Trustees' Report and Financial Statements 2019-2020

Home , Akshay Venkatesh, Anant Parekh, Anne Osbourn, Benjamin Blencowe, Bernie Fanaroff, Brian Cox (physicist)

STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION 1 SCIENCE SHAPING THE WORLD WE LIVE IN Science Shaping the world we live in Trustees’ report and financialTrustees’ statements for the year ended 31 March 2020 31 March ended year the for 2 THE ROYAL SOCIETY TRUSTEES’ REPORT AND FINANCIAL STATEMENTS SCIENCE SHAPING THE WORLD WE LIVE IN 3 Contents About us

STRATEGIC REPORT STRATEGIC REPORT About us 3 The Royal Society’s fundamental President’s foreword 6 Executive Director’s report 8 purpose, reflected in its founding Public benefit statement 10 Charters of the 1660s, is to recognise, Charity Our strategy at a glance 12 promote and support excellence As a registered charity, the Royal Society undertakes a range of activities that provide Where our income comes from and how we spend it 14 in science and to encourage the public benefit either directly or indirectly. These include providing financial support for scientists development and use of science for at various stages of their careers, funding STRATEGY IN ACTION

programmes that advance understanding of our GOVERNANCE Promoting excellence in science 16 the benefit of humanity. world, organising scientific conferences to foster How the Society has supported discussion and collaboration, and publishing the response to the pandemic 20 scientific journals. Supporting international The Society is a self-governing scientific collaboration 22 Future Leaders – Fellowship of distinguished scientists African Independent Research (FLAIR) Fellowships 26 drawn from all areas of science, Demonstrating the importance technology, engineering, mathematics The Society has of science to everyone 28 Fellowship and medicine. three roles that are Climate and biodiversity 32 As a fellowship of outstanding scientists key to performing FINANCIAL STATEMENTS embracing the entire scientific landscape, the GOVERNANCE its purpose: Society recognises excellence and elects Fellows and Foreign Members from all over the world. People 34 The Society has played a part in some Financial review 40 of the most fundamental, significant Principal risks and uncertainties 46 and life-changing discoveries in Governance 50 Statement of Trustees’ history and Royal Society scientists responsibilities 53 – our Fellows and those people we National Independent auditor’s report 54

fund – continue to make outstanding academy OTHER INFORMATION FINANCIAL STATEMENTS contributions to science and help to As a national academy, the Society represents the UK and collaborates with international Consolidated statement of partners to advocate for science and its financial activities 56 shape the world we live in. benefits. It provides authoritative and Consolidated and charity independent advice on matters of science balance sheet 57 that support the public good, including policies Consolidated statement that promote excellent science and scientific of cash flows 58 issues that inform public policy. Accounting policies 59 Notes to the financial statements 63 Reference and administrative details 87 Discover more online at: royalsociety.org STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION 5

report SCIENCE SHAPING THE WORLD WE LIVE IN 1,472 downloads of the iHuman 212 programmes, into staff organised services trading sections and 11,513 members of the public attended the Society’s Exhibition Science Summer 1,065 currently supportedresearchers the by Royal Society through its research fellowships 61 new Fellows and Foreign Members elected, women 13 including

m times The Society’s People Science of videos received more than 41,784 digitised archives our pages from Ata glance £133.7 total expenditure, 17% increasefrom 2018/19 30m Papers journals our from over downloaded were 1,913 participants the at Society’s internationally renowned scientific meetings 725,000 views on YouTube

1797 Edward Jenner Edward FRS unveils a new weapon in the fight – against smallpox will It vaccination. to lead eventually the eradication of the humans. in disease LOOKING FORWARD: 2021 FORWARD: LOOKING The Royal Society will continue to scientificconvene experts urgently to support the response to the global scientific new provide and pandemic advice as it evolves. Fellows begin ‘conversaziones’ ‘conversaziones’ Fellows begin opportunity an demonstrateas to cutting-edgetheir the to research rest of the Fellowship. These have have These Fellowship. the of rest annual the into developed since Exhibition. Science Summer public 1778 The Data Evaluation Learning Data and The group Viral Epidemics (DELVE) for is convened by the Royal Society in COVID-19 the pandemic. to response 2020 1851 The UK government awards awards government UK The Societythe its first annual £1,000 of grant government to be distributed for ‘private individual scientific research’. 1872 , its first fully The launch of the HMS Challenger expedition, scientific new a discipline of creation the heralds Society Royal the by Organised oceanography. – Admiralty the vastlyand voyage the increased ecosystemsidentified and ocean knowledge of species. marine 4,000 new over

1736 The Copley Medal is established an is Medal from Copley The endowment of £100 received from the estate of Sir Godfrey Copley in 1709. It is the prestigious a oldest scientific world’s honour, Nobel Prize. the of forerunner 2011 ‘open access’ journal. access’ ‘open The SocietyThe publishes Open Biology The first Foreign Secretary of the Society is appointed, years 59 before appoints government UK the its first Foreign Seretary. 1723 1928 Alexander Fleming FRS FRS Fleming Alexander antibacterial the effectrecognises its and significance, penicillin, of following his observations of wounded the among infection of the First World War. The Royal Society University Royal FellowshipsThe Research opportunities early create established for to are scientistscareer within universities. UK Many University Research Fellows have gone on to field. their leaders in become 1983 1964 Royal Society Wolfson Research Society Research Wolfson Royal Hodgkin, Dorothy Professor, female only UK’s the becomes Nobel scientist. Prize-winning . This recognised the

Sylva THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS

1662 impact of humans on the natural world and sustainability. for need the The Royal Society its publishes Royal firstThe book, Evelyn’s John

4 1947 founded, following a lecture a following founded, Christopher Wren. by The Royal Society is 1971 1660 Two yearsTwo after the election of the first women to the Royal Society, Mary Lucy Cartwright becomes firstthe female mathematician elected to the is She Fellowship. her for recognised workpioneering in what would later be known as chaos theory.

John Vane FRS Vane John the how elucidates effective substance acts aspirin in an as anti-inflammatory inhibits in and pain the human body. paves research His the way for the of development drugs useful other treatments.and Our heritage STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION 7

the technology and ethical issues raised by the development of neural interfaces – electronic devices nervous our to systemslinked that greathave potential in medicine already exacerbate also but could strong inequalities in society. We international an convened also commission with the aim of principles,developing criteria and standards the for clinical use of genome editing of the human germline. so innovation promise and Science many improvements the to way we live but they also bring significant can tell ethical challenges. Science us what can we do but it is up to society decide to what should we do. Over the our past Fellows year, and the people fund we continued have findto new ways benefit to society. The Royal Society has continued to help people understand what the choices and are give to them the means by which they can decide what directions go we in. In a year that ended with great challenges for us all, science offers us hope the for future. President of the Royal Society Venki Ramakrishnan Venki SCIENCE SHAPING THE WORLD WE LIVE IN account the long-term aspirations of scientists their families. and Investment in science is essential for the health, wealth happiness of and the nation. That was one of the key messages that the Royal Society put politiciansto in the general election. It is a message that has hit home, with the main parties making a significant increasing commitmentto investment in science. In March, the Exchequer of the Chancellor committed more to than doubling investmentgovernment research in and innovation by the end of this parliament. The Royal Society is an important part of delivering that investment in science, and over the past year increased have we our investment outstandingin scientists from £84.7 million £102.5 to million. The people invest we in pushing are the understanding, human boundaries of as our Charter from 1660 describes, thefor benefit of humanity. Science impacts our lives in so many ways. This year the Society has published reports technologies on that can help us decarbonise our change tackle and economy climate and set out ways support to people developto the data skills that will prepare them the for jobs of the future. published We a report on before it.before Avoidingpotential damage scienceto from a bad Brexit and the general election and what a for mean would government new science also were high on the Royal Society’s agenda. continuedWe the make to case thefor best possible outcome for science as leave we the European outward-facing,Union. The international nature UK of science has never been more important challenges. global tackling in but global are that Challenges that very have real impacts on the everyday lives all of of us – on our health, on the way live we our lives the economy. and jobs on and The UK has always beenoutward looking on science have – we thrived welcoming by the best people from aroundthe world cometo and work with our own outstanding talent. homegrown That has been threatened by Brexit andcontinued have we highlight to this problem the to government. In January, Downing Street Global new Talent a announced the Visa. listened to government The delivered and community, research an important first step in creating the visa system that need we to attract to continue scientific global talent – one that is welcoming, faster and more flexible, and takes into In a year that ended with great challenges challenges with great ended that In a year usfor all, offers science us hopefor the future.”

