Key Points

The report, titled 'Most Innovative Companies 2025: In Disruptive Times, the Resilient Win', explores insights from two decades of BCG's innovation research.

Based on an analysis of the firms that have appeared on BCG's annual 50 Most Innovative Companies lists since 2005, the report found a strong link between long-term innovation excellence and total shareholder return (TSR).

Top innovators outperformed the broader market by 2.4 percentage points annually on average, with particularly strong gains during the Great Recession and the COVID-19 pandemic.

"The ability to innovate through adversity is what separates exceptional companies from the rest," said Justin Manly, a BCG managing director and senior partner and a coauthor of the report.

"R&D spending alone isn't enough. What matters most is investing in the right initiatives and capabilities to turn uncertainty into opportunity."

China and India lead in innovation prioritisation with 95 per cent of their respondents reporting innovation as a top-three priority in 2024.

Digital maturity has become table stakes for innovation success. BCG's analysis of corporate earnings call transcripts found that mentions of digital innovation doubled from 2005 to 2024.

As companies face increased geopolitical uncertainty, the report outlines four questions to help business leaders prepare for a potential post-globalisation world: ambition, portfolio, talent, and footprint.

"The best innovators don't just weather the storm--they redesign the ship while sailing through it," said Amy MacDougall, a BCG partner and a coauthor of the report. "This is the moment for bold action to future-proof innovation systems."

- ANI