Denmark is good at creating new companies-but poor at making them big. That is why we need a Minister for Innovation who can bring a fragmented system together and get more out of billions in business support, writes Frank Rosengreen Lorenzen.
The election campaign is over, and we are eagerly awaiting a new government.
I hope the new government will dare to think differently and seriously address how we make Danish industry more competitive. Because there were few concrete proposals during the election campaign.
“We will make Denmark richer,” was said many times, but when it comes to concrete initiatives, proposals were few and far between. It is unlikely to come from a wealth tax or small adjustments to corporate tax or the share savings account.
No, the challenge is bigger than that. The Draghi report made it clear: We are not good enough at turning knowledge into productivity, growth, and companies.
We are beginning to see the bottom of the pot-and at the same time, dark clouds are gathering. AI, supply problems, energy shortages, and labour shortages risk hitting Danish industry like a perfect storm.
If we are to put something in the pot, we must create framework conditions that enable our industrial companies-which already contribute massively-to deliver even greater growth.
That is why we need clear political responsibility for innovation-how we create new ideas and turn them into commercial solutions-elevated all the way to ministerial level. As in Sweden, where innovation is gathered under one minister, or in Finland, where the Prime Minister coordinates the effort through a national innovation council.
In Denmark, responsibility is dispersed. No one has the overall overview-and innovation far too often becomes something everyone talks about, but no one manages.
Every year we start around 30,000 new companies. But after ten years, it is under one percent that reach more than 50 employees.
Frank Rosengreen Lorenzen
CEO, Dansk AM Hub
A Minister for Innovation should, first and foremost, take responsibility for reforming the Danish business and innovation system-that is, the actors and frameworks meant to help companies: universities, the Innovation Fund Denmark, GTS institutes, industrial lighthouses, clusters, and business hubs.
Because the system today is too fragmented, too complex, too administrative-and too little focused on results and impact.
A Minister for Innovation must bring the threads together and set a new direction. This requires three clear priorities:
Create the conditions for the next Danfoss
Denmark still lives off companies created decades ago: Novo Nordisk, Maersk, Grundfos, and Danfoss.
Every year we start around 30,000 new companies. But after ten years, it is under one percent that reach more than 50 employees. Only very few become companies with more than 1,000 employees.
Too many Danish companies stall, are sold too early, or never receive the support needed to grow globally. The explanations are many-tax system, economic cycles, and technology-but ultimately it is about prioritisation and focus.
We lack a political focus on scaling.
We must take far more targeted action for small and medium-sized industrial companies (SMEs) that, with a strong product, can grow globally-such as Linak with their actuators, Grundfos with their pumps, and Danfoss with their solutions.
We must help the Danish industrial companies of the future-not with small ad hoc trials and fragmented support schemes-but by identifying and leveraging new market opportunities for their existing positions of strength.
Get research into solutions
Denmark is among the world’s best at research-but we are far worse at turning it into companies and solutions.
We do not have a research problem. We have a translation problem.
Steps have been taken in the right direction with reforms of universities’ innovation efforts and targeted basic funding. But experience shows that more investment in research yields more research-not necessarily more commercial solutions.
If we want to change that, we must start from companies’ business opportunities: Where can Danish companies win? Which solutions are in demand? And how do we bring research into play to solve precisely those challenges?
Today, responsibility is too dispersed-and the many unfinished reforms of the system leave our Danish companies without up-to-date frameworks for innovation.
Frank Rosengreen Lorenzen
Director, Danish AM Hub
This requires a more direction-driven approach to innovation-rather than the many fragmented initiatives we see today.
An obvious example is artificial intelligence. Here we have the opportunity to develop digital solutions for industry based on world-class Danish research. We can develop software quickly, scale it efficiently, and share knowledge across companies-while also reducing dependence on foreign technology platforms.
But that bridge between research and the market does not build itself; it requires direction and the right framework conditions, which we do not have today.
Less administration-more impact
Companies today face an opaque system of funds, programmes, and actors.
For too many SMEs, it feels as if you can apply to a billion different schemes-without a clear direction.
This is not a new realisation.
Successive governments have tried to reform the business support system with the ambition of making it more streamlined and transparent-and to get more out of the approximately DKK 43 billion in business support.
But in practice, the opposite has happened.
The Frigast Committee mapped nearly 200 state business support schemes and recommended phasing out or reducing 58 of them. Nevertheless, only a limited part of the recommendations has been translated into real simplification and change.
We have analysed the problem. We have tried to reform it. But we have not solved it.
The result is a system that is better at administering funds than creating results-and where the funds crumble between the hands of the system’s actors before they create impact in companies.
A Minister for Innovation should be guided by a simple rule: If an initiative does not create a concrete impact on companies’ productivity, costs, development time, or CO₂ footprint-then it should not be funded.
Companies compete every day to create value. The public innovation system should do the same-just on impact.
Innovation is not a small policy area
“The more innovative you want to be, the more governance you need”-everyone who has worked purposefully with innovation knows this, but successive governments have not delivered on it; instead, we have ended up with a soft compromise with a bit of input from digitalisation, business, research, or education.
Today, responsibility is too dispersed-and the many unfinished reforms of the system leave our Danish companies without up-to-date frameworks for innovation. The kind that can fill the pot.
It is time to bring responsibility together and set a new direction.
By Frank Rosengreen Lorenzen, Director, Danish AM Hub. Published in Altinget, 20 April 2026
