From the Deputy CEO

It has been a very busy three months at the Foundation!  When we last met, I was describing a range of initiatives that were planned, and I’m delighted to say that all programs are well under way, if not fully established.
 
I’d like to say a personal thank you to all who responded to the survey we distributed in August.  Your feedback has given us vital intelligence about the things you value about the Foundation, the programs that provide you with benefit, and the aspirations for your future involvement in this important organisation.  You will see a separate article about the outcomes of the survey, and I hope it gives you interesting feedback about your opinions.  The team and I look forward to implementing many of the suggestions.
 
Our events calendar continues to attract high calibre speakers and participants.  The recent seminar on changes to the R&D tax legislation (since passed through Parliament) attracted a large audience of high calibre people, and received  high praise for the context and information it conveyed, as well as the tangible benefit it provided to practitioners.  Senator the Hon Kim Carr, Minister for Innovation, Industry, Science and Research opened the seminar with a spirited address about the importance of fostering research and development.  The Minister spoke to the government’s intent behind the legislation, describing opportunities for  business, both large and small, to benefit from the scheme, the impact of the reforms on Australian businesses and how R&D fits into the greater innovation landscape.   You will find a report of the proceedings in the members area of the Foundation’s website.  You will also see a commentary later in this newsletter, written by the seminar’s facilitator, respected journalist Leon Gettler.  Last month we were privileged to host a presentation by noted international affairs specialist Dr Keith Suter, who addressed Foundation members on the rise and impacts of the BRIC economies, in particular the opportunities presented by the development of India as a customer for Australia, and the emergence of Brazil as a potential competitor in the international marketplace.  Dr Suter was supported by commentary from Austrade’s Chief Economist, Tim Harcourt.
 
We are very pleased about the successful implementation of the Foundation’s expanded membership structure.  I look forward to speaking to many of you about these new opportunities to access the Foundation’s respected body of knowledge and become involved in our programs, and I encourage you to give me a call in that regard. You’ll see further information in this newsletter, and on our website. 
 
Our web site continues to strengthen, and I hope many of you will be aware of our initial forays into social networking.  The R&D tax seminar is supported by a LinkedIn page for opinion and debate, and we have just kicked off our Twitter account.  Follow @ab_foundation to see our “new news”.
 
Please keep in touch as we continue on our path of revitalisation at the Foundation.  We are delighted to receive your feedback, and I welcome the chance to talk to you in the coming months!

Jo Spencer
Deputy CEO

Save the Date - Regional Development Workshop with Professor John Tomaney

Thursday 1^st December, 9.30am – 1.30pm, Foundation offices, Clarence St, Sydney 



The Foundation is delighted to host a workshop by Professor John Tomaney, Director of the Centre for Urban and Regional Development Studies, Newcastle University, UK.
 
Professor Tomaney will present the latest thinking from the OECD and the European Commission, to build on case studies from his paper for the Foundation, Place-Based Approaches to Regional Development: Global Trends and Australian Implications, and to tackle the issues of regional development using the principles of ‘smart specialisation’. Professor Tomaney points to a significant shift in regional policies internationally, focusing on forging opportunities for growth and wellbeing in all regions.  This shift is based on awakening local community strengths, particularly the innovation capabilities of businesses, the skills and know-how of people and the strength and adaptability of local institutions. 
 
We invite you to be part of the dialogue with Professor Tomaney and Australia’s leading figures from business, government and academia to discuss and develop strategies to make regions prosperous and sustainable.
 
Mark this date in your diary, and we’ll be in touch with more information very soon.

Foundation Stakeholder Survey

The Foundation team recently sent out a survey to our extensive stakeholder database. The questionnaire sought your feedback about benefits, services and products provided by the Foundation. We were extremely pleased with the number of responses and we thank you very much for your time and insights - it is an unprecedented response. The survey was a valuable tool in helping us plan our future direction and your answers provided us with interesting ideas.
 
Responses came mostly from our members, although we also received feedback from quite a few interested non-members. Your involvement with the Foundation is primarily driven by our work on innovation, the opportunity to network within the Australian and international community of interest, participation in events, and the Foundation’s unique approach to future thinking and quality of research.
 
