Distinguished guests, Ladies and Gentlemen,
Many thanks to Professor Moberg and to the organising committee for inviting me here today. It is a great honour to speak at this scientific symposium organised by the Swedish Academy. I have been asked to speak on ‘How the ERC has changed the European funding landscape’. And I do believe it has, but we have to provide evidence and analyse why! This is a welcome topic in a conference dedicated to a key question for research and researchers: ‘How do we Assess Scientific Quality?’.
First one must get a basic understanding on the European funding landscape itself, and how it compares to others. In July 2017, solicited by Commissioner Carlos MOEDAS, Pascal LAMY presented, in the name of the high level committee he chaired, a report to the European Commission on maximising the impact of EU Research & Innovation Programmes. The report summarised the situation in Europe like this: “Europe is a global scientific powerhouse. It has all the necessary ingredients to shape a prosperous and safe future: 1.8 million researchers working in thousands of universities and research centres as well as in world-leading manufacturing industries, a suite of increasingly inter-connected research infrastructures, a thriving ecosystem of small and medium-sized enterprises and an increasing number of hotspots for start-ups. With just 7% of the world’s population and 24% of global GDP, it produces around 30% of the world’s scientific publications.”. Then the report went on to sound a strong warning: “But compared to other major economies, Europe suffers from a growth deficit which, together with the experience of uneven progress, fuels social disenchantment and political divisions across the continent. At the heart of Europe’s slow growth lies its innovation deficit. Europe does not capitalise enough on the knowledge it has and produces.”. So here we have a straightforward statement of an old idea known as “The European Paradox”. This phrase appeared in a European Commission Green Paper in 1995, but the underlying idea has been around much longer. Put simply: here in Europe, ‘we are good at research but not at innovation’. And as we can see, this idea still permeates policy at the European level to this day.
But is it true? This is an important question. The idea of a European Paradox carries obvious implications. If we are good at research, then everything is OK as far as research institutions and researchers working therein are concerned. A consequence of that would be: ‘We don’t need to do anything more about them; Maybe we don’t even need so many of them?’ Government action and funding should instead focus more on supporting innovation. That is why it is really important to examine such a narrative. Any policy based on a false or overly simplistic narrative will not help Europe and could even have considerably negative consequences. So is it true that Europe is good at research but bad at innovation?
Well, if we attempt a world comparison, it is still the case that no other region can match the scientific output of the EU. In 2016, the EU produced 27% of the world’s scientific publications, the United States 20%, China 17%, the developed Asian economies 7% with the rest of the world producing around 30%. And, if we look at the 2,500 companies that spend the most on R&D worldwide, 577 are EU-based companies accounting for 27% of the total, 778 US-based ones accounting for 37%, 339 Japanese for 14%, 438 Chinese for 10% and 368 from the rest-of-the-world for 12%. So, if we make the somewhat simplistic assumption that having more R&D intensive companies conditions having a strong economy, we can try a simple calculation. That is, the US and Japan manage to turn their share of science into a higher share of R&D intensive companies whereas the EU does not. And here pops up the Paradox! Many similar calculations have been made along the same lines.
If we really want to make policy decisions affecting millions of lives, then this level of analysis is not really good enough. In economics literature, the European Paradox is not considered a convincing analysis. Let us take, for example, the world share of the most influential scientific publications (defined as the top 1% most highly cited publications). Here the EU’s share increases to 32%. China and the developed Asian economies drop respectively to 9% and 3% of the most influential papers. But the US share goes up to 35%. So the EU with 27% of the world’s scientific publications produces 32% of the most influential publications, while the US with 19% of the total produces 35% of the most influential publications. This only makes sense if each US paper is on average more influential than each EU paper, and the figures just presented seem indeed to make the case for such a statement. So already removing one layer of the onion shows that much more is going on than the simple story told by the European Paradox.
