Monday, 21 November 2016

Brexit: and the promises of innovation

Everyone loves 'innovation':
Futures Forum: The promises of technological innovation >>> The World in 2016

It's all rather fetishistic, though:
Futures Forum: Futurists >>> and the promises of science and technology >>> Part three: "Our naive innovation fetish"

If not vacuous:
Futures Forum: Techno-promises unfulfilled >>> Where did the future go?
Futures Forum: "Where are the flying cars?" or, "What happened to derail so many credible ideas and prospects?"

Although there are some really innovative ideas and technologies out there:
Futures Forum: Innovation in energy
Futures Forum: Exeter City Futures > technology, innovation, sustainability
Futures Forum: Building a new economy through grassroots projects

A CBI survey looks at companies' intentions on innovation following the Brexit vote:
7 in 10 firms plan to increase or maintain innovation spending in light of Brexit - CBI

And the press has taken up the story:

70% of firms in UK plan to increase or maintain innovation spending following Brexit

While 88% of firms said their board backed innovation, 35% of staff lacked time to innovate.

By Kedar Grandhi November 21, 2016 

Following UK's decision to leave the European Union, a majority of the firms in the country are in favour of investing in innovation. In a survey conducted by the Confederation of British Industry (CBI) – that acts as voice for firms at a regional, national and international level to policymakers – out of 818 firms, around 70% said that they would increase or maintain their spending on innovation.

According to the CBI survey, which was supported by Deloitte and Hays, a mere 7% of the firms said that they would reduce investments in innovation. It study noted that customer service and product development were two segments that would benefit from increased innovation.

"For more effective innovation, the top priorities are to increase collaboration and partnership (65%), greater access to technical skills (68%) and increased Government support (56%)," the survey noted.

While 88% of the respondents said that their board of directors backed innovation, about 35% of the firms said their staff did not have enough time to innovate. Meanwhile, 44% of the firms said their firms were pioneers in innovation (early adopters and developers), around 42% said they were experimenters (curious about innovation and looking to experiment) and 13% said they believed they were followers (once innovative practices are already in the mainstream).

The CBI also called on the government to commit to a long-term target of 3% public and private spend on research and development. This would support the ambition of UK businesses to make the country an innovation powerhouse.

Commenting on the survey, Carolyn Fairbairn, director-general at CBI said, "The UK will need to work hard to become the front-runner in global innovation, creating a pioneering economic role for itself in the world that drives prosperity in every corner of the UK."

He added, "Innovation is the nucleus of future economic and social development, so it's encouraging that seven out of ten firms will keep up - or even raise – their spending on new technologies and work practices to grow their business. As we prepare to depart the EU, this shows that firms are rolling up their sleeves and looking to make the best of Brexit.

"Spending on innovation generates jobs and economic growth across the country, offering solutions to the challenges we face today and in the years ahead from improving healthcare and mobile technology to a new generation of autonomous vehicles."

The survey was conducted as UK firms invested about £21bn ($25.94) on innovation in 2015, which allowed them to develop cutting-edge products and services, attract global investment and expand internationally.

UK Innovation: 70% firms plan to increase or maintain spending following Brexit vote

70% of UK firms to focus on innovation following Brexit vote

A survey by the CBI shows UK firms are concerned about lagging behind the global business community in this area.

08:47, UK,Monday 21 November 2016

Product development is seen as a key area for businesses to focus on
Some 70% of UK firms are planning to increase or maintain their spending levels on innovation following Britain’s decision to leave the European Union, new research suggests...

But many firms said that, while the UK leads the way when it comes to access to scientific research and tax incentives to make investing in research and development easier, it has much further to go in areas such as grant funding and collaboration between businesses...

In response to the research, the CBI is calling on the Government to put spending targets in place to aid companies that want to focus on innovation to drive growth and gain a competitive edge.

Video:What do businesses want from the Autumn Statement?

They are also appealing for access to skilled workers and tariff-free access to goods to be made priorities during Brexit negotiations, so that the UK can continue to lead the way in innovation going forward.

