"The greatest potential of wood construction is in cities" - Research Professor Katja Lähtinen continues her work at Luke

Katja Lähtinen, Research Professor of Business Economics and Business Models, continues her work at the Natural Resources Institute Finland (Luke). Her extension period started on March 1st 2024.

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Lähtinen has been Research Professor of Business Economics and Business Models at Luke since 2019. She researches strategic management, marketing, sustainability and accounting, especially in the context of forests and forest value chains. The aim of her research is to generate knowledge to help companies, the public sector and citizens to make decisions that support the development of the bioeconomy.

Market opportunities for wood construction in cities

A major area of Lähtinen's research has been wood construction, particularly from the perspectives of markets and land-use planning.

Wood has many bioeconomical and sustainability benefits in construction. Wood is a renewable raw material that can be used to reduce carbon emissions, increase carbon stocks in buildings and improve the comfort of the living environment.

The greatest expectations and ambitions of wood construction are in urban areas where wood has not typically been the primary building material.

Until the early 2000s, the proliferation of timber construction was thought to be primarily a matter of construction regulation and technological processes. But Lähtinen's research results have shown the phenomenon to be more complex. 

"In housing in particular, location and design solutions are the primary criteria for consumers when choosing a home, and building materials are considered only after these factors. The survey data we have collected from consumers in a Nordic cooperation project has indicated that the consumers who are most prejudiced against wood construction are those who prefer urban living in areas with good reputation - not only in Finland, but also in countries such as Sweden and Norway," says Lähtinen.

Land-use planning can influence the growth of the urban timber construction market by including timber buildings in and around city centres. However, this requires that projects are implemented by the construction sector and that the industry actors cooperate.

New business from nature-based solutions

Alongside wood construction, nature-based solutions in the built environment are an opportunity to promote the circular bioeconomy. Product development is still in progress, but as the market develops, Lähtinen anticipates that nature-based solutions can be used to cool and heat buildings with facade green coverings and green roofs and to improve the cosiness of the living areas.

"Nature-based solutions are an opportunity to reduce the climate impact of the built environment and improve biodiversity. At the same time, it can increase the well-being of citizens. In business terms, this is a significant opportunity for companies bringing new innovations to the market," says Lähtinen.

Systemic change is needed to make the bioeconomy a reality

There are good opportunities for the development of the Finnish bioeconomy, based on rich renewable natural resources and diverse business activities. Another important aspect for the regional economy is the fact that companies are located widely across Finland.

However, for the circular bioeconomy to become a reality, systemic change is needed. This means that new regulation, service packages and supply are needed. To achieve this change, industry actors need to cooperate, enable learning and develop new solutions. This can happen, for example, through the development of regional innovation systems. 

Lähtinen emphasizes that understanding the different features of market supply and demand is essential for the development of the bioeconomy market.

"People often talk about value creation. We need to better understand what value means for different customer groups. To put it a little more bluntly, there is no value if the customer does not recognise it," says Lähtinen.

Concrete examples from the consumer market include food and housing. 

"Some people want vegetarian food and pay a premium for it, others don't want it even for free. For some, an apartment in an urban area is a dream home, for others it's the worst possible housing option. In the development and marketing of product and service packages, different needs are a rich asset and must be taken into account. And understanding who your customers are and what they want will allow you to compete in the market on more than just cost-effectiveness."

Katja Lähtinen's Professorial Lecture will take place on April 12 at 9:00-9:30. The lecture and remote participation link for the lecture discussing the transition to circular bioeconomy will be available later on the event calendar of the Luke website.