, there will be a need to create novel consumer offerings, new business models, and most importantly, new policy, regulation and market design.