R 21. – 20 pages on more ead government advisorygovernment such groups as the Scientific Advisory Group for (SAGE). Emergencies As a scientific publisher, the Society also made all COVID-19 data and findingsresearch immediately and freely available. also have We done what can we help to support young people when schools closed, were resources our drawing together that could be used support to home technology, learning science, in engineering maths. and The pandemic arrived towards arrived pandemic The towards the end of the 2019/20 financial dominate doubt will no and year on thinking looking back when this period. much went However, Over the past year we have ourincreased investment in outstanding scientists from million£84.7 to £102.5 million. £102.5 to handling of the pandemic and the the fore.” to been Society has Royal Science has been central the to

In addition individual to Fellows contributing directly advice to within and government, to the Society support to groups three convened the understanding of the science of the virus and help inform the policy the that government decisions was taking. The Society brought: modelling expertise diverse a from range disciplines of support to the pandemic modelling community; multi-disciplinary expertise to support a data-driven approach to different from learning approaches the pandemic; managing the and to expertise of our Fellows provide to rapid science advice on topics tackling the pandemic. to relevant while independent groups, These of the government, also have been providing their expertise to

THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS

6 Science has been central the to the the and pandemic of handling Royal Society has been the to fore. Our Fellows and people who we the contributing global to are fund effort tackle to COVID-19. A long- term investment in science has allowed us rapidly to develop our understanding of this virus and make treatments developing on progress vaccines. potential and The world in April 2019 was very different from the world in March COVID-19 global The 2020. impacted has pandemic everyone, with millions of confirmed cases and hundreds thousands of of recorded deaths. Societies, including the UK, spenthave months in lockdown with theirpeople families from separated operate. to unable businesses and

President’s President’s foreword STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION 9

Read more on page 28. page on more Read Read more on page 16. page on more Read 22. page on more Read highest quality. theDemonstrating importance of science to everyone culture by influenced is Science developments other inand just scientificsociety, as thinking innovation influenceand how people live their lives. It is important that the Society withengages groups different in society and with the public in out find aboutgeneral to their their listen to to experiences, views science and make to part of wider conversation. Promoting excellence excellence Promoting The Society’s aim is harness to that scientific work is of the Supporting international scientificcollaboration inherently an is Science activity.international The Society’s the aim is reinforce to importance of science build to partnerships between nations and international relations promote to and culture in role science’s and society. the expertise of its Fellowship to science in that excellence ensure supported and and recognised is in science Our strategic plan

SCIENCE SHAPING THE WORLD WE LIVE IN . A record-

Executive Director of the Royal Society wi Dr Julie Maxton Our Summer Science Exhibition Science Our Summer saw over 11,500 members of the public of programme attending packed a Carltonevents our in House Terrace Anotherbuilding. 3,000 people ablewere visit to and find out more historyabout our London’s during Open House alsoWeekend. We had digital engagement, withexcellent channelsincreasing social our all by around 20% on last year and our website having 1.8 million users. Our books go from prizes strength to strength, with Caroline Criado Perez winning the Royal Society Science Book her for book Prize Invisible ExposingWomen: Data Bias in a DesignedWorld for Men around from 10,600breaking children the UK cast their choose votes to Museum the to Welcome Planetarium: by Raman Prinja and Chris Wormel People’s Young our theas winner of Book Prize. The year ahead looks be to very different fromthe last as the Society will continue We operates remotely. engageto with the public by using digital formats some for of our engagementpopular activities public holdingand virtual events online. Much of our work will be able to continue as planned, but remotely, such as electing our Fellows, judging journals publishing book prizes, our we and fundingand researchers will use our convening strength to innovation and research advocate for and support to the scientific response the pandemic.to

We continue to influence continue to We policy- makers and three reports key which illustrate published lastwe year our work in this area. Our reports on green ammonia, data science and new how interfacesneural showed technologies and ways of working can transform different aspects of science in the and the future. Our You Planet series of public events were debate public shape help to designed biodiversity. and change climate on with along National US year, This National and Sciences of Academy Academy of Medicine, convened we on commission international an heritable editing genome human representatives together that brought the world. countries around from findingsThe the commission of will be published in 2020. with scientificWorking leading nations is an important part of our remit. The Royal Society’s Foreign Secretary and I visited Beijing for high-level meetings withnational organisations,science ministries and the private sector, as part of the Society’s strategic engagement with China. The trip also set the scene for a year of work with China, including a discussionforum with Science exchanges Zhigang, Minister Wang on a range of topicswith province- academies, the and science level translation selected Chinese of into policyscience reports. Our Partnership Grants scheme supported schools 49 and colleges, and over 8,400 students from primary and secondary level across the UK with up £3,000 to buy to equipment runto an investigation project in partnership with a STEM professional industry. or eitherin research Following a focus on promoting the scheme in Northern Ireland, have we applications in increase an had in from schools2020 in the region.

People of Science our T films launched yearthis of the stories tells and extraordinary scientists, ofusing our archive artefacts.”science the Fellowship, but making are we areas. some in progress In scientific publishing, papers our in 30 downloaded over were journals times.million Our scientific meetings together brought has programme expertsleading the discuss latest to research and develop to knowledge of their field. This year could we not the to due programme our complete planning now pandemic, are but we meetingsfor place take to virtually. continued have We highlight to the threats UK to science if there is no deal with the and EU make to the case investment for in science. This year saw the new Government commit more to than doubling public investment research. in “ of series second he Grant-giving is the main way that we we that way Grant-giving the main is continued support have scientists, but we our increase engagementto with industry, encourage international collaborations and strengthen capacity research in countries.” developing £102.5 million to fund exceptional fund exceptional to million £102.5 outstanding and researchers scientists, of increase which an is 21% from the More previous year. currently are than 1,065 researchers supported by the Society through its fellowships. This year research also saw our first FLAIR fellowships supportingawarded, early career Africa. in researchers Our work elect to top scientists to Fellowshipour continues. This year, two temporary new nominating established increase were to groups that are groups nominations from because of under-represented location, or and gender ethnicity, from those working in industry. There is clearly still more work to be done increase to the diversity of

THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS

Director’s report Executive In the year leading the up to our increased pandemic, we expenditure by 17% £133.7 to million recognise to continued we as scientific providing by excellence financial support scientists for at various stages of their careers in the UK and internationally. awarded We This year has been another year of growth the for Royal Society but one that ended with the disruption severe pandemic. coronavirus the global of in building our closed Lockdown some down shut and London central of our programme activities, of but continuedwe much of our work from homes. our Asour from will see you and science Foreword, President’s the Royal Society been have at the heart of the response COVID-19. to STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION 11 SCIENCE SHAPING THE WORLD WE LIVE IN Summer Science Exhibition 2019: Living on the moon exhibit. Above: f or p p p s r p scientists at various stages of their careers in the UK and internationally; that advance research understanding world; our of advanceto scientific discussion discovery;and advice policy to makers; teachingof STEM subjects and supporting teachers be to part of the scientific community; internationally;science and the with public science. excellence; • • and programmes unding • meetings discussion ganising • roviding expert scientific • romoting in excellence the • romoting the importance of • engage to programmes taging The activitiesThe that the Society undertakes to and its science promote benefits, for the ultimate benefit include: humanity, of • ecognising scientific • roviding financial support for

i i t t i of the Society’s Fellows act as a source inspiration of what for can achieve. science individuals roles and in key with relevant expertise address to major issues in science and wider society; and which includes world leaders world includes which scientific all across fields; disciplines; this removes leading barriers enables and scientists in different fields to come together; other and government the allows organisations Society provide to science advice that is unfettered by other interests; • ts ability convene to groups of • ts history and the successes • he expertise ofits Fellowship, • he breadth ofits scientific • from ts independence The SocietyThe has a number of attributes further that help to its mission:

THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS

10 and as a registered charity. The Society furthers its mission through its three roles: as key a fellowship of the world’s most scientists;eminent the as UK science; academynational of The Society’s mission is to support and promote recognise, inexcellence science and to and theencourage development use science of the for benefit of innovation and Research humanity. and economic,advance social our cultural well-being, health provide benefits sustainable to and key are long-term growth. economic The Society is concerned with excellent whomever by and wherever science, it is done, and is committed to diversityincreasing science, in engineering and technology, mathematics (STEM). Public benefitPublic statement STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION 13 .

SCIENCE SHAPING THE WORLD WE LIVE IN The public, including children and young people young and public, children The including Award FLAIR fellowships to help build research capacity in sub-Saharan Africa. Convene scientificexperts to support theresponse to the global pandemic and provide new scientific advice as it emerges. Provide evidence to policy makers on climate and biodiversity, future land use in the UK, data and Artificial Intelligence (AI), areas. emerging other and technologies genetic innovation. and investment research increased in for Advocate using the Society’s programme engagement Redesign public digital channels. partnershipLaunch grants support that consider to schools biodiversity. and change climate around issues careers future mathematics for skills people’s Boost young Continue to increase funding for research fellowship schemes fellowship research funding for increase Continue to the UK. to researchers early career and senior for outstandingRecognise scientific theachievements through programme. awards and medals and Fellowship support and industryEncourage through innovation fellowship schemes. residence in entrepreneurs and Deliver a programme of scientific events. Broaden participation and increase the diversity of the scientific workforce. Transition to a sustainable open access publishing model. Engage with European partners to promote collaboration researchers. between European UK and Continue to advocate for the UK’s inclusion in the EU research programmes.framework scientific with policy leading engagement and scientific Deliver nations, such as China, the USA, Brazil and India. Participate G20 and Commonwealth in G7, Heads of Commonwealth a Meeting (CHOGM) develop Government and Conference. Commonwealth Science a including Programme, UK researchers and betweenFoster collaborations international programmes. grant international through

• 2021 Goals for • • • • • • Goals for 2021 Goals for • • • • • • 2021 Goals for • • • • • and the science community films. Engaged Fellows, staff, volunteers Fellows, Engaged . Industry, academia, education and civil society Staged a programme of public events in London and around the country, including a series and the planet of You events. Saw an increase in visitors of 13% for the Summer Science Exhibition. reports and interfaces, neural key ammonia on Published science. data Pressed for a review of post-16 education. Launched a second series of the People Science of Delivered vital work in supporting the response to the pandemic. Increased spending on grants from £84.7 to over £100 million, researchers early career of the number increasing including and the value of awards across flagship programmes. This includes the University Research Fellowships (URFs) and the schemes. Professorship Hodgkin Research and Dorothy Shown the value that investment in research brings to the UK, it that announcement illustrated the government’s is in which will invest £22 billion a year in research and innovation by 2025. with engagement industry, twoIncreased holding new ConnectionsCreating events. Increased the nomination of candidates for the Fellowship from industry, in working those and groups underrepresented including a 12% increase in the total number of women nominated. develop to commission international an Convened principles, the possible standards use clinical and criteria for editing. genome germline human of Worked with the African Academy of Sciences to award the first ever FLAIR Fellowships and selected the second cohort awardees.of Continued to call for the best possible Brexit deal for research. Built on scientific partnerships by taking a delegation to China and hosting the 5th Joint Science Conference of the Process Balkans Western

