3.2. Rationale and Union added value

SMEs are key drivers of innovation due to their ability to quickly and efficiently transform new ideas in successful businesses. They serve as important conduits of knowledge spill-over bringing research results to the market. SMEs have a key role to play in technology and knowledge transfer processes, contributing to the market transfer of innovations stemming from the research carried out in universities, research bodies and research performing companies. The last twenty years have shown that entire sectors have been renewed and new industries created driven by innovative SMEs. Fast growing enterprises are crucial for the development of emerging industries and for the acceleration of the structural changes that Europe needs to become a knowledge-based and sustainable economy with sustained growth and high quality jobs. SMEs can be found in all sectors of the economy. They form a more important part of the European economy than of other regions such as the United States. All types of SMEs can innovate. They need to be encouraged and supported to invest in research and innovation and to enhance their capacity to manage innovation processes. In doing so they should be able to draw on the full innovative potential of the internal market and the ERA so as to create new business opportunities in Europe and beyond and to contribute to find solutions to key societal challenges. Participation in Union research and innovation strengthens the R&D and technology capability of SMEs, increases their capacity to generate, absorb and use new knowledge, enhances the economic exploitation of new solutions, boosts innovation in products, services and business models, promotes business activities in larger markets and internationalises the knowledge networks of SMEs. SMEs that have a good innovation management in place, thereby often relying on external expertise and skills, outperform others. Cross-border collaborations are an important element in the innovation strategy of SMEs to overcome some of their size-related problems, such as access to technological and scientific competences and new markets. They contribute to turn ideas into profit and company growth and in return to increase private investment in research and innovation. Regional and national programmes for research and innovation, often backed by European cohesion policy, play an essential role in promoting SMEs. In particular, Cohesion Policy Funds have a key role to play through building capacity and providing a stairway to excellence for SMEs in order to develop excellent projects that may compete for funding under Horizon 2020. Nevertheless, only a few national and regional programmes provide funding for transnational research and innovation activities carried out by SMEs, the Union-wide diffusion and uptake of innovative solutions or cross-border innovation support services. The challenge is to provide SMEs with thematically open support to realise international projects in line with companies' innovation strategies. Actions at Union level are therefore necessary to complement activities undertaken at national and regional level, to enhance their impact and to open up the research and innovation support systems.

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Source: EUR-Lex (Cellar) · retrieved 2026-11-03 · Text as adopted (Official Journal); later amendments are not incorporated in this text.