Room for Growth working group: Finland’s growth requires renewal of business structure and competence

The final report of the Room for Growth project led by CEO Risto Murto contains 41 proposals for boosting economic growth and finding new ways to do business. The most important proposals have to do with supporting renewal in the business sector.

In autumn 2024, Prime Minister Petteri Orpo appointed the Room for Growth project to come up with ways to promote sustainable economic growth in Finland. The project’s expert working group, led by CEO of Varma Mutual Pension Insurance Company Risto Murto, submitted its final report to the Prime Minister on 28 February 2025. 

“I would like to thank Risto Murto and his working group for their valuable work, which they completed on a very tight schedule. The wide interest in coming up with new growth measures shows that there is an acute need and broad support for boosting economic growth in society. Sustainable economic growth can only be achieved if we have growing businesses that are eager to make investments,” Prime Minister Orpo said at the event marking the release of the report.

At the event, Risto Murto highlighted the need for an extensive reform of Finland’s economic structure.

“In order for Finland’s economy to grow, we need rapidly growing companies and an evolving business structure. Competence, the success of growth companies and the renewal of industry structures play a key role,” Murto said.

The report presents 41 proposals for measures around the following themes:

1. People, competence and skills
2. Operating conditions for growth companies
3. The energy market and clean, green transition
4. The defence industry

The working group proposes significant additional investments in the R&D tax deduction for businesses and investment subsidies for the clean, green transition. These would reduce the corporate tax on eligible companies, bringing it closer to the EU minimum level of 15 per cent. This, in turn, would accelerate renewal in the business structure. The working group would make it easier to hand businesses over to the next generation, either by reducing the inheritance and gift taxes or fully replacing them with a tax on capital gains. This tax relief would be financed by increasing the taxation of dividends distributed by unlisted companies. 

To boost domestic financing for growth companies, the working group proposes that the central government focus its investments on non-listed companies and private equity. This could be achieved by reducing central government investments in listed companies and gradually increasing the investments of the state capital investment company Tesi by EUR 2 billion. The report also includes a number of other proposals related to the development of capital markets and especially capital investment activities. 

The working group supports the goal of raising the level of education so that at least half of young adults complete a higher education degree. As age groups decline in size, Finland should prepare for a controlled increase in the number of foreign students.
Investments related to the clean green transition should also be promoted by influencing the growth of end markets at the EU level and by ensuring sufficient clean energy and a functional energy market in Finland.

To harness growth potential in the defence industry, the working group proposes strengthening the central government’s role in export trade in the defence sector and establishing an innovation unit and startup accelerator within the defence administration. To realise the productivity benefits of artificial intelligence, the working group calls for close cooperation between the public administration, research institutions and the business sector.

The Government will discuss the proposals at a seminar on 4–5 March and in its mid-term policy review at the end of April.

Inquiries: Mikko Martikkala, Special Adviser, tel. +358 40 708 3932; Risto Murto, Chair of the expert group leading the Room for Growth project, requests for interviews: Anna-Liisa Randström, tel. +358 10 244 3119.