What have we achieved? we What have • • • • • • What have we achieved? we What have • • • • achieved? we What have • • • •

and procedures Robust systems, policies Inspire through historic collections. Proactive engagement on major issues. Proactive major on engagement challenges. global Address Partner onnations scientific with leading new technologies. Implement Commonwealth programmes. to meetings international leading Convene science. advance Increase scientific advicefor policy makers. New programme of public dialogue and engagement. and culture. debate public into science Integrate Promote the value of STEM education. Elect exceptional scientistsElect the exceptional Fellowship. to landscape. the research Advise on Demonstrate impact science the economic of investment. outstandingFund researchers. scientificachievements. Recognise support and Encourage innovation. research. scientific Publish

• Supporting international collaborationscientific • • • • • Demonstrating the importance of science to everyone • • • • Promoting excellence excellence Promoting in science • • • • • • • Government, parliament and key influencers funders and key and parliament Government, Strategic priorities governance framework governance Royal Charter and strong

THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS

Resources Relationships National academy National Fellowship Inspiration Our roles Charity Collaboration Diversity inclusion and Integrity Our principles Independence Nullius in verba – take nobody’s word for it. Our motto Our mission promote To andscience its benefits.

12 Our strategy at a glance STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION 15

£4.4m

fees £1.1m recognising excellence in science £95.8m engagement £1.0m Direct costs on Support costs on Costs of trading Education and public Investment manager Promoting science Supporting and £2.3m raising funds £0.5m and its benefits £0.1m raising funds £0.5m Grants for charitable activities £108.5m Income and endowments from donations and legacies £0.8m

Expenditure on raising funds total Promoting excellence Promoting excellence in science total £96.9m SCIENCE SHAPING THE WORLD WE LIVE IN Total Total income £133.7m £129.8m expenditure

£22.9m advice for policy £4.3m Education and public engagement £3.5m Supporting and recognising in science excellence £6.8m recognising excellence recognising excellence in science £1.6m Fostering international Promoting science Supporting and Providing scientific and its benefits £0.1m and global cooperation £16.1m R

Other trading activities £2.0m £2.0m Trading in furtherance Trading of charitable activities £11.5m Other income investments Income from £0.1m £6.9m

40. page on more ead Demonstrating the importance of science to everyone total £9.5m Supporting international scientific collaboration total Expenditure is shown by strategic objective in the outer ring and by expenditure category as shown in the statement of financial activities in the inner ring.

s f excellence in science; in excellence and cooperation; Expenditure on charitable charitable on Expenditure activities million) (£129.3 Society’sThe charitable expenditure is categorised in the statement of financial activitiesfollows: as • promoting science and its benefits; • upporting recognising and • global and international ostering • providing scientific advicefor policy; education• engagement. public and Each of the areas above supports the delivery of the three strategic objectives as set out in the current strategic chart expenditure plan. The on the following page illustrates expenditure by both strategic objective category. expenditure and further to expenditure The the strategic objective of promoting includes the science in excellence majority grant of awards, the costs of the Society’s publishing operation and the costs associated with lettings at Carlton which House are Terrace furtherancein charitable of objects. Expenditure also includes this in area costs arising from recognition of the creativity and excellence scientists of by election the to Fellowship and MembershipForeign the and awards in scientists to excellence recognise to technology. and science Expenditure further to the objective supportingof international scientific collaboration mainly constitutes grant schemes, international on awards providing scientific advicefor areas of policyinternational expenditure and scientistsevents convening on from the world.across The majority of the Society’s demonstrate the to expenditure everyoneimportance to science of is in the form of providing scientific policy educationadvice and and for engagement work.public

incurred on raising funds and raising on incurred charitable activities. Expenditure Expenditure totalled the year for £133.7 Expenditure million. is Expenditure funds raising on million) (£4.4 Expenditure funds includes raising on the direct costs of raising funds, associated support costs, costs of investmenttrading management and fees. (£6.9 million) (£6.9 million) Other (£0.1 income majorityThe sources other income of contributions made financial to relates projectsto led by the Society. Income from investments from Income The Society holds a significant investment portfolio which was valued at £234.1 million at 31 March Manyof these 2020. funds held bequeathedwere the to Society as endowments or gifted as a restricted fund a specific for purpose. The investment objective of the Society Other trading activities (£2.0 million) SocietyThe Hall Chicheley acquired in 2008 with the aimof operating the property as a centre scientific for and In addition to academic conferences. its mission-related activities, the Hall other and events, hosted conferences and Royal Society Limited was Trading theestablished activities process to of the Hall. Royal Society (London) Ltd other established non-was process to charitable trading activities including agreements. sponsorship from income is at least to maintain thereal value of its investment assets while generating stable a sustainable and fund charitable to activities,return thus being even handed between beneficiaries. future and current

THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS

14 Trading in furtherance in charitable of Trading activities (£11.5 million) Income and endowments and Income legacies and from donations (£0.8 million) Grants charitable activities for funding, government additionIn to the Society receives valuable charitablecontributions towards activities long-term from partners such Foundation the Wolfson as Income The Society has a number of income the including government,sources, trusts, companies, foundations, individuals, trading activities and investments. from income Its income enables the Society deliver to a wide range of programmes in support of its strategic aims. Income the for year million. totalled £129.8 The Society has relied on the supportgenerous philanthropists of throughout its year history. This the Society received funding from trusts, companies foundations, the individuals additionand in to Fellows.contributions by made The Society is grateful all to its donors the on found can be their names and Society’s website. (£108.5 million) The Society receives the majority of its thefunding UK from government’s Department Business, and Energy for Industrial Strategy (BEIS). a In the year, grant was also received from the Department International for Development. and the Leverhulme Trust, as well otheras external bodies. from and how we spend it spend we how and from Where ourincome comes The SocietyThe undertakes trading activities in the form of publishing activities conferencing and journals that further its charitable objectives. STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION 17 6% 3% 3% 11% 34% 92% 370% 100% year period year Change over five over Change 6 10 49 73 278 700 284 2015/16 £53.5m 6

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26 64 135 280 803 290 2016/17 £61.2m Helen Alexander is working at the at working is Alexander Helen University Her research Edinburgh. of is on bacteria and how organisms the around environment to adapt them, especially when it changes such reasons for severely rapidly and as pollution or climate change. A key focus of her work is on the evolution of antibiotic resistance. Priorities We have also have We developed a range of activities support to the next leaders,generation research of including opportunities training, for networking. and mentoring funded by are schemes These government, partnership in with other philanthropic organisations, funding gifts and through the Society’s own funds. SCIENCE SHAPING THE WORLD WE LIVE IN 6 49 67 157 627 394 2017/18 1,300* £73.3m 7 – 59 48

103 345 328 883 2018/19 6 £84.7m

– 47 52 98 776 287 292 Grant-giving is the primary means by which the Society supports scientists and a range have we of schemes to support senior early and career scientists pursuing both discovery-led and applied research. invest We in industry innovation schemes, and work with partners overseas to support collaborations international strengthenand capacity research in countries. developing Ineke de Moortel is a researcher at the University of St Andrews. Her understanding on is why research hotter is atmosphere than the Sun’s its surface,fundamental is which to understanding the atmosphere. solar She uses a combination of high- observationsresolution large- and carry computational to models scale out a detailed comparison of different heating mechanisms. Priorities 2019/20 £102.5m

I Some the of people fund: we Gavin Salam is a researcher at the University of Oxford, working on particle physics. His work aims understanding the of improve to fundamental particles and laws of developing by achieved This is nature. high-energy of simulations novel to comparison particle for collisions data colliders, from CERN’s such Collider. Hadron Large Priorities The Society’s aim is to harness the expertise of its Fellowship to ensure that excellence excellence that ensure to its expertise of the Fellowship harness to is aim Society’s The quality. highest the of is work scientific that supported and and recognised is science in outstandingFund researchers In 2019/20 the Society awarded fund exceptional to million £102.5 outstanding and researchers scientists. inincrease an This is funding of 21% from 2018/19, as we continue increase to the scale of our grants programmes. Number grants of awarded researchers career Early and collaborations International travel Capacity building Industry, translation and innovation Established researchers Equipment and infrastructure and Equipment Total value Total * n 2017/18 270 one-off additional grants were awarded alongside a range of other new and one-off grants. From 2018/19 additional funding is largely incorporated into existing grants.

