National innovation strategy 2023 to 2033

Our vision is for Scotland to be one of the most innovative small nations in the world. This is our ten-year strategy to deliver that ambition. Innovation is a key tool to make Scotland a fairer, more equal, wealthier and greener country.

10. Innovation Scorecard


The Strategy's four transformational programmes will be designed and delivered to support our vision of Scotland becoming one of the most innovative small nations in the world. To ensure we are making the necessary progress towards that ambition we will track our innovation performance on a number of a key metrics over the next ten years.

We will do this through Scotland's Innovation Scorecard which will track Scotland's innovation performance over time on a set of key indicators against other nations.


The European Innovation Scoreboard provides a starting point for EU-wide comparisons between Scotland and other European regions and nations.[29] EU countries and regions are assessed in four performance groups: Innovation leaders, Strong innovators, Moderate innovators and Emerging innovators. As part of its analysis of Scotland we can see:

i. Scotland's innovation credentials are ranked as 'strong' alongside other nations and regions including Ireland, Norway, Iceland, Austria and the West Midlands, but below those deemed to be innovation 'leaders' such as Denmark, Finland, Belgium, Sweden, and South East England.

ii. Scotland's innovation performance is among the strongest in Europe in a number of areas including skills and education levels in the workforce. Scotland is ranked the top performing country in the OECD in terms of Higher Education investment in R&D as a percentage of GDP.

iii. Scotland has an average level of performance relative to comparable 'strong 'nations and regions on aspects including employment in innovative enterprises, and innovation expenditure per employee.

iv. Scotland falls short relative to comparable 'strong' regions and countries in other areas – business R&D, SME product and processes innovations, and levels of employment in knowledge-intensive activities.

Figure 8: European Commission's Regional Innovation Scoreboard for Scotland, 2021

A spider graph showing Scotland’s performance in a number of different innovation metrics relative to both the UK and the EU. Scotland performs strongly compared to both the EU and the UK in educational metrics, collaboration and employment of innovative SMEs, and innovation expenditure per person employed.

Source: European Commission's Regional Innovation Scoreboard 2021


The Scottish Innovation Ecosystem is based on an infrastructure of public, private and third sector organisations and a set of existing innovation assets based on Scotland's natural advantages, research specialisms and existing clusters of innovative businesses. These generate opportunities for public and private investment throughout the innovation process which we see in terms of both an innovation pipeline and a wider process of diffusion and adoption across Scotland's business and wider organisational base.

Our Innovation Scorecard will monitor the performance of our innovation ecosystem across each of its elements and stages using the best and most up to date data and evidence available. We will continue to engage across Europe and internationally and seek to learn from others in how we measure and assess our innovation performance and its impacts on the national economy.

While we need to be aware that there are often lengthy time lags until economic impacts emerge from new innovations, and we also need to factor in time to implement and deliver a new strategy, the Scorecard will provide a useful snapshot of the health of the Scottish innovation ecosystem over time.

Innovation Pipeline

Key metrics have been identified for each stage of the innovation pipeline:

  • Concept – which aims to track the generation of new ideas both within universities and the private sector
  • Convert – which aims to measure the movement of early-stage research towards being closer to market
  • Commercialise – which aims to track the realisation of the early economic benefits of innovation

For Concept we have selected patents and collaborations as our key metrics. Patents are traditionally used to track innovation and allow for comparison across different geographies. We have chosen to measure Patents Granted which is a more concrete indicator than applications. We will also track innovation between higher education and the wider economy through monitoring data on academic income from business and community interactions – this is a useful indicator of collaboration.

For Convert we have selected early stage risk capital and spin-outs accessing equity finance as our key metrics. The attraction of investment capital is an effective indicator of innovation that is closer to the market. Although not all deals are innovation driven, this is a strong proxy for innovation as the data shows the top sectors for deals are generally those associated with innovation. We will track risk capital overall and deals below £10 million, early-stage deals, and we will measure both the number and the value of deals. We will also measure the number of university spin-outs which are attracting equity finance and as such are likely to be high-growth start-ups.

Figure 9: Early stage equity investment deals in Scotland by sector, 2016-2020

A chart showing equity deals in Scotland by sector using scaled bubbles, the x axis from left to right showing projects with an increasing wider economic impact and the y axis showing the level of comparative advantage. The top right hand corner of the graph is a segmented section showing those sectors where Scotland has both a strong comparative advantage and large wider economic benefits.

Source: Scottish Enterprise, June 2021, Investing in Ambition: Scotland's Risk Capital Market in Context

For Commercialise, we have selected BERD jobs and high growth businesses. Whilst the number of BERD jobs may be small (as it is in other countries), there is a common understanding that there are large multipliers around these jobs for other professional occupations in innovating companies. We will also monitor the numbers of high growth businesses. These companies generate disproportionate jobs and innovation and are key to economic transformation. Finally, we will measure later stage investment (venture capital) which is an indicator that the projects behind the deals in question are seen by investors to offer strong opportunities for returns.