And, if we delve deeper, we can get our hands on something, I think, even more interesting. In Europe there are around 3,000 higher education institutions and many other research performing organisations such as the CNRS in France, the Max Planck Gesellchaft and the Helmholtz Gemeinschaft in Germany, the CNR in Italy and the CSIC in Spain. Around half of the Higher Education Institutions are considered “research active” and around 850 award doctorates. These universities and research organisations employ around 900,000 public sector researchers. One should note also that much of the research funding available in Europe is institutional funding, i.e. funding attributed for the operating activities. It is usually not earmarked for specific activities of organisational sub-units. Instead internal allocation is left to the performing organisation. Institutional funding can be formula-based, negotiated or historical. What that means is that in many European countries project funding, defined as money attributed to a group or an individual to perform a research activity limited in scope, budget and time, is rather limited although the recent evolution has been in the direction to increase it, unfortunately often correlated with a sharp decrease of recurrent funding.
Furthermore, important differences persist between EU countries in terms of scientific output. Highly cited publications are concentrated in a group of leading countries predominantly in North-West Europe while Southern, Eastern and Baltic countries still rank lower despite some progress in recent years. By contrast, in the US there are only around 400,000 public sector researchers and only around 300 out of over 4,000 Higher Education Institutions award doctorates. Federal research funding is heavily concentrated on the most research intensive of these institutions. In 2014, 76% of federal research expenditure for Higher Education Institutions went to the 108 ones classified as “very high research” under the Carnegie classification. The top US universities also remain highly attractive to the best scientists from around the world. So, from this very quick “survey” we can readily see that individual researchers in the US have more resources on average, and crucially there is ample project funding available for individual researchers from multiple sources. There is a clear hierarchy of research institutions with the top ones having won a global reputation.
In the EU environment it is often more difficult for a researcher to develop a career, to achieve recognition and to secure funding to carry out his or her own research in particular for young researchers. So we can call ourselves a scientific powerhouse if we so wish. And it is true that, at the world level, our only current competitor is the US. But, given the structural issues in the EU’s public sector research base, it is not surprising that, in many areas of science, the US has managed to maintain a lead over many decades. Furthermore, it is clear that China is making huge efforts to catch up and achieves remarkable progress. One can say that, today, China “only” has a 9% share of top publications, but its share was less than 1% in 2000!
Now, this talk of a technology gap with the US and the rise of other scientific powers is even older than the talk of a European Paradox. But, actually, this one, I believe, is more well founded. For example, an influential analysis of European competitiveness in information technology and long-term scientific performance concluded that it is “the weakness in the scientific base that is responsible, indirectly and in the long-run, but in a powerful way, for the poor industrial performance.”  Now, I don’t want to suggest that one can replace a simplistic narrative with another. I am not saying: ‘if you are on the cutting edge of research, you will have a good economy’. It is clearly a lot more complicated than that, and this is why a comprehensive approach to these issues is needed. To give a few hints at other possible parameters: the roles of military technology and procurement to name one, market size, regulation and industrial structure have all played a part in the rise of big tech in the US. But let us not suggest that it is a coincidence that the US is ahead in terms of cutting edge IT research and the cradle of big tech companies, or just blame the linguistic heterogeneity of Europe and its fragmented markets, when it is well established that diversity is actually a resource.
The European Union’s answer to this situation has been the creation, more than 30 years ago, of the Framework Programme for Research and Development. The idea was that such a programme can address the fragmentation and lack of critical mass in Europe by setting up large-scale collaborative projects in priority areas. This effort has been ongoing since the 1980s. However, one can see that this type of funding does not address the structural weaknesses in the EU research system. Actually, after some time, this action reached its limit because of its somewhat artificial character and also of the clientele-prone aspect of the setting it created. This state of affairs triggered in 2000 the launch of the European Research Area (ERA) and the Lisbon Strategy, starting a period of reflection among the European scientific and policymaking communities on how to revise the strategy to best support research and innovation at EU level.
The emerging debate emphasised the central importance of basic research to the relative performance of the innovation systems of the US and Europe. The idea of a mechanism for funding basic research carried out by individual researchers at EU level therefore gradually gained traction. The top-down nature of the framework programme, its heavy bureaucracy and an excessive weight put on deliverables set at the time of submission, led many of the best scientists to turn away from it. This was precisely documented in several countries, France being one of them. This led the European scientific community to launch a (long) campaign to get an instrument that would take frontier research for what it is, namely an open-ended adventure.