Encourage and support innovation. Publish scientificresearch. Elect scientists exceptional to the Fellowship. Advise landscape. on research Demonstrate impact economic investment. science of Fund outstanding researchers. scientificRecognise achievements. 1 7 3 4 2 5 6 Priorities:

THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS Dr Alyssa-Jennifer Avestro, Dorothy Hodgkin Fellow (2019 – 2023), researches the potential of organic materials to replace the toxic heavy toxic the replace to materials organic of potential the researches 2023), Alyssa-JenniferDr – Hodgkin (2019 Fellow Dorothy Avestro,

16 metals typically found in commercially available batteries, which could lead to ultra-fast to lead batteries, particularly could available – times which batteries typicallymetals with commercially recharging faster in important found for energy. renewable storage solutions for Above: excellence Promoting Strategy in action in Strategy in science STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION 19

Look for ways, working with working ways, for Look others, broaden to and participation science in increase the diversity of the scientific workforce. Continue transition to our publishing programme a to sustainable open access model. Continue to increase funding funding increase to Continue fellowship research for schemes attract to and retain outstanding early and senior UK. the to researchers career outstandingRecognise scientificscientists and election through achievements theto Society’s Fellowship and medals and awards programme. support and Encourage industry through innovation entrepreneurs and fellowship that schemes residence in promote interaction between industry. and academia Deliver a programme of scientific events that foster networking, and collaboration noting that some of these meetings will need take to virtually. place

• • Looking forward Looking The Society will: • • • • 2020/21

SCIENCE SHAPING THE WORLD WE LIVE IN

Publish scientificresearch SocietyThe high-quality, publishes cutting-edge supports and research open access publishing as part of our thecommitment widest to possible outposts. research dissemination of In 2019/20, of 2,954 41% of our papers which open access, published as were is above the of papers 35% published Papers open access. globally that are downloaded were journals our from over 30 million times in 2019/20. We published the first of a new type of article the in journals. Evidence synthesis articles the available review evidence on a given topic provide to a synthesis non-specialists for and rigorous,policy are They makers. objective transparent, and driven and stakeholder needs,by the enabling decisions. informed make to reader removed we ourIn March 2020, paywall help to researchers freely to COVID-19-relatedaccess papers on our also site. We created a COVID-19 listcollection comprehensive a – articles relevant of themed and to researchers allowed which issues content recent immediately evaluate in their own area of work. Priorities 3

2 A selection of Royal Society journals from 2019/20.

Above: and supportEncourage innovation Fifteen entrepreneurs, senior scientists business leaders and were in Entrepreneurs as appointed the 19 joining this year, Residence appointed 2018. in Society-funded Royal The scheme aims increaseto the knowledge UK in universities awareness and of cutting-edge industrial science, innovation. and research opportunities provides scheme The enthusiastic,for highly experienced industrial scientists entrepreneurs and spendto one day a week at a university bespoke a developing project. It covers all areas of the life including physicaland sciences, engineering. Priorities

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Foreign Member JohnForeign Goodenough was awarded the Royal Society’s Copley Medal. solid-state The the Nobel awarded physicist also was in ChemistryPrize his for discovery of lithium cobalt oxide, which led the to lithium-ion of development batteries, now widely used in devices such as laptops. mobile phones and the UK and produced a manifesto outlining the steps key the capitalise to take should government outstanding the UK’s on strengths in science. The Society also wrote to parliamentary withcandidates details of the economic impact of research in their region. The manifesto called for action areas,in six key includinga good Brexit outcome science for and full participation in Horizon Europe, the an programme, research European investment to of science increase into 3% of GDP by 2030 and delivering the right policies and funding achieve to carbon emissions. net-zero theIn Chancellor March 2020, of the Exchequer committed investing to £22 billion a year in research and innovation – a more than by 2025 doubling of the current £9 billion science budget. Priorities Priorities Recognise scientificRecognise achievements

21% 6 of new Fellows and MembersForeign womenwere (2018/19: 23%).

Demonstrate impact economic During general the election 2019 campaign, the Society all wrote to party leaders outlining the benefits innovation and bring that to research of science investment science of Advise landscape on research The Society advocated the for visa introduction the Global Talent of – a UK immigration category for individuals promising and talented in specific sectors wishingto work in the UK. The new visa was introduced in February allows talented and andindividuals the in research innovation sector enter to the UK for up five to years withoutrestrictions like salary minimum threshold sponsor, a requirements. language Royalor The Society is one of six endorsing bodies applicants.for Priorities

40% of grants were awarded to women women to awarded early our career in (2018/19:schemes 39%).

1 THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS

R 36. – 34 pages on Fellows

ead more: List of our new 29% of grants were women to awarded 29%). (2018/19: 18 Two of the 2019 Nobel winners Prize Two Fellowsare of the Royal Society, Ratcliffe, Peter Sir and Peebles James John Member, Foreign a is one and Goodenough. fourth A Nobel Prize previous a was Queloz, Didier winner, recipient of the Society’s Wolfson Merit Award. Research Two temporary nominating groups Two the established increase were to for candidates of nominations election the to Fellowship from because of underrepresented groups ethnicity, gender or where they work and from those working in industry. This year saw an increase of 12% in the total number of women nominated to the Fellowship. New Fellows been have elected from institutions across the UK and the was the and world ballot around the firstconducted digitally for time. The Royal Society electednew 61 Members, Foreign Fellows and one and women, 13 including Honorary Fellow. Elect scientists exceptional Strategy in action continued to the Fellowshipto Priorities 20 THE ROYAL SOCIETY TRUSTEES’ REPORT AND FINANCIAL STATEMENTS SCIENCE SHAPING THE WORLD WE LIVE IN 21 Strategy in action continued

How the Society has STRATEGIC REPORT supported the response to the pandemic

The Society’s fundamental purpose responses to COVID-19 and the is to recognise, promote and impact of reopening schools. support excellence in science and The Society joined a group to encourage the development of publishers and scholarly and use of science for the benefit communications organisations in a GOVERNANCE of humanity. This is clear from the joint call to maximise the efficiency way we have responded to the of peer review, ensuring that Dr Katrina Lythgoe is a Sir Henry Dale Fellow pandemic. key work related to COVID-19 is at the University of Oxford. Her research area Fellows of the Royal Society and reviewed and published as quickly examines the evolutionary epidemiology of viral infections and multi-level adaptation of people we fund are contributing to and openly as possible. human viruses. She uses data analysis to study the UK and global effort to tackle When schools closed across the viruses that evolve rapidly and that can have an COVID-19. They are working on country, the Society put together effect on entire populations and to study how urgent research questions, as well a list of resources, activities and IMAGE responsive they are to intervention strategies. as providing independent advice to videos that could be used to national and international decision Dr Ritesh Kumar is a Newton International support home learning in science, makers. The work includes research Fellow at the University of Hertfordshire . He technology, engineering and maths. on the biology of the virus and has used deep learning methods to predict the FINANCIAL STATEMENTS smell or flavour of molecules based on their therapies to combat it, longer term The Society is currently supporting physical, chemical and structural properties. His goals such as the development of 1,065 active research fellows across recent research included work on an enhanced vaccines and reviewing evidence to the UK through our grants schemes, understanding of the basis of smell, and inform policy decisions. plus hundreds of PhD students, assessing the relationship between respiratory postdoctoral research assistants The Society used its convening illnesses and loss of smell and taste. and technicians working across power to support the response to the natural sciences. Because of the pandemic by establishing three the pandemic, many researchers groups. The Rapid Assistance in are unable to progress their work Modelling the Pandemic (RAMP) and there has been some job initiative brings modelling expertise uncertainty within the research from a diverse range of disciplines to community, but other researchers OTHER INFORMATION support responses to the pandemic; have been working on areas linked the Data Evaluation and Learning to the pandemic or in related areas. Dr Daniel Streicker is a Sir Henry Dale Fellow for Viral Epidemics (DELVE) group, Others are using the changes to alumnus at the University of Glasgow. His a multi-disciplinary group, takes a our lifestyles that the pandemic research is on managing viral emergence at data-driven approach to learning has brought to carry out research the interface of bats and livestock, specifically about responses to the pandemic; Dr Paula Koelemeijer is a University Research around the transmission of rabies from vampire that would not have been possible and Science in Emergencies Tasking Fellow at Royal Holloway, University of London. bats to humans and livestock in Peru. His work before. – COVID-19 (SET-C) draws on She is carrying out research into understanding has also included how we can predict novel expertise to respond to requests for the landscapes of the deep Earth by analysing zoonotic diseases, which transfer from animals rapid advice on topics relevant to seismic signals at the Earth’s surface. She has to humans. tackling the pandemic. These groups been able to use the lockdown to study the have carried out work on issues impact of humans on seismic activity. such as the protection offered by wearing facemasks, immunological 22 THE ROYAL SOCIETY TRUSTEES’ REPORT AND FINANCIAL STATEMENTS SCIENCE SHAPING THE WORLD WE LIVE IN 23 Strategy in action continued

The Society’s aim is to reinforce the importance STRATEGIC REPORT of science to build partnerships between nations Supporting and to promote international relations and science’s international role in culture and society. scientific collaboration GOVERNANCE

Above: (left to right) Andrej Zhernovski, Deputy Minister of Foreign Affairs, Republic of North Macedonia; Julie Maxton, Executive Director, The Royal Society; Carole Mundell, Chief Scientific Adviser, Foreign and Commonwealth Office and Wiesław Tarka, Coordinator of the Poznań Western Balkans Summit, Ministry of Foreign Affairs, Republic of Poland, during the 5th Joint Science Conference of the Western Balkans Process.

