Why Finland needs a new M&A mindset

After several demanding years, Finland’s economy is showing tentative signs of revival. IPOs are returning, mergers and acquisitions are stirring, and optimism is beginning to flicker in boardrooms. Yet a question lingers: will Finnish companies dare to grow?

That question framed the discussion at “Dare to grow – M&A as an enabler,” an event hosted in Helsinki by Nordea and Nordic Listed Leaders. The consensus among economists and corporate leaders was strikingly clear: Finland has the fundamentals to thrive, but it must rediscover its appetite for ambition.

“To grow, you need courage and boldness,” said Alexandra Therman-Londen, Head of Corporate Finance Finland at Nordea. “But Boards and management teams would need to have a common view of direction and risk taking.”

Alexandra Therman-Londen welcomed all the guests at the “Dare to grow – M&A as an enabler” event

Growth as the ultimate value driver

Therman-Londen’s message was simple but urgent. Growth, she argued based on some research, is the single most powerful driver of long-term value creation. It fuels revenues, strengthens cash flow, and ultimately raises valuations. Growth expands margins through operating leverage, sharpens competitiveness, and enhances both investor and talent appeal. It enables reinvestment but also dividends, and buybacks, combining into superior total shareholder returns.

Yet Finnish corporations invest markedly less in growth than their global peers. According to McKinsey data presented by Nordea, Finnish companies spend three times less on R&D and M&A and twice less on capital expenditure than the international average.

“If we want to raise valuations and productivity, we must invest more in the future and not just maintain the past and distribute excess capital to shareholders” Therman-Londen said.

M&A: A growth tool, not a gamble

Among the tools for expansion, mergers and acquisitions stand out as both underused and misunderstood. In Finland, M&A volumes amount to only 4% of total market capitalisation, compared with 8% in Sweden and 9% across the Nordics, a gap that represents billions in untapped opportunity.

“M&A is one of the most effective tools for growth,” Therman-Londen noted. “But companies must think beyond short-term profitability. Integration takes time, often much longer than anticipated. That’s why long-term vision and patience are critical.”

Nuutti Niinistö, Managing Director of Corporate Finance at Nordea, added that M&A is an increasingly important tool especially in the context of lower economic growth. “We should be open-minded towards the long-term growth opportunities that M&A can deliver,” he said.

Former Sanoma CEO Susan Duinhoven, now a board member at KONE and Kemira, echoed this point in a fireside discussion led by Niinistö.

“Before you do M&A, make sure your own company is ready,” she advised. “Integration requires stability, alignment, and the right people in the right places. M&A can be transformative, but only if the foundations are strong.”

In a subdued economic environment, that message resonated. For many firms, M&A may not just deliver scale, it can deliver reinvention, provided it is anchored in strategy and readiness.

Nuutti Niinistö and Susan Duinhoven at the “Dare to Grow: M&A as an enabler” event

International investors: Seeing the Nordics as one

Beyond Finland’s borders, the perception of the Nordic region is evolving. Many of the international investors no longer view the countries separately but as a single, interconnected market.

“We look at the Nordic market as a whole,” is a comment shared by many investors. “Our choices as to which markets we invest in are based on company-specific characteristics rather than the differences in market structures.”

Others are more blunt: “If we have chosen to invest elsewhere in the Nordics than Finland, it’s been due to lower growth ambitions and poorer financial performance of the Finnish companies compared to their Nordic peers."

Finland’s strategic advantages: AI and clean energy

While caution still defines much of corporate Finland, the country holds two major strengths that could shape its next growth chapter: leadership in artificial intelligence and access to clean, affordable energy.

Nordea economist Juho Kostiainen captured the moment well:

“Finland has had a few challenging years, but we’re starting to see the positives. We’re frontrunners in AI usage (EIB Investment Survey, EIBIS), and we benefit from one of Europe’s cleanest and most affordable energy mixes. These are powerful structural advantages.”

“That’s a competitive edge Finnish organizations must leverage, and fast,” he added.

From stability to strength

For Finland, the next phase of competitiveness will depend less on cost efficiency and more on strategic boldness. The tools are in place: technology, capital, talent, and trust. What remains is a mindset shift.

“We’ve had challenging years,” Therman-Londen reflected. “But now we’re starting to see positive signals. The question is: do we have the courage to grow again?”

If Finnish companies can pair their digital and clean-energy advantages with a renewed appetite for risk, and treat M&A as a disciplined tool for transformation rather than a gamble, they can turn a decade of stability into a decade of strength. The potential is clear: to reclaim Finland’s place among Europe’s most dynamic, growth-driven economies.