After a rather convoluted process where several important players from academia, but also politics and the European Commission played a key role, one could arrive in 2007 at the creation of the European Research Council (ERC), the first simple science driven funding mechanism at EU level functioning in the least bureaucratic way. It was designed to raise the attractiveness of the European research system, give younger researchers room to develop their most ambitious projects and help Europe produce the very best cutting-edge science in new and rapidly emerging fields. By channelling resources to researchers selected for the first time through a truly pan-European competition on the basis of their best ideas, the ERC was able, and must remain able, to have a very high impact. A condition for this to happen was of course that the selection process be exemplary and involve the most qualified researchers coming from anywhere in the world. We are at the heart of the search for quality. This confers status and visibility on the best research leaders working in Europe and helps to attract and retain outstanding researchers there. This is something highly non-trivial because of the enhanced competition at world level due to the major investments made in particular by several Asian countries, among which China of course.
The results of the ERC calls also provide benchmarks for individual countries and research institutions to catalyse changes in national science research funding policies as well as institutional practices to make Europe a more attractive research environment. The ERC has already demonstrated a wide range of direct and indirect impacts across a number of important dimensions. Most clearly, the ERC is funding scientific breakthroughs and major advances with a number of ERC grantees receiving high-level distinctions and international prizes. Here in Sweden, I am of course tempted to highlight the 6 Nobel Prizes won by ERC grantees in only 11 years.
Let me list further impacts of the ERC on the European research system I personally consider key:
- The ERC is having a visible impact through its strong benchmarking function, due to the fact that scientific quality is the only criteria for the selection of proposals;
- Since now researchers know that to get an ERC grant one has to come up with a truly exciting idea, this leads a number of them, in particular younger ones, to try and formulate what they really dream of working on. Of course by far not all of them get ERC support to accomplish their dreams, but many recognise that this was the first time they performed this exercise and that it inspired them in the further development of their careers;
- The ERC Scientific Council has constantly put considerable emphasis in building up the next generation of researchers by dedicating 2/3 of its resources to researchers in the early part of their career. This meant for a number of them having access to a real scientific autonomy much earlier than it would traditionally be in their environment; putting trust in younger people lies at the heart of the ERC, and this has now widely impacted the scientific community in Europe;
- ERC panels take the ERC’s aim for high risk/high gain research seriously, deciding often to support projects that may have been refused at national or regional levels as too risky;
- The decision by the ERC Scientific Council to refuse to distinguish between pure and applied research retaining the expression „Frontier Research“ for the programme has proved very successful; ERC grantees have given many examples of the production of totally unexpected applications, with very concrete and sometimes spectacular effects in society; a solid proof of the validity of this approach is the share of ERC projects among EU-funded projects in Intellectual Property Rights is far greater than the ERC budget, share when one would have expected the opposite (29% versus 17% in the 7th Framework Programme, and an even higher difference in Horizon 2020); this is very far away from the image of researchers living in their ivory tower; actually, a significant number of them went all the way to create spin-off companies;
- One of the vehicles for this broader action is the Proof-of-Concept programme introduced by the ERC Scientific Council; it enables researchers, who, along the way of doing their research, see the possibility to get closer to markets or to respond to a societal need to be accompanied in their first steps; another positive way of encouraging researchers to explore new territories;
- The ERC has convincingly shown that more space must be reserved to a bottom-up approach, so much so that Commissioner MOEDAS borrowed the ERC model to build the European Innovation Council, and that the next framework programme Horizon Europe is a priori built away from the silos that were quite emblematic of the previous framework programmes; we must follow this open path and hope that the expression “co-creation”, used in the presentation of Horizon Europe, will be taken to heart;
- Another domain in which the ERC has, over the years, made significant progress is gender balance, showing that, with a careful and sustained attention to the processes, both the share of women applying and their success rates can be readily improved, up to the point that, for three consecutive years, women have had at ERC a slightly higher success rate than men, this of course while keeping scientific quality as only criteria; I personally hope this can inspire other funding agencies.