Proactive engagement The data showed that the UK was The Society also hosted heads FINANCIAL STATEMENTS in major issues a less attractive destination for top of academies and universities The Society has worked with all international science talent and the from across the Western Balkans political parties to try to achieve the UK’s annual share of EU research in Carlton House Terrace as part best outcome for research and funding had fallen by almost a of the Berlin Process. innovation throughout the Brexit third since 2015. There was a drop In May 2019, the Society hosted the negotiations and the general election of almost 40% in UK applications 5th Joint Science Conference of the Priorities: to ensure that highly skilled scientists to Horizon 2020, with 35% fewer Western Balkans Process, bringing from around the world are still able to scientists coming to the UK through together stakeholders from education, 1 Proactive engagement in work in the UK. We aim to continue to key schemes. research and innovation. Working major issues. support and build relationships across This intervention secured strong closely with the German National Europe, and beyond, by reinforcing 2 Address global challenges. media coverage and political attention Academy of Sciences, the Leopoldina,

the importance of science in OTHER INFORMATION and was mentioned in Parliament and and the Foreign and Commonwealth developing partnerships between 3 Partner with leading scientific nations used by the Chair of the Science and Office, the event gave an opportunity nations and emphasising science’s on new technologies. Technology Committee to question to consider fresh expectations for role in culture and society. the Science Minister. research and education across 4 Implement Commonwealth We have also continued to warn Europe, to encourage collaboration programmes. We have since continued to advocate of the dangers of a no-deal Brexit across the European Research Area. for association with Horizon Europe, 5 Convene leading international and the damage this could cause The conclusions featured in a political meetings to advance science. highlighting the advantages of to UK science. In October 2019, we summit in Poland later in the year. association, urging ministers and published new data highlighting the special advisers to make public Priorities negative impact that uncertainty over commitments to securing association the UK’s future relationship with the EU 1 and successfully encouraging was having on science. opposition members to raise this with Above: The Royal Society team, FAPESP team, UK delegates and Brazilian delegates at the 3rd UK-Brazil Frontiers of Science held in São Paulo state, the government in both the Commons March 2020. and the Lords. STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION 25

with UK Commonwealth high high with Commonwealth UK meeting a and commissions the including programme, Science Commonwealth 2021. in Conference round second the Award of FLAIR fellowships help to capacity in research build sub-Saharan to and Africa challenges. global address Deliver a programme of of programme a Deliver scientific policy and with leading engagement scientific as such nations, China, the USA, Brazil and India. appropriate Participate in as multi-lateral such fora Commonwealth a Develop Programme include to a academies Commonwealth network, position joint engagement development, G7, G20 andG20 CHOGM,G7, and including issue-related fora UN the climate for preparation biodiversityand conferences. Foster collaborations collaborations Foster and between international its through UK researchers programmes. grant international Develop a programme of of programme a Develop scientific with engagement partners European promote to collaboration continued between UK and European after UK the leaves researchers the EU. UK’s the advocate to Continue inclusion research the in EU programmes. framework

• • • • • • Looking forward Looking The Society will: • 2020/21 SCIENCE SHAPING THE WORLD WE LIVE IN . 5 1

26 meetings held were with 1,913 attendees and 490 speakers Priorities Topics this yearTopics included: Restoration for relevant science action; Continuous-time quantum computing and simulation: perspectives and challenges; Crossroads between transposons and gene regulation; and Future exploration the of giants ice

The Society has continued to engage with scientists and policy the Commonwealth. across makers Plans underway are the for first ever virtual Commonwealth February in Conference, Science 2021, as it was no longer possible conveneto the event in Nairobi as planned because of the ‘feeder meetings’ pandemic. Three in Jamaica, Rwanda and Fiji were also postponed, so a follow-on programme of activity after the conference is being explored which will focus on developing networks between early researchers. career Priorities Above: Social media card for the scientific discussion meeting, Future exploration of the ice giants. Implement Commonwealth Implement Commonwealth programmes leading international Convene meetings advance science to The Society runs a series of scientificinternationally renowned meetings that bring together leading experts discuss to the latest research and develop to knowledge of their field. not were able We to this year programme our complete owing the to pandemic, but held we of the26 proposed 31 meetings, with five being postponed until 2021/22. 3

In May 2019, the Foreign Secretary, Richard Catlow, led a mission to Beijing high-level for meetings with organisations,national science ministries and the private sector, as part of the Society’s strategic engagement with China. The trip set the scene a year for of concerted China, including a to work related discussion forum at Carlton House with Minister Wang Science Terrace Zhigang, exchanges on a range of topicswith regional science academies, the and translation into selectedChinese of policy science reports. Priorities 68 countries around the world where supported we grant our through researchers schemes

£13.4m of grants awarded to and international foster cooperation global Partner with leading scientific nations on technologies new continued have We work to closely with the US National Academy of Sciences (NAS) including this year, joint work with the International Commission on the Clinical Use of Human Germline Genome Editing, which will launch its final report in also We collaborated 2020. late to update a joint NAS and Royal Society report on the evidence for and causes of climate change, and held a successful joint US/UK Scientific Forum on sustainable agriculture. The Society also co- signed a statement led by the NAS on the importance international of cooperation in responsethe to COVID-19 pandemic. Above: The Society’s Foreign Secretary, Richard Catlow, during the visit to Beijing.

2 2

THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS

international grantsinternational awarded 390 Priorities The Society also oversaw a public call evidence for inform to its work and set up an expert review panel final report, the commission’s for which includes its findings and recommendations. The commission, which also also which commission, The includes participation science from countries around academies from the world, held public meetings throughout with along 2019 webinars inform academics to leading by this in area. research The commission aims to develop a a develop to aims commission The scientists,framework for clinicians regulatoryand authorities to when assessing potential consider clinical applications human of editing. genome germline The framework will identify scientific, medical ethical and requirements and considered, be that should could inform the development of a potential pathway from research if clinical public use – opinion to that heritableconcludes human editinggenome applications are acceptable. with two US national academies, with principles, developing the of aim criteria and standards the for clinical heritable of genomeuse human editing. The Society convened an along commission, international Address global challenges Strategy in action continued Priorities STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION 27 FLAIR Fellows at the start Above: two-year their of Fellowships. SCIENCE SHAPING THE WORLD WE LIVE IN

Dr Sarah Fawcett University of Cape Town, Africa South The role of marine ecosystems in quality water rapidlyimproving in regions. coastal urbanising Coastal regions that home are large to subject populationshuman are to as pollution,such significant pressures habitat destruction, depletion resource This project change. aims climate and identifyto of track and the sources pollution rapidly coastal urbanising to the complex on focusing regions, relationships between biogeochemical fluxes and primary production in systems.marine

Dr Oluwaseyi Shorinola International Livestock Research Institute, Kenya of mobilisation and mining Rapid improve to alleles gene beneficial wheat production in East Africa. Dr Shorinola is a crop geneticist. In less than 40 years Africa will an have additional 1.3 feed, people to billion of whom half will be living in urban wheat will for demands where areas focuses This research only increase. on using genetics improve to the yield and quality of wheat production in Africa. East

Dr Tshimanga Raphael Université Kinshasa, de Democratic Republic of the Congo of framework a Developing catchments classificationfor hydrological predictions and water an management in resources ungauged basin of the Congo River. The catchments of the Congo of greatare importance, providing fisheries supply, water hydro-power, is aand more. Dr Tshimanga hydrologist a developing is who classificationcatchment system healthy enable sustainable and to the Congo for planning resource Basin. Enhancing Enhancing research Fostering collaboration and S D generation of research leaders generation research of areas that addresses research significance global of environments capacity through strengthening impact between African fellows UKand researchers upporting in excellence eveloping Africa’s next Aims of the programme: the Aims of • • • • Thanks the to FLAIR scheme, some scientists returning are African to countries from the UK and USA to continue their careers in African institutions. important an is This part of the programme – attracting scientists countries from back where they completed have their postdoctoral training so that they can play a part in building the research infrastructure the continent. across improving keep their scientificTo output, African countries need to grow and retain scientific talent and FLAIR is one of a number of initiatives support to African early establish to their researchers career Africa. in careers FLAIR continues the Royal Society’s support of science in Africa. Our synonymous are programmes with grants our and science in excellence programmes play an important future developing scientific in role leaders.

THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS

26 The 2019 FLAIR-funded scientists selectedwere from a competitive pool of more than 700 applicants. Their research is diverse, ranging energy renewable providing from solutions addressing climate and change tackling to food security and targeting health environmental and problems that most are acute for people living in African countries. Fellowships available were to support up 30 to talented early undertake to researchers career cutting-edgescientific that research the challenges will global address facing developing countries. It will supportalso them establishing in independent careers African in institutions and, ultimately, their own African groups. scientistsresearch the continent across drawn from gathered in Naivasha, Kenya, in April 2019 celebrate to the start the of two-year fellowships. The Royal Society has partnered with the African Academy of Sciences (AAS) launch to the Future Independent African – Leaders Research (FLAIR) Fellowships. The fellowships are for talented African early career researchers who have the potential become to leaders in field.their (FLAIR) Fellowships Independent Research Independent Research Future Leaders – African – African Leaders Future Strategy in action continued STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION 29 VNS Neural lace Neural Optogenetics Vestibular implants Vestibular Vagus nerveVagus stimulation 2 DBS

Stentrodes Neuraldust Retinal implants Retinal Deepbrainstimulation Neuropixels

Corticalimplant Cochlearimplants 3 ECoG report, which showed how 1 electrocorticography Recording technologies Stimulating technologies INVASIVE TECHNOLOGIES INVASIVE

fNIRS This year, we launched we This the year, iHuman: blurring between lines and mind machine transform could technologies new fundamentally and medicine change how interact we with technology Neural interfaces other. each and electronicare devices placed on the outside or inside of the brain or nervous system record or to stimulate activity interact and with the nervous system. report The took future-facinga possible look into applications of neural and brain- interfaces,computer the important ethical questions the technologies raise and maximise how to the benefitsand minimise the risks of the technologies. Priorities spectroscopy Functionalnear-infrared

fMRI tDCS EEG with FES SCIENCE SHAPING THE WORLD WE LIVE IN Transcranial direct Transcranial current stimulation current resonance imaging resonance Functionalmagnetic

FES TMS MEG stimulation Transcranial Functionalelectrical magnetic stimulation Magnetoencephalography

