A global report has found that Australian business leaders do not appreciate the fact that Australia is among the world’s best countries for supporting innovation.

At the same time the federal Labor-led government has praised the fact that Australia has been recognised as one of the most innovative countries in the world.

US-based technology company General Electric (GE) has released two reports covering innovation in 22 countries including Australia.

The Milken Innovation Report, prepared for GE by US economic think tank The Milken Institute, ranked Australia among leading nations for its performance in such measures as patent production, collaboration between industries and academia and business environment.

However, GE’s Innovation Barometer report, a survey of 2800 executives of large companies, found that international perceptions of Australia as an innovation leader are low and that Australian executives feel their nation’s innovation environment has not improved in the past five years.

Michael Ackland, GE’s vice president of strategy and growth, Australia and New Zealand, said the attitude of Australian business leaders to their local innovation environment was among the most negative in the world.

“Both reports highlight the importance of innovation to strengthening the Australian economy, but they are poles apart in assessment of the local commitment to research and development,” Mr Ackland said.

The Milken report said Australians were “fairly negative regarding a number of areas where the nation actually performs quite well”.

“These perceptions do not completely match up with the improvements Australia has made to its innovation system,” the report said.

Australia was ranked as a leader in university-industry collaboration, with Milken noting the federal government’s $3.5 billion outlay on establishing 44 cooperative research centres.

The Acting Minister for Innovation and Industry, Senator Chris Evans, said “these results are broadly consistent with the findings of the Australian Innovation System Report, 2011, (AIS) which is an annual report on the performance of the national innovation system.”

However, GE’s Innovation Barometer found that only 64 per cent of respondents said it was easy for companies to partner with universities.

The finding mirrors the federal government’s own Innovation System Report, released in 2011, which found Australia ranks low among OECD countries for collaboration on innovation.

Senator Evans noted that while broadly consistent with the AIS report, the levels of university-industry interaction and of venture capital deals are still well below the Gillard government’s expectations.

To help stimulate improved links between university research and business innovation, the government announced a new $249 million Industrial Transformation Research program last December.

“The Gillard government recognises the importance of innovation to productivity and the development of a balanced and diversified economy,” Senator Evans said.

“That is why the government’s new R&D Tax Incentive is also encouraging companies to undertake genuine research and development by doubling assistance rates for small and medium enterprises and increasing assistance rates for large firms by a third.

He said 8400 companies were registered to participate in this major innovation program.

“This is another example of how a government with a clear innovation agenda, that is responsive to business needs, is making improvements to Australia’s business environment.”

Mr Ackland said the reports had revealed that Australian executives understood the role innovation would play in making Australia more competitive internationally.

It also showed that they believed small and medium-sized businesses had opportunities to compete in innovative technological developments.

Energy and healthcare were key areas nominated by Australians as innovation hot spots for the nation, and GE is a major player in both these sectors.

Mr Ackland said the reports would feed into GE’s global investment strategies, albeit along with a range of other factors.

“As a multinational we need to look far and wide for where the best ideas are coming from,” he said.

“The days of a company consistently developing breakthrough innovations on its own, without collaboration, are gone.”