We believe the two kinds of sustainable businesses are interlinked: one that meets its climate targets and managing its finite resources is also setting itself up to endure into the future, able to adapt to uncertain and volatile conditions.
For foreign direct investment, a sustainable business is one that is here for the long term. In Ireland, we’re fortunate to have welcomed more than 1,800 overseas businesses to establish operations here, with one-third of them have been in Ireland for more than 20 years.
Those businesses have endured because they have adapted. Many of the operations that first set up in Ireland look vastly different now to when they began; some, like Ericsson in Athlone for example, started as manufacturing sites but have since transformed into strategic research and development hubs.
If anything, the imperative for businesses to change has accelerated. At the midpoint of this decade, many companies find themselves at a crossroads. At a high level, they are grappling with how to integrate climate goals into their business – and in doing so, make their operations more cost-efficient. At the same time, they want to make themselves more resilient against external forces or shocks.
The specific challenges will vary by industry: a technology or life sciences company that manufactures physical products will look for different outcomes compared to a financial or services provider whose business relies on intangible assets. If we imagine four key drivers of innovation, digitalisation, talent, and sustainability, the exact combination of each will be unique to every company.
But at a high level, we can say this: all businesses need to adapt, change, transform to remain relevant, competitive and also attract and retain talent.
Many leaders are asking themselves fundamental questions: are their processes and ways of working fit for purpose in the years ahead? Do their teams have the right mix of skills that will allow them to adapt to a changing environment? Are their supply chains robust enough to cope with unexpected disruptions? Do those businesses need to innovate more to stay relevant in their market, or adopt technology that can make their operations more efficient?
We know these questions well, because our role as an inward investment agency has granted us unparalleled access to the strategic conversations these companies are holding internally. We hear how they want to adapt, and we see our role as a duty of care to listen, understand and interpret their needs.
To the outside world, it may seem like our main goal is to secure new jobs, but that only describes part of what we do. As a partner, we have always looked for ways to deepen the relationship through ongoing dialogue, to ensure we continue to deliver over the long term. It’s about looking to sustain the businesses that have been here, often for years, by creating the conditions for them to flourish.
So just as our clients need to transform, we believe the way we can best work with them into the future is by changing too. One of the big changes our clients will notice is IDA Ireland’s new client transformation division. Until now, a multinational in the financial services sector, for example, was assigned a group of dedicated people to support them in making investments.
From this point on, rather than thinking in terms of vertical industry sectors, we are now reorganising to provide services across businesses, focused on the four drivers of innovation, digitalisation, and talent and sustainability. These will be tailored, integrated services to help businesses to respond and become resilient in the face of the societal and technological challenges they face. We will provide them with subject matter experts across disciplines such as RD&I, sustainability and skills development, who can work together with clients to create a solution for their specific needs.
As a public agency, we have a responsibility to uphold climate targets that the Irish Government has committed to in legislation. We also have a mandate to meet the needs of our industrial clients, many of which are large organisations whose commitment to science-based targets and climate action in enshrined in their own ESG plans, and their performance against those targets is increasingly linked to their financial performance
We believe these goals are not mutually exclusive. If we can deliver on decarbonisation opportunities and improve client sustainability, then we deliver on their corporate objectives and on our national objectives. The businesses stay here, and grow here, because they are adopting innovative processes; that the buildings they occupy are climate resilient; that their supply chains are rigorous and robust; that their talent is matched to their future skills needs.
In this way, their Irish sites can become beacons of best practice in innovation, sustainability technology and talent development that other locations in their networks can follow and replicate.
This is not just a forward-looking strategy: it is a model that has already been successful. Analog Devices is Ireland’s participant in a new European project in microelectronics and communication technologies, which is designated as an Important Project of Common European Interest (IPCEI). These initiatives are intended to support large-scale cross-border projects that drive EU innovation and help achieve digital and green transitions.
The European Commission approved State investment in Analog Devices’ €630 million Project ‘Fanfare’, which will combine public funding with similar levels of private investment. Analog Devices is one example of a sustainable business, having originally set up in Ireland almost 50 years ago, in 1976. Since then, its Irish operations have evolved into one of the company's strategic centres and its European regional headquarters. This is Ireland's first direct participation in an IPCEI, which aims to advance innovation, sustainability, and technological performance. IDA Ireland has contributed to Analog Devices through upskilling, decarbonisation and innovation.
We live in times of change. And as the 1,800 companies we partner with look to understand how to grow and transform, we have a duty of care to listen, understand and interpret and help them respond to their needs.