EEG MMG TENS stimulation electricalnerve Transcutaneous Mechanomyography Electroencephalography Recording technologies Stimulating technologies Recording and stimulating technologies NON-INVASIVETECHNOLOGIES PERSPECTIVE Blurring lines between between lines Blurring mind and machine iHuman , looked at the current demand storing and carrying hydrogen, which is difficult store to on its own. Our report illustrated data on science this in jobs for demand the increased area and set out ways help to build strongera all talent help pipeline to sectors benefit data from science. The report, Dynamics data of science skills datafor professionals and how this industrialvaries across sectorsand UK regions. It identified areas for action strengthen to the UK’s data companion Two base. talent science booklets also were published with case studies highlighting paths career academia, industry,across charity government;and models and and mechanisms presenting innovative be could which approaches and demand meet to implemented talent.share

Dynamics of data data of Dynamics science skills benefit sectors all can How talent? science data from

Increase scientific advice for policy makers Scientific howthinking influences people theirlive Society engages The now. than so more never lives, with the public different insettings many to hear their part the of science make to and views and experiences wider conversation. The Society continues influence to policy makers and three of our reports from the past year illustrate our work in this area. Our report on green ammonia the opportunitiesconsidered and challenges associated with the manufacture and future use of zero- Ammonia ammonia. green carbon or is a gas that is widely used make to agricultural fertilisers, green and but made gas the same is ammonia in a way that is 100% renewable carbon-free.and report The looked at how the production of green offer could furtherammonia options in the transition carbon net-zero to emissions, energy including dioxide storage renewable for as a energy, zero-carbon fuel and as a means of Inspire through historicInspire collections. Increase scientific advicefor policy makers. Implement a public programme of and engagement.dialogue Integrate public into science debate and culture. education. STEM of the value Promote 1 3 4 2 5 Priorities: continued

THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS Participants Exhibition Science 2019. Summer the Lates, at

Above: to everyone of science science of the importance Demonstrating Strategy in action STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION 31

Engage with the public on the including issues, major nature of science and the pandemic, change, climate biodiversity and UK land use. Launch a new programme of partnership grants that supports schools working with STEMa partner consider to change climate issues around biodiversity. and Launch a new programme Convene scientificConvene experts urgently support to the UK the to response government’s engage and pandemic global with other and government new stakeholders provide to scientific advice as it emerges. authoritative,Provide independent and accessible scientific policy to evidence and climate on makers biodiversity, future land use in the UK, data and AI, genetic other and technologies science. of areas emerging Continue advocate to the for importance increased of and investment research in itsinnovation and economic benefits. societal and the restrictions to Respond caused by the pandemic by re-imagining the Society’s programme engagement public so that it can be delivered using digital channels. boostto young people’s mathematics skills for careers.future

• • • Looking forward Looking The Society will: • • • • 2020/21

SCIENCE SHAPING THE WORLD WE LIVE IN

4 is an eye-catching an is large

5 2

format tour our of solar system and writtenbeyond, astrophysicist by Raman Prinjsa and illustrated by artist cast children their The Chris Wormel. theirvotes for favourite science book from a shortlist of six titles, chosen by a panel of adult judges, chaired by Royal Society Fellow Professor Sheila the former including and Rowan author and poet laureate, children’s Michael Rosen. Priorities Planetarium Planetarium Inspire through historic collections In October 2019, specimens prepared and viewed by the early Dutch naturalist Leeuwenhoek van Antoni reunitedwere by the Society with one of his original microscopes at the Rijksmuseum Boerhaave in Leiden, the Dutch national museum of the history of science and medicine, a state-of- for the-art photoshoot. specimens, The sections cork cottonincluding and seeds, may be the earliest surviving objects seen by microscope, and allowed science historians to recapture the ‘look’ of 17th century in the moment recording science, digital films with and high-resolution colour photographs the for first time and giving us a rare insight into what images of that time might looked have like. Morethan 3,000 people able were to visit Carlton our House Terrace building find to out more about its history during Open House weekend, free festivalLondon’s of architecture an the was and This urban landscape. increase on last of 45% year’s number of attendees. Priorities

, which, Planetarium: Planetarium:

3 Writer, broadcaster and feminist and broadcaster Writer, campaigner Criado Caroline Perez winner became the 32nd (above) of the prestigious Royal Society Science Books her for book, Prize Exposing Bias Data Women: Invisible Designedin a World for Men brings together a range of case studies, stories and new research from the the that world exposes around lack of gender-specific data that has world a biasedunintentionally created against women. Priorities In the 2019 funding round, schools 49 from across the UK received Partnership Grants. further A six schools that support students with Special Educational Needs and Disabilitiesfunded. (SEND) were Over 8,400 students from primary and secondary these involved in are level projects.55 The application process is in two stages. Bythe end of February 107 schools had2020, been invited to stage application 2 of the 2020 round, althoughfinal likely are submissions to be to reduced because of pandemic- school closures. related Books prizes record-breakingA 10,600 children from schools 471 and youth groups the UK across chose the to Museum asWelcome the winning book the for 2019 Royal Society’s Book People’s Prize. Young

series 5

and regional press. regional and 2

You and the planet You the skills and interest to further to the interest skills and their studies in this area. showcased leading environmental leading showcased and the issues discussing thinkers their possible solutions at events the country.around Four high-profile events public took London Newcastle, in Swansea, place the Cornwall and was series and accompanied by a media and digital campaign. Over 700 people attended the events, with more than 110,000 watching the talks Media online so far. coverage included articles in the Evening Standard Priorities the value STEM of Promote education PartnershipThe Grants scheme offers up £3,000 to UK to schools or colleges buy to equipment to run a STEM investigation project in partnership with a STEM professional industry. or either Thesein research will enable students insight gain to into STEM subjects and give them Dame OttolineDame Professor and Leyser Richard Fortey. The series received more than 725,000 views on YouTube. Our

event, held in Wales. Hosted by Rachael Garside, Julia Brown DBE Brown Julia Garside, Rachael Hosted by Wales. in held event, 18.9% 18.9% 24.2% You and the planet the and You

People Science of videos delve Above: UK’s top research teams. This was an increase of 13% onlast year’s attendees. On social media 287,000 have we whichfollowers is a 24.2% on Twitter, increase on 2018/19. On Facebook, fans, 245,000 have we up 18.9% on has channel Our YouTube last year. 52,000 subscribers, up 21% on last Our websiteyear. had 1.8 million users millionand 2.7 sessions, up and 9.6% 3.8% respectively. on last year, Our into the Society’s rich archive of artefactsscience the stories tell to of extraordinary scientists and how their still work is influencing our understanding of the world today. two,In this series year, launched Professor Brian discovered Cox the scientificinspirations of the Venki Society, the Royal of President Society Royal and Ramakrishnan, Fellows Dame Wendy Hall, Professor Martin Haigh,Joanna Professor Rees, FREng FRS, Juliet Davenport OBE, James DurrantFRS and Rebecca Heaton.

Facebook fans Facebook Twitter followersTwitter 245,000 287,000 2 perspective report on the THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS members of the public

attending a packed programme of programme attending packed a thought-provoking talks, demonstrations entertaining and performances exhibits 22 alongside of hands-on technology, and science showcasing the work of some of the Our free, week-long Summer Science Summer week-long Our free, Exhibition, the which celebrates cutting edge of UK science, took place in July 2019. This year saw we over 11,500 30 Integrate science into public into science Integrate and culture debate Implement a programme public of dialogue and engagement Strategy in action continued Priorities Because of the pandemic, the conduct to made been has decision this as an online activity. In the autumn Society 2020, will be running a public dialogue which has two objectives: obtain to insights into people’s attitudes towards and priorities landscapes, the for factors these underpinwhich these how and views informed are by scientific how investigate to and evidence; much people know about how land use decisions made, are and how they would these like decisions be to made in the future. The neural interfaces neural The dialogue report planned in as launched was September 2019 with the Society’s iHuman neural implicationsapplications of and brain interfaceand technologies. STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION 33 Professor Daniela Schmidt Schmidt studies Daniela Professor the impacts warming global of acidification ocean marineand on ecosystems. Human-driven to carbon dioxide of emissions the affect atmosphere oceansthe acidificationthrough warming and or deoxygenation. Ecosystem shifts significantsustainability cancreate challenges, management and particularly countries among with a strong the on She sea. dependence is a Wolfson Research Merit Award holder at the University of Bristol and was previously a Royal Society University Fellow. Research SCIENCE SHAPING THE WORLD WE LIVE IN Professor Clare Grey Developing new battery technologies is crucial the to ever-growing use renewable of theenergy and decarbonisation of transport. Professor Clare Grey is working develop to these technologies by looking at materials batteries make to that can charge and discharge faster and that could store much more power than the batteries is She currently available. a Royal Society Research Professor at the University of Cambridge and a Fellow of the Royal Society. Professor Polly Arnold ProfessorPolly Arnold is a synthetic molecular chemist using who is carbon dioxide – one of our biggest environmental of terms in problems damage build – to renewable work describes her She materials. as ‘making weird molecules that the textbooks say should not exist’. She is a Fellow of the Royal Society, is basedat the University of California, based previously was and Berkeley at the University of Edinburgh, where her laboratory had been funded by a Royal Society Wolfson Laboratory grant.Refurbishment

is an exhibition which In November 2019, the Society briefingspublished climate based on the Intergovernmental the of work Panel on Climate Change (IPCC). These looked at the links between land and climate change and the on impact warming temperatures of cryosphere. and the The ocean briefings identify steps that UK domesticallypolicy can take, makers and internationally, address to risks and opportunities. The Society also reportspublished microplastics, on soil structure and green ammonia. In June 2019, the UK government greenhouse committed net-zero to gas emissions The by 2050. Society’s influence can be seen in the report produced the by Committee on Climate Change that led that to decision, which heavily the removal cited Greenhouse gas report that was published jointly by the Royal Society and the Royal Academy of Engineering in2018. weatherStormy – from lore to science opened at the Royal Society in February It showcases 2020. instruments, books manuscripts and from the National Meteorological Library Archive and collections alongside items from the Royal Society that tell the of evolution science weather climate and of in the UK.