70% of UK firms to focus on innovation following Brexit vote

The BBC reports this morning:

Theresa May wants post-Brexit UK at 'cutting edge'

23 minutes ago From the section Business

Theresa May has begun speaking to the CBI's annual conference, where she is setting out her aim to put a post-Brexit UK at the "cutting edge". In her speech to business leaders, Mrs May will pledge an extra £2bn a year in funding for scientific research and development by 2020. A new fund to back areas such as robotics and biotechnology and help commercialise new discoveries.

Delegates will call on Mrs May to offer more "clarity" over Brexit.

Mrs May's speech to the Confederation of British Industry in London comes two days before the government delivers its first post-EU referendum budget, in the form of the Autumn Statement. She is to promise a new approach that is about "stepping up, not stepping back" when it comes to intervening in the economy.

Speaking about a new industrial strategy challenge fund, she will say: "Britain has firms and researchers leading in some of the most exciting fields of human discovery. We need to back them and turn research strengths into commercial success."

Mrs May is expected to add: "We will also review the support we give innovative firms through the tax system... because my aim is not simply for the UK to have the lowest corporate tax rate in the G20, but also one that is profoundly pro-innovation."

In the US, president-elect Donald Trump said during his campaign he would seek to cut the federal rate to 15%, but it is understood the Treasury still thinks the UK would be more competitive, once extra US taxes are factored in.

Following a speech earlier in the year in which Mrs May called for workers to be put on the boards of major firms and vowed to curb excess corporate pay, the prime minister will insist in her speech that she will "always believe in business".

But she will say firms need to do "more to spread those benefits around the country, playing by the same rules as everyone else when it comes to tax and behaviour, and investing in Britain for the long-term".

The CBI's director-general, Carolyn Fairbairn, said she welcomed the proposals. Business needs to create jobs and opportunities "in partnership with society", and "we need to think about how that works in practice", she told the BBC.

For the first time, Ms Fairbairn also said the CBI backed the Mrs May's proposals to have "the voice of workers heard more clearly in the board room". She said the organisation was "now looking very closely how they [Mrs May's proposals] can be adopted more widely. We would support that. We think it's a very good idea. We'll take that up straight away," she added.

Investment bank

Labour leader Jeremy Corbyn, who will also be speaking to the CBI, will warn against a "mishandled, chaotic Brexit". He will also call for a more interventionist role for government in industrial policy.

He will expand on Labour's proposal for a national investment bank, which he will argue would "help break the logjam in the British financial system" by lending to small and medium-sized businesses.

He will argue industrial strategy should not be about "picking winners" but should "set the missions, put in place the right institutional framework and support and provide businesses with the opportunities to develop our economy".

Analysis: Dominic O'Connell, Today business presenter

Like a stressed parent trying to coax a wayward toddler, Theresa May is promising treats for big business - spending on research and development, tax cuts - as long as companies behave themselves. Quite what good behaviour means, for example, is far from clear. Neither Carolyn Fairbairn, the CBI's director general, nor Paul Dreschler, its president, want to give examples of what corporate wrongdoing looks like. Is it breaking the law? That would seem to be the minimum, but what more is required - the eradication of zero-hours contracts, perhaps, or fully-funded pension schemes at all times - is anyone's guess.

The CBI will be happy to gloss over the details, and Fairbairn and Dreschler will be relieved that May at least has toned down some of the anti-business tone she took after she took over as prime minister. Then, she was talking about mandatory representation of workers on boards, while her home secretary, Amber Rudd floated the idea of companies having to say how many foreign workers they employed. Those days seem far off, and the relationship between business and government is much warmer than it was only a few months ago.

Theresa May wants post-Brexit UK at 'cutting edge' - BBC News

And this is the BBC reporting on the PM's speech to the CBI:

Theresa May bids to reassure business on Brexit 'cliff-edge'

1 hour ago From the section Business 1227comments

Theresa May has tried to reassure businesses fearing a sudden change in rules once the UK leaves the EU. Speaking at the CBI conference, Mrs May promised early agreement on the status of UK nationals in Europe and EU nationals in the UK.