Another impact of the ERC that can be widely improved is the exploitation of the results coming from funding projects to nurture the European policy for research and innovation. This can be readily obtained by using the remarkable scientific competence and high level of knowledge gained by the ERC Scientific Officers due to their careful follow up of the scientific achievements of ERC-funded projects. It can also be enhanced by creating reference conferences around ERC grantees and highlighting their results, open of course to other scientists. On this basis it is of course of critical importance to make sure that all conditions are gathered for this impact to continue. And for this, one has to identify them.
A critical reason for this success of the ERC: its governance has been given to an independent Scientific Council in charge of the overall scientific strategy and with full authority over decisions on the format of the research to be funded, and its evaluation. This guarantees its credibility in the scientific community as well as the effectiveness of the ERC’s scientific programme, the focus of its operations on serving the scientific community in the least bureaucratic way, and the integrity of the peer-review process.
In 2015 the ex-post evaluation of FP7 put in place by the European Commission stated the following about the ERC: "The IDEAS programme has been, overall, highly successful. It has produced remarkable scientific results in a relatively short time-frame. It has used the resources available effectively and efficiently. It should be continued and possibly expanded. The European Research Area has long been in need of this institution. By and large, the superiority of the US research system with respect to the European one, in the last two or three decades, can be explained as follows: in the US there has been half a century of systematic, comprehensive, tough ex-ante competitive selection process, largely based on peer review, at federal level. The large size of the competition has forced all researchers, with no exception, to fight for quality of research and, where possible, for excellence. Several decades of this institutional design have shaped the research system deeply and irreversibly. In Europe, on the contrary, the ex-ante selection process has been based in most cases on panel-based ministerial decisions, inevitably associated to considerations other than peer review. The size of the pool has been traditionally small, the intensity of competition rather limited. In the initial decades the European research policy, due to limitations in the legal framework, has been largely based on networks and coalitions of institutions and teams. While this policy orientation has been extremely valuable in capability building and networking, it has not created the intensity of competition experienced in the USA. The ERC has been the first step in changing this state of affairs. The initial results are remarkably positive and reinforce the rationale from which it has been created."
So in conclusion, I think one can reliably claim that the ERC has had a major impact on the European funding landscape. And one of its actions has been to change the narrative of European research policy. It is now proven unjustified to decouple research and innovation and focus on only one aspect.
I will leave you with the words of the OECD’s latest innovation strategy I could have written myself almost verbatim. “Public research plays a key role in innovation systems by providing new knowledge and pushing the knowledge frontier. Universities and public research institutions often undertake longer-term, higher-risk research and complement the activities of the private sector.” The strategy calls on governments to, “Think long-term: Many of the key technologies driving growth today, including the Internet, mobile telephony and genomics, would not have been possible without public funding of long-term research… Innovation policies must look to the long term to answer major challenges like climate change and ageing.” The only words I would add are: “Nothing of importance can be done on these matters without the direct and genuine involvement of the scientific communities.”
I thank you for your attention.
1 “Lab – Fab – App”, July 2017 | 2 Science Research and Innovation Performance of the EU, January 2018 | 3Analysis of public sector research institutions in Europe comes from Innovation Union Competitiveness Report, 2011 (Part II Chapter 1).
4OECD Main Science and Technology Indicators. | 5PREF Study – Analysis of national public research funding | 6 US National Science Board Science and Engineering Indicators, 2016. | 7 OECD Science, Technology and Industry Scoreboard, 2017 (Section 3.4 “Scientists on the move”). | 8 Bonaccorsi in Science and Public Policy, August 2011. | 9 “How the European Research Council came to be”, December 2016 http://sciencebusiness.net/news/80035/How-the-European-Research-Council… | 10Europe and Basic Research, European Commission January 2004. http://cordis.europa.eu/pub/era/docs/com2004_9_en.pdf | 11The European Research Council—A European Renaissance, May 2004 http://journals.plos.org/plosbiology/article?id=10.1371/journal.pbio.00… | 12 Frontier Research: The European Challenge, ERC High Level Expert Group February 2005: http://erc.europa.eu/publication/frontier-research-european-challenge-h… | 13The OECD Innovation Strategy, 2015 revision http://www.oecd.org/sti/innovation-imperative.htm