is becoming harder,

THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS

32 The Royal Society is at the forefront of this work. fund We researchers working cultivating on climate resilient crops increase to food security,engineering infrastructure that is designed withstand to the growing risk of natural disasters, and integrating low-tech renewable energy solutions within communities. In 2019, launched we a series five of events across the UK connect to experts with the public explore to some and of the issues. key You as such issues the at planet looked how tackle we climate change, how energy use affects the planet, how our diets can a difference make and how can we nurture nature. Regrettably, a further event, a family festival the at Natural History Museum, had be to cancelled because the of pandemic. As global temperatures increase, increase, As temperatures global impactsthe change climate of environment the people and on are becoming more severe and adaptation costlier and, in some cases, impossible. Science is central to is that damage the understanding being done and helping to us to find ways reduce to harm and adapt lifestyles.our biodiversity Climate andClimate Strategy in action continued STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION

of Nottingham of Life Sciences, University Sphicas Paraskevas Professor FRS Senior Scientist, CERN and Professor of Physics, National and Kapodistrian University of Athens FRS W Szostak Jack Professor Chemistry of Professor Chemical and HarvardBiology, University and Massachusetts General Hospital OBE FRS Dr Andrew Taylor Executive Director, STFC National Laboratories Professor, InstituteProfessor, of Science and AustriaTechnology Gregory FRS Professor Scholes Professor of Chemistry,William S Tod Department Chemistry, of Princeton University BarbaraProfessor Sherwood FRS CC Lollar MollyProfessor Shoichet OC FRS DepartmentUniversity of Professor, Chemical Applied Engineering and Chemistry, Institute of Biomaterials and Biomedical Engineering, Department of Chemistry, University of Toronto Sockett FRS Liz Professor Professor of Bacterial Genetics and School Investigator, Trust Wellcome Professor Leonid Sazanov FRS Leonid Sazanov Professor Director, Stable Isotope Laboratory, Laboratory, Isotope Stable Director, Department Earth of Sciences, University of Toronto

SCIENCE SHAPING THE WORLD WE LIVE IN

Assistant Director and Research Francis The Leader, Group Senior Crick Institute Professor JohnProfessor Rodenburg FRS Department of Chair, Personal Electronic Electrical and Engineering, University of Sheffield Professor Matthew Rushworth FRS Watts Professor of Experimental DepartmentPsychology, of Experimental Psychology and Integrative for Centre Trust Wellcome Neuroimaging (WIN), University of Oxford Professor David NichollsProfessor FRS ProfessorEmeritus of Mitochondrial Physiology, the Buck Institute for Research on Aging, USA ChristineProfessor Orengo FRS Structural of Professor Bioinformatics, Division University Biosciences, of London College AnneProfessor Osbourn FRS Department of Leader, Group John Innes Centre Metabolic Biology, AnantProfessor Parekh FRS Department Physiology, of Professor of Physiology, Anatomy and Genetics, University of Oxford FRS JulianProfessor Peto Professor of Epidemiology, Faculty of Epidemiology Health, Population and London School of Hygiene & Tropical Medicine CaetanoProfessor e Sousa Reis FRS FMedSci

Professor Marta Kwiatkowska FRS MartaProfessor Kwiatkowska Professor of Computing Systems, Department Computer Science, of University of Oxford and Fellow, Trinity OxfordCollege, Dr FRS Mark Mayer Scientist Emeritus, National Institute Stroke, and Disorders Neurological of National Institutes of Health, USA GarethProfessor H McKinley FRS School of Engineering Professor of Innovation, Department Teaching Mechanicalof Engineering, Massachusetts Institute of Technology Professor GagandeepProfessor FRS Kang Executive Translational Director, Health Technology and Science Institute, India FRS Kay Steve Professor Provost Professor of Neurology and Bioscience, Convergent Director of University of Southern California John-Michael Kendall Professor FRS BGS Professor of Geophysics, School of Earth Sciences, University of Bristol FRS Kerr Roy Professor Canterbury Distinguished Professor, Mathematics Department, University of Canterbury, Christchurch, New Zealand JonathanProfessor Knight FRS Professor of Physics, Department of Physics, University of Bath and Pro- Vice-Chancellor University (Research), of Bath

Professor Richard Jozsa FRS Jozsa Richard Professor Quantum of Professor Trapnell Leigh Physics, Department of Applied Mathematics Theoretical Physics, and MathematicalCentre for Sciences, University of Cambridge Professor Peter Haynes FRS Peter Professor Professor of Applied Mathematics, Department Applied of Mathematics Theoretical Physics,and University of Cambridge Martin Head-GordonProfessor FRS Distinguished Pitzer S Kenneth Chemistry, of DepartmentProfessor of Chemistry, University of California, Faculty Senior and Scientist,Berkeley Division,Chemical Sciences Lawrence Laboratory National Berkeley MatthewProfessor Hurles FRS Senior Group Leader and Head of Human Genetics, Sanger Wellcome Institute Professor ChristopherProfessor Hacon FRS McMinn Endowed Presidential Distinguished and Professor, Chair Department Mathematics, of University of Utah MarkProfessor Handley FRS Professor of Networked Systems, Department Computer Science, of University London College Harland Richard Professor FRS CH Li Distinguished Professor of Genetics and SeniorAssociate Dean Biological Genomicsof Sciences, Development,and Department of Molecular and Cell Biology, University of California, Berkeley

Professor JonathanProfessor FRS Flint Wilder Professor BillyAudrey and of Psychiatry andNeuroscience, Department of Psychiatry and theBiobehavioral at David Sciences Geffen School of Medicine, University of California, Angeles Los Gouverneur Véronique Professor FRS Chemistry, of ChemistryProfessor Research Laboratory, University of Oxford Professor MartinProfessor Embley FRS Professor of Molecular Evolutionary Biology, Institute Cell for and Molecular Biosciences, University of Newcastle upon Tyne Dr Bernard Fanaroff FRS Special Advisor the to Managing Director, South African Radio Astronomy Observatory Square and Kilometre Array South Africa Professor Sarah C Darby FRS SarahProfessor C Darby Professor of Medical Statistics, Nuffield Department Health, Population of University of Oxford Smith George Davey Professor FRS FMedSci Epidemiology, Clinical of Professor HealthPopulation Bristol Sciences, Medical School, Universityof Bristol Professor Peter Butler Peter Professor FRS Professorof Physics, Department of Physics, University of Liverpool LucyProfessor Carpenter FRS Atmospheric of Chemistry,Professor Department Chemistry, of University of York

THE SOCIETY ROYAL TRUSTEES’ REPORTAND FINANCIAL STATEMENTS

Affiliations at the time of election in April 2019 34 Senior Group Leader, Developmental Leader, Group Senior Dynamics Crick Francis Laboratory, Institute Dr James Briscoe FRS Professor and Banbury and Professor in Chair Medical Research, University of Toronto Professor BenjaminProfessor Blencowe FRS Professor CaucherProfessor FRS Birkar Mathematics, of Professor Department Mathematics Pure of Mathematical and Statistics, University of Cambridge R. Brandon Fradd Professor of Mathematics, Department of Mathematics, University Princeton Professor ManjulProfessor Bhargava FRS Bardrick Professor of Microbial Physiology and Chemistry, Institute of Microbiology and Infection, School of UniversityBiosciences, Birmingham of Professor GurdyalProfessor Besra FMedSci FRS Professor of Immunology, Faculty of London College Imperial Medicine, Professor Charles BanghamProfessor FRS FMedSci Director, Centre the for AIDS Programme of Research in South Africa (CAPRISA), CAPRISA Professor of Global Health,Department of University Columbia Epidemiology, Pro-Vice-Chancellorand (Research), University of KwaZulu-Natal Professor SalimProfessor S Abdool Karim FRS Fellows of the Society elected in 2019 Society elected in the of Fellows At the core of the Society are people, from Fellows and staff to generous donors donors generous to staff and Fellows from people, Society the are of core the At and the scientists who supported are through the Society’s funding programmes. People STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION 37

1,065 currently supportedresearchers by the Royal Society through its fellowships research Scientists The Society has played a part in some of the most fundamental, significant life-changing and discoveries in scientific history and the Society’s scientistscontinue outstanding make contributionsto scienceto in many research areas. The Society is currently supporting 1,065 (2019: 1,176) its through researchers research fellowships. These researchers long-term from funding receive the Society and range from early just starting researchers career their some independent careers to of the most distinguished senior the in country. researchers SCIENCE SHAPING THE WORLD WE LIVE IN

Fellows Fellows elected are through a peer-review process on the basis of their contribution science. to It is from the eminence of its Fellowship and Foreign Membership and its government from independence that the Society derives its authority in scientific matters. Fellows and Foreign Members fulfil a range of responsibilities the for Society on a voluntary basis. Many others, scientists non-scientists, and also contribute the to work of the Society on a voluntary basis. The Fellowship is supported by staff based in London. A new fellowship election process during the implemented was year, moving it from a paper-based process an online to system.This facilitatedchange significant a increase in the number of votes received. toolsets. There may be a way such expertise can be usefully made available work to on the COVID-19 modelling. Royal Society Fellows and Foreign Members elected in 2019. Above: Fellows the of Royal Society and people who fund we contributing are theto UK and global effort tackle to COVID-19. They working are inside the UK government as wellas support independent providing for national and international efforts. The work includes: research on the biology the of virus and therapies to as such it; goals term combat longer the development vaccines; of and reviewing evidence inform to policy pandemics such making. Tackling will require both basic and clinical research at every stage, and the scientific community it doing all is can help to fight this terrible disease and reduce its toll. The Society is currently using its convening power support to the efforts model to the pandemic by calling on expertise from those working modelling on other in fields. Areas such as traffic planning, financial modelling, dataflow market communications optimisation across networks individualised and marketing on social media will already be using agent-based modelling, often at very large scale withand well-honed data-science

