The government’s recent report examining funding and strategic governance of New Zealand’s Crown Research Institutes (CRI) echoes what has been known for years by most participants in the nation’s technology innovation system. The existing funding model is broken and there are too many stakeholders, resulting in inefficiencies. But restructuring the bureaucracy alone will not be sufficient to ensure better returns from State investment in science.

The CRIs are tasked with a variety of social and economic objectives that range from enhancing and protecting the value of our primary sector through to identifying and managing environmental risks. A profit based model and traditional business metrics clearly does not work. The convoluted bidding process for funding of limited duration also does not ensure good science gets done; in some cases it actually impedes the process.

 There is certainly no shortage of excellent scientific research being done within these institutions right now and there remains potential to spin off more baby companies in the future. Here’s a few examples.

• There are two existing spin-offs involved in high temperature semi-conductors and cable technology, an area that has huge economic returns and is largely untapped.
• Last year’s New Zealand young scientist of the year (and W2W event  speaker) John Watt is working with CRI staff to look at the commercial applications of nano-particles in reducing motor vehicle emissions.
• Government owned companies are sitting on huge amounts of seismic data that has the potential to attract oil and mineral prospecting, with comcomitant economic benefits.

But the CRIs encountered problems in the past through attempting to self fund the commercialisation of new science. Attracting smart money and building linkages offshore  must surely be the key to growing our knowledge based companies faster. The CRIs will have to find a new business model that reaches out globally, whilst balancing the need to retain some control of intellectual property and return value to NZ. They also need to make this process happen a lot quicker than in the past.

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