The highest priority for people getting involved with the Foundation is access to the body of knowledge, followed by the ability to participate in the Foundation’s network, ie, to interact with “the people in the room”. You told us that you are seeking greater consultation with members and stakeholders to determine research directions and discussion of topics.
 
Events for networking and knowledge exchange was identified as a high priority.  Participants would be willing to attend presentations 3-4 times a year, depending on topic. They may attend roundtables once or twice a year, and half-day seminars and intensive workshops once a year.  Respondents also expressed an interest in expanded online event facilities, such as forums and webinars.  This was identified as a valuable tool to for participation by those who are remote to the usual event venues.
 
You indicated that you would like to hear from us on a monthly basis, with a very clear preference to receive an e-newsletter or an email with a link to the Foundation’s website. You all follow mass media, and our stakeholders identified their most popular newspapers as the Australian Financial Review, Sydney Morning Herald/The Age, and the Australian (all print and online versions), as well as The Economist.  Magazine readership covers a gamut of business publications, and website readership such as TED, The Conversation and other associations and institutions was very common among respondents.
 
Overall, your comments highlighted your appreciation of the body of knowledge, your desire to have more involvement in contributing to the direction of the Foundation’s research program, your willingness to participate in events and online facilities, and also more frequent research releases, perhaps in the form of short papers such as our Occasional Paper series.
 
The Foundation team embraces your suggestions, and will take this valuable feedback into account with our forward planning.  Thank you again!

Membership Opportunities

The Foundation values highly the individuals and companies who are members of the organisation.  We have recently re-structured our membership charter to provide greater access, opportunity and benefit to those members and to Australia’s academic, government, corporate and SME sectors, and to encourage expanded membership in these areas as well as to affiliated institutions, and to full and part-time university students…..we welcome all those with an interest in emerging issues that are likely to impact Australian business into the future.  The Foundation achieves its work in collaboration with its members and stakeholders, seeking wherever possible their participation in our range of programs. 
 
By joining the Australian Business Foundation, individuals and organisations can access a range of benefits including:
 

• Debate that is independent, deep and well informed, at arms-length from political or ideological derivation, advocating ideas not lobbying for special interests
• Access to members only information and facilities on the web site
• Connectivity to a network of high calibre companies, government agencies and educational institutions
• A strong source of intellectual nourishment, where the Foundation looks beyond the everyday news and examines issues that are emerging on the mainstream agenda.
• The significant knowledge base and original content that the Foundation has accumulated over the past decade from its extensive portfolio of leading academic research linked with real life practical business experience.
• Invitation-only events and forums with cutting edge global thinkers and experts addressing emerging business issues
• Joint venture research projects and fellowships
• Opportunity to shape the Australian business debate
• Ability to influence research directions

 
You can see the full range of benefits on our website and please call Jo Spencer to discuss any aspect of membership of the Foundation.

What BRICs Can Build In Australia

The Foundation was privileged to host a boardroom discussion with Dr Keith Suter, international affairs expert and broadcaster. Also joining the dialogue was Tim Harcourt, Chief Economist at Austrade, who provided a commentary based on his frontline experience of doing business with these countries.

The BRIC countries - Brazil, Russia, India, China - are poised to become the world's new superpowers. Economists predict they will eclipse the current powerful countries by 2050. Australia is in an ideal position to create opportunities to deal with these countries, particularly in providing services to India.

However, Dr Suter explained that there could be downsides. The BRICs could fail to reach their potential. Brazil is becoming a very real competitor in resources and renewable energy, and may be perceived as easier to deal with by major importers such as China. Australia is still too focused on the US and UK and currently neglects trade opportunities with these countries. 

To read more about this event, please click here.

A Nugget of Gold - An Interview with Telstra

A NUGGET OF GOLD

From OMAR RESSAS, EXECUTIVE DIRECTOR, STRATEGY AND CORPORATE AFFAIRS, on TELSTRA and INNOVATION
Telstra is Australia's leading telecommunications and information services company, with one of the best known brands in the country. From its origins in 1901 as the Postmaster-General’s Department, managing domestic telephone, telegraph and postal services, through government owned Telecom Australia, and now privately owned by shareholders as Telstra, the organisation has undergone many innovative changes.