Manufacturing and Supply Chain - in addition, we will track the number of manufacturing jobs within each of our cluster priorities, drawing out rich data to include high value jobs, skills spending and apprenticeship numbers.

Diffusion and Adoption

The Innovation Scorecard will track 'diffusion and adoption' across the business base by measuring the percentage of innovation-active businesses and overall levels of research and development 'investment'.

The measure of innovation active businesses follows the OECD definition of innovation and assesses the following activities, within the survey period:

1. the introduction of a new or significantly improved product (good or service) or process;

2. engagement in innovation projects not yet complete, scaled back, or abandoned;

3. new and significantly improved forms of organisation, business structures or practices, and marketing concepts or strategies;

4. investment activities in areas such as internal research and development, training, acquisition of external knowledge or machinery and equipment linked to innovation activities.

A business that had engaged in any of the activities described in points 1 to 3 is defined as being 'innovation-active'. A business that

had engaged in any of the activities described in points 1 to 4 is defined as a 'broader innovator'. Finally, any businesses that had engaged in the activity described in point 3 were classed as a 'wider innovator'.[30]

We are also interested in measuring the adoption of innovation in the public sector. There is not currently a suitable available metric for measuring innovation in the public sector, but we will work with key stakeholders and learn from international best practise to pursue this ambition over the course of the Strategy's ten-year lifecycle.

For Investment we will monitor Expenditure on Research and Development from the innovation triple helix – industry, academia, and the public sector. We will track this for business and higher education and at an overall level (also including government investment) as a percentage of GDP to allow international comparisons. (N.B. these indicators are currently being reviewed by the Office for National Statistics following a significant initial revision to the method used to collect the data.)

Diversity and Inclusion

As part of the Scorecard, we will also develop suitable metrics to capture and assess participation and impact in the innovation ecosystem including data on equalities, diversity and inclusion. This will include access to finance, funding, jobs and opportunities. We will ensure that the Strategy's programmes are developed with diversity and inclusion at their heart and that suitable metrics and indicators are utilised to monitor this.


14. We will publish an annual Innovation Scorecard.

The initial framework for this scorecard is shown in the table on page 68.



Metrics Used In Scorecard

Current Performance


Progress Since Last Year


The generation of new ideas within universities and the private sector.

1. Patents granted

2. Academic Income from Business and Community Interactions

  • Scotland underperforms compared to the UK on patents when considering population size (approx. 31%).
  • Scotland underperforms in patents granted compared to the EU when considering GDP size.
  • income from business community interactions in 2020/21 was £690,907, which has grown by 45% over the past 4 years.
  • In 2020/21 the value of contracts held by Scottish HEIs was £292.4 million, which has been trending upwards for 4 years from £196.8 million in 2017/18.
  • Scotland had 251 patents granted in 2020. This represents an underperformance per capita compared to the UK of around 31%.
  • The EU granted 58,656 patents in 2020, which is 4.4 patents per billion GDP. In contrast, Scotland achieves only 1.2 patents per billion GDP.
  • Scotland is in the top 3 regions for value of HEI community to business interactions, and this figure is fast growing over the past 4 years. In the previous period, Scotland ranked 4th.
  • Scotland has seen growth in academic and community interactions since the previous year.
  • Scotland has improved from 4th to 3rd in comparisons with UK regions.
  • Scotland saw its patents granted per GDP increase over 2019/20 by 0.28pp while patents granted in both the UK and EU fell. However, Scotland still underperforms despite this growth.


The movement of early-stage research to being closer to market.

3. Risk capital (deals under £10 million)

4. BERD jobs (as a percentage of 16-64 labour force)

  • For deals under £10 million, £305 million was invested across 440 deals in 2020. This is down 5% over 2019.
  • BERD jobs made up 0.61% of the total Scottish 16-64 labour force in 2020, up from 0.56% in 2019.
  • Deals under £10 million has recently fallen, though not as severely as the UK average.
  • Scotland ranks 4th lowest in the UK for BERD jobs as a percentage of the workforce. For context, 1st place is almost 3 times higher at 1.51%.
  • Performance in risk capital has seen an increase in the number of deals, however total investment has stalled.
  • BERD jobs has seen a slight increase over 2019/2020. However Scotland remains ranked 4th lowest of the UK regions.


The realisation of the early economic benefits of innovation.