"People don't want a cliff-edge; they want to know with some certainty how things are going to go," she said.

Several business lobby groups have pushed for an interim deal to let them trade in the same way post-Brexit.

Mrs May said she understood companies' concerns and was "conscious that there will be issues that will need to be looked at. That will be part of the work that we do in terms of the negotiation that we are undertaking with the European Union," she added.

She also pledged to provide clarity on the government's plans where possible, but said there would not be "a running commentary on every twist and turn".

Downing Street declined to say whether Mrs May's comments about avoiding a "cliff-edge" meant she was seeking a transitional deal to cover the period between the UK's departure from the EU and the start of a new trade deal.

"She was reflecting the views we have expressed already about how we secure the best deal for the UK and how we seek to provide certainty where we can to businesses and people across the UK of the steps moving forward," the PM's official spokeswoman said.

In the wide-ranging speech, Mrs May also pledged to:
> Invest £2bn annually in research and development by 2020
> Launch an Industrial Strategy aimed at spreading economic growth across the UK
> Examine how innovative firms can get long-term investment with a "Patient Capital Review"
> Launch a small business research initiative looking at how more innovators can get their first break
> Consult on plans to reform corporate governance, including executive pay and accountability to shareholders
> Deliver the "lowest corporation rate in the G20"

Workers on boards?

The prime minister also insisted she still favoured worker representation on company boards, dismissing suggestions that comments she made during the speech marked a watering-down of the idea.

There have been widespread reports since the summer that Mrs May wanted to see workers on boards as part of a corporate governance shake-up, an idea that had caused unease among companies and, according to the Financial Times, disagreements in Cabinet. However, the prime minister told the CBI that there were "other routes" to providing worker representation on boards, including advisory councils or panels.

"It will be a question of finding the model that works," she said.

Mrs May promised to shake-up governance as part of her Conservative Party leadership campaign in July, and repeated the promise at last month's party conference when she said she planned to have "not just consumers represented on company boards, but workers as well".

And later, on Sky News, when asked if her conference speech marked a watering down of the idea, Mrs May said. "No, what I've always said is that we want to look at ways in which we can improve corporate governance, looking at a number of areas, including workers' representation on boards. You can do that in a number of ways. We want to work with business on this and that's why we'll be consulting later this year on the various ways in which we can do it to find a model that works," she said.

'Clear promise'

However, trade unions said they were disappointed by Mrs May's remarks.

TUC general secretary Frances O'Grady said: "Theresa May made a clear promise to have workers represented on company boards. The proposals in her speech do not deliver on this. This is not the way to show that you want to govern for ordinary working people."

But CBI director-general Carolyn Fairbairn said "different approaches will work for different businesses" on employee engagement. "A starting point is firms being able to outline and explain what approach they are taking - whether that's employees on boards, employee committees, dedicated representatives, or other models that genuinely address the issue."

Mrs May also promised to boost productivity and cut corporation tax in exchange for help from businesses in tackling issues such as executive pay and shareholder accountability. "Just as the government must open its mind to a new approach, so the business community must too," she said.

The promises made by the prime minister include a "patient capital review" to help firms secure long-term investment. The review will be chaired by Sir Damon Buffini, the former head of private equity group Permira.

Mrs May also said the government would review the support given to innovative firms through the tax system "because my aim is not simply for the UK to have the lowest corporate tax rate in the G20, but also one that is profoundly pro-innovation."

Corporation tax is already due to fall from its current 20% rate to 17% by 2020.

Labour leader Jeremy Corbyn, who will speak at the CBI later, will warn against a "mishandled, chaotic Brexit". He will also call for a more interventionist role for government in industrial policy.

Theresa May bids to reassure business on Brexit 'cliff-edge' - BBC News

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