Q. What surprises you most about how innovation has evolved in Telstra over the last 110 years?

Over the past 110 years several fundamental changes have taken place – many of these shifts have been caused by innovative and disruptive new services. What is perhaps most surprising is the ability of the organisation to at times drive such changes, and at other times to adapt to the changes; the resilience of innovation and the relentless drive for improvement, and the capacity to change every aspect of how we operate and how services are delivered. It has by no means always been easy, but innovation never is.

Q. What do you consider has been the most innovative change in the business?

Over the past couple decades, the emergence of mobile devices and networks has probably been the most fundamentally disruptive innovative change – merely 20 years ago few people had mobile devices; now more than half of the population keep their mobile devices within arm’s reach even when they sleep. No other piece of technology has so quickly become so crucially embedded into how people live and work.

 
To read the full interview, please click here.

Feature Article: The New R&D - An overview

The New R&D: An Overview
Leon Gettler
 
The Gillard Government’s R&D legislation, which passed through the Senate in late August, is one of the most significant tax reforms since the GST. It’s certainly the most significant change to tax innovation since the original R&D tax concession was introduced in 1986.

In a nutshell, the reforms propose a credit system that gives a 45 per cent refundable R&D tax credit to entities with an aggregated turnover of less than $20 million per annum. All other companies will receive a 40 per cent non-refundable tax credit. The Government expects to hand out $1.6 billion in tax credits annually. Instead of passing on the tax credit in an annual lump, the Greens successfully pushed to have quarterly payments in a bid to improve cash flow for companies.  Strictly speaking, however, the 45 per cent figure is minus the 30 per cent tax deduction which they forego so entities would only pick 10 or 15 per cent. Unless of course they are making losses, in which case they would get the full 45 per cent.

There are a lot of plusses here. The refundable credit will see refunds going to small companies and spreads the R&D incentives more widely across the economy. The new law actually places no limit on the amount of R&D expenditure incurred.  The aim here is simple:  it is designed to encourage start-ups to invest far more in R&D than under the original R&D tax concession. And in a departure from the original R&D tax system, companies will be eligible for the credit even where the intellectual property related to the R&D is held off-shore.

To read the rest of the article, please click here.

Research Projects

Strategic Serendipity
Written by Darren Horrigan, this report summarises and distills the study Northern Sydney's Global Technology Corridor: A Scoping Study of Cluster Development by Professor Roy Green and Kate Hughes. This study looks at what drives successful industry clustering in Australia, specifically in the Northern Sydney region. It also provides an account of the attractors for businesses to a region, and of the opportunities for growth and the sustainable development of regions through clustering activities. This report has been delivered to the Foundation, and more information regarding its launch will be available soon.

Business Model Innovation
This study by Don Scott-Kemmis of the Australia Centre for Innovation examines the characteristics of business model innovation illustrated by Australian business case studies.

Green Chrysalis: Innovation Towards Australia's New Economy
Led by Professor Stuart White for the UTS Institute for Sustainable Futures, this study looks at the processes driving innovative business activity in response to the new operating conditions and opportunities of the 'green economy'.

Borders Blurred: The Changing Nature of Trade in a Globalised World
This study explores the participation of Australian firms in international trade and innovation behaviour and their links with business productivity. This study was undertaken by Professor Christopher Findlay and colleagues at the University of Adelaide.

The reports will be available over the coming months and will be available on the Foundation's website or as a printed copy. Please check the Foundation website for updates.

Recognising Our Supporters

                  

                                      

The Last Word

If you or your organisation is working on a product, service, research project or event that furthers new thinking on Australia's business competitiveness, innovative capacity and opportunities from a knowledge-based economy, please contact us and we will spread the word!

If you have comments, questions, suggestions, please contact us:
Australian Business Foundation
Level 12, 83 Clarence Street
Sydney NSW 2000
Ph: (02) 9350 8102
Fax: (02) 9350 8199

foundation@abfoundation.com.au
www.abfoundation.com.au