5. High growth businesses

6. Later-stage equity (deals £10 million and over)

  • 9.7% of businesses in Scotland were 'high growth' in 2020. This fell to 7.2% in 2021, likely due to the impact of the COVID-19 pandemic.
  • The UK rate of 'high growth' businesses in 2020 was 10.1%. This fell to 8.2% in 2021, likely due to the impact of the COVID-19 pandemic.
  • Both the UK and Scotland have seen a roughly 2% fall in high-growth businesses over 2020/21. However, Scotland has fallen from being the middle performer (6th of 12) to rank second-lowest of the UK regions in 2021.


Organisations that are adopting innovation and have become innovation-active.

7. Percentage of innovation-active businesses

  • In Scotland in 2021, 39% of businesses were measured as being 'innovation-active' in the UK Innovation Survey.
  • This is a 6.8% increase on the figure from 2018, however still lower than the previous high of 2014, which saw an innovation-active businesses rate of 50.4%.
  • Scotland underperforms in terms of innovation-active businesses, both in the UK and EU.
  • Scotland is second lowest after NI in innovation-active firms, and 9th lowest among the 27 EU member states.
  • However, the percentage of innovation-active businesses has grown over the past 3 years (6.8%).
  • Scotland has seen an increase in innovation-active businesses over the last two editions of the UK Innovation Survey (2018-21).
  • However Scotland continues to underperform relative to the UK and EU.


Expenditure on research and development.

8. GERD as a percentage of GDP

9. BERD as a percentage of GDP

10. HERD as a percentage of GDP

11. GovERD as a percentage of GDP

  • Scotland saw an expenditure on GERD as a percentage of GDP in 2020 of 3.13%, this is a 0.29pp increase on the previous year.
  • Scotland saw an expenditure on BERD as a percentage of GDP in 2020 of 1.91%, this is a 0.17pp increase on the previous year.
  • Scotland saw an expenditure on HERD as a percentage of GDP in 2020 of 1.06%, this is a 10pp increase on the previous year.
  • In terms of BERD spend by GDP in 2020, Scotland ranked in the middle of the UK regions (3rd highest).[31]
  • Scotland outperforms the EU 27 group of countries in terms of HERD in 2020, as the EU average was 0.51% of GDP.
  • Scotland outperforms the EU 27 group average for BERD, which was 1.51% of GDP in 2020.
  • In terms of total gross R&D expenditure, Scotland outperforms the EU 27 average for 2020, which was 2.26% of GDP.
  • In terms of BERD spend by GDP in 2020, Scotland ranked in the middle of the UK regions (3rd highest).[32] This is the same placement relative to other regions as in 2019.
  • Scotland outperformed the UK in terms of total GERD expenditure in 2020, at 17pp higher GERD spend as a percentage of GDP.


  • Total GERD spend as a percentage of GDP in the UK on was 2.96% in 2020.
  • Over the past 3 years, Scotland has consistently outperformed the EU average levels for BERD/HERD/GERD as a percentage of GDP.

World-leading Life Sciences innovation in Dundee

In 2014 Dundee was named as the UK's first City of Design by the United Nations. The City has been recognised by UNESCO for its diverse contributions to fields including medical research, comics and video games. Dundee was added to the UNESCO grouping of "creative cities" alongside European cities Turin, Helsinki, Bilbao and Curitiba in Brazil. The title recognised the design innovations which Dundee has contributed to the world, including aspirin, biomedical research which has led to hundreds of new cancer drugs, orange marmalade and video games including Lemmings and Grand Theft Auto.

Dundee is a vibrant location for education, research, and enterprise that is harnessing scientific discoveries to address local and global health challenges. It has world-renowned capabilities in life sciences research that is boosting UK life sciences competitiveness and growing the regional economy.

Dundee has an exceptional track record in life sciences and health technology commercialisation and in securing international venture capital investment to support it. Commercial successes include:

  • Exscientia, a world leader in Artificial Intelligence-driven drug discovery and design that underwent a £0.5 billion IPO in 2021.
  • Amphista Therapeutics, a global leader in the development of next-generation targeted protein degrader therapeutics; and
  • Current Health, developed by CEO Chris McCann while studying at the University School of Medicine, delivers world leading remote patient monitoring to propel home-based care models.

Based on these strengths and successes, Dundee University is spearheading a step-change in life sciences R&D by creating a Life Sciences Innovation District. This will grow the biomedical cluster and, crucially, provide the physical infrastructure and support to anchor and scale high growth life sciences companies in the city for benefit of the regional economy. The first stages, the building of an Innovation Hub for spinout companies and a facility for MedTech innovation, are already underway.

Together with exciting developments at the James Hutton Institute, at the outskirts of Dundee, in agricultural and environmental science and in advancing food and ecological security, the Life Sciences Innovation District Dundee makes Dundee a go-to place for Life Sciences innovation and R&D. The inward investment will create hundreds of quality jobs for school leavers and graduates in the region and will be an exemplar of how exceptional science can drive the Scottish economy.


Email: Innovation@Gov.Scot

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