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IPTS study reveals benefits of Corporate Spin-Offs

A recent study and seminar, which involved the participation of top EU industrialists, has highlighted the key role Corporate Spin-Offs (CSOs) can play in the European Union. But contrary to their value, the IPTS (Institute for Prospective Technological Studies) findings also ...
A recent study and seminar, which involved the participation of top EU industrialists, has highlighted the key role Corporate Spin-Offs (CSOs) can play in the European Union. But contrary to their value, the IPTS (Institute for Prospective Technological Studies) findings also revealed that CSOs have been neglected by policymakers.

Corporate Spin-Offs (CSOs) are often the result of re-structuring of the parent company, but they may also be formed when employees decide to realise their ideas outside the parent company and buy-out the relevant organisation, thereby establishing a new company.

Corporate Spin-Offs seem to foster industrial competitiveness. Their value can be seen in their high growth rates combined with very low failure rates (in particular when compared with new technology-based firms) and their generation of significant numbers of stable, long-term jobs.

The study also found a clear association between the Corporate Spin-Off's business success and its technological competence and innovation path.
The results were based on three elements: a working seminar which took place in Brussels in September 1999 which brought together high level industrialists; a survey carried out in seven selected EU countries; and a questionnaire which looked into the attitudes and experiences of large European companies in relation to corporate spin-offs.

The major obstacles facing companies in these areas are the different tax regimes, labour market inflexibility and access to finance. However, policymakers could assist in both financial assistance and provision of training, concluded the conference participants.

Subjects

Economic Aspects
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