Professor JamesProfessor Rothman ForMemRS BrianProfessor Staskawicz ForMemRS Honorary Fellow 2019 elected in Hamied FRS Dr Yusuf Chairman, Cipla Further online. available is information Sterling Professor of Cell Biology, School University of Medicine, Yale Professorof Plant and Microbial Biology, University of California, Berkeley

University Distinguished Professor, DepartmentsChemistry of and ColoradoAtmospheric State Science, University Professor David MilsteinProfessor ForMemRS Professor and The Israel Matz Professorial Chair of Organic Chemistry, Department Organic of InstituteChemistry, of Weizmann Science AkkihebbalProfessor ForMemRSRavishankara Professor of Atmospheric of Science, Professor Department Earth of Planetary and Department and Science of Policy andEnvironmental Science, Management, University of California, Berkeley HHMI, Investigator Rebecca and Laboratory C. Professor, Lancefield of Mammalian Cell Biology and UniversityDevelopment, Rockefeller ForMemRS Fung Inez Professor Professor Jack Dongarra Jack Professor ForMemRS University Distinguished Professor, DistinguishedUniversity Tennessee, of Ridge National Oak Laboratory Staff, Fellow, Schooland of Turing Mathematics, University Manchester of Elaine FuchsProfessor ForMemRS Professor Sandra ForMemRSProfessor Díaz Professor of Community and Ecosystems National Ecology, University Senior and Córdoba of National Research Researcher, Council, Argentina

continued THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS

Affiliations at the time of election in April 2019 36 Professor HansProfessor Clevers ForMemRS Molecular in Genetics,Professor University Medical Utrecht Center and Staff Scientist, Hubrecht Institute of the Royal Netherlands Academy of Arts Sciences and Professor BarryProfessor Barish ForMemRS Linde Professor of Physics, Emeritus, California Institute and of Technology Distinguished Professor of Physics, University of California, Riverside Foreign MembersForeign 2019 elected in Professor Kumar Wickramasinghe Kumar Professor FRS NicolaosDistinguished and Professor Curtis Sue and G Alexopoulos Electrical of Chair Presidential ComputerEngineering Science and Department, University of California, Irvine Professor, SchoolProfessor, of Mathematics, Institute Advanced for Study Professor Akshay Venkatesh FRS AkshayProfessor Venkatesh Professorof Neurology and Director, Mitochondrial for Centre Wellcome Research, University of Newcastle upon Tyne Professor Sir Doug Turnbull SirProfessor Doug Turnbull FRS FMedSci Director, Institute of Cancer and Genomic University Sciences, of Birmingham Professor Ian Tomlinson FRS IanProfessor Tomlinson Professor of Biomedical Data Statistics, and Science Departments of Biomedical Data Science and Statistics, University Stanford Professor RobertProfessor Tibshirani FRS People People STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION 39

4.6% and the than men than men 36% 30%

(2018: 26%) (2018: 30%) (2018: 70% 64% (2018: 74%) (2018: 70%) Gender pay gap reporting gap Gender pay The Society has voluntarily completed gender pay gap reporting in order better to understand how compare we with other organisations. At the ‘snapshot’ date of 5 April 2019, the mean gender pay gap was − median gender pay gap was 10.4% compared the to national average of 14.1% and 12.8% respectively, as reported on the Gender Pay Gap website as at 10 July 2020. 6% less Women paid 6% (2018: 3% less) Quartile 4: (2018: 1% more) Women paid 1% more Quartile 2: SCIENCE SHAPING THE WORLD WE LIVE IN 36% 30%) (2018: Men

than men 32% 45% than men

(2018: 24%) (2018: 40%) 68% 55% (2018: 76%) (2018: 60%) role, and the remuneration level the and level remuneration role, thosefor roles in sectors where found. be suitablewould candidates staff all for packages Remuneration proprietary using benchmarked are pay surveys. The annual inflationary increase provided all to staff and senior management pay agreed are by the Society’s Remuneration Committee. The last review pay of structures undertaken was during 2018. unremunerated. are All Trustees (2018: 4% less) Quartile 3: Women paid less 2% Quartile 1: Women paid more 22% (2018: 12% more) 64% Women (2018: 70%)

less more less more specifically any issuesthey have witnessed or would report. to like Remuneration policy gender pay gap percentages referenced in quartiles are based on mean calculations. The reported quartiles represent an equal number of number reported calculations. equal The quartiles mean an quartiles on based in represent are referenced Note: percentages gap pay gender Quartile paid. lowest the quartile upper the employees. highest is quartile, the paid to highest 1 the paid each representing from in employees The aim of the Society’s remuneration policy maintain to is sustainable, fair levels of pay at the same time as attracting and retaining the right people to charitable our deliver objectives. In setting appropriate levels of senior management the Society pay, considers the skills, and experience competencies required each for than men (2018: 14.34%) UK average 14.1% UK median 12.8% than men (2018: 11.8%) Mean earnwomen 4.6% than men (2018: 0.2%) Gender reporting gap On 5 April 2019, employed we 212 full-pay relevant employees (2018:174): Median earnmen 10.4% than women (2018: 11.4%) W R M I participation STEM. in maximiseand the effectiveness of diversity initiatives across the scientific community. achievements of a wide range of scientists underrepresented from and inspirational providing groups, models. role relatable Society and that encourages diversitypromotes inclusion. and inclusion a priority, andthe Society has developed a Diversity Strategy that sets 2019for – 2022, out how the Royal Society will use its convening power and leadership, in partnership with others, increase to diversity in STEM and build a more inclusive scientific The community. Diversity Committee, standing a Committee under Council, keeps of recommendations makes and review Councilto on the diversity strategy. CommitteeThe the oversees also delivery of a programme of activities by the Society in line with this strategy. The 2019 diversity – 22 strategy has the following objectives: 3. ork in partnership assess to 4. ecognise and champion the 1 aintain within culture a the 2. dentify and address barriers to As the an employer, Society is committed providing to an environment discrimination, from free bullying, victimisation or harassment and creating to a culture of inclusivity individualwhere differences and the contributions of all staff are recognised and valued. The Society provides equality of opportunity for discrimination will tolerate and all not disability, age, of grounds on reassignment,gender marriage civiland partnership, pregnancy or religion parenthood,and race, belief, or sex sexual orientation. The Society regularly surveys staff in staff surveys and in exit interviews on matters of diversity and inclusion,

2020.

31 March staff furloughed were in the year ended Equality, diversityEquality, and inclusion As theUK’s national academy of engineering, technology science, and mathematics, the Society has particulara responsibility ensure to that diversity and inclusion are embedded across all of its activities and part are of the culture the of organisation. The Society’s Diversity Committee regularly monitors statistics on diversity across the Society’s activities an publishes and annual data report. The Society is committed making to diversity and Volunteers engagement public our of number A not events other would and work be possible without the contribution of our volunteers and the Society is grateful all to those who have contributed its to work over the past year. 2020, the THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS Royal Society staff volunteering at the Summer Science 2019. ExhibitionScience Society Summer Lates, the at staffRoyal volunteering Above: 38 In March 2020, theIn Society’s March 2020, buildings closed were Fellows, to staff, clients and conferencing was visitors.other decision The taken in the interests of all our stakeholders. Although the building is closed, the business of the Society has continued with staff working Some possible. wherever remotely areas of the business affected were than othersmore and, through consultation with staff, the Society considered when and if it would be appropriate furlough to staff under the government’s Coronavirus Job Retention Scheme. No members of Society had 212 staff. The Society’s staff organised are into programmes, services trading sections. and The Society aims offer to fair pay attractto and retain appropriately qualified staff lead, to manage, support and deliver the Society’s aims on behalf of its Fellows and Council. As 31 at March Staff STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION

£m 4.2 2019

114.7 110.5

£m 4.4 2020 133.7 129.3 R benefit public onstatement 10. page Society’s the on more ead activities the for year ended 31 March it is expected2020, that results for the year ended 31 will March 2021 be significantlyreduced. legacies and donations from Income legacies and donations from Income remained consistent with the prior year at £0.8 million. Expenditure The Society undertakes a broad range of activities that provide public benefit either directly or indirectly, in line with our strategic priorities. Expenditure charitable activities on The majority of the Society’s charitable grant awards, to relates expenditure million £102.5 for accounting this year expansion The £84.7 million). (2019: of the grant programme included an increase in the value of grants existing under schemes, awarded most significantly in the URF millionprogramme to of £7.4 £45.0 million million), (2019: £37.6 the Dorothy Hodgkin Fellowships of £1.5 million £6.4 million to (2019: £4.9 million), Royal Society Research Professorships of £1.5 million £13.9 to million (2019: million), £12.4 Royal Society Challenge Grants of £1.6 million £2.9to million (2019: £1.3 million) and Wolfson Advanced Fellowships of £1.2 million £1.4 to million (2019: £0.2 million).

SCIENCE SHAPING THE WORLD WE LIVE IN

Total expenditure Total Expenditure charitable activities on Expenditure on raising funds raising Expenditure on the Future Leaders – African Independent Fellowships Research (‘FLAIR’), which launched in May 2018; the year ended was 31 March 2020 the firstyear of FLAIR Fellows. furtherance in charitable of Trading objectives level similar a at remained theto previous year with a small decrease million in income to of £0.1 £11.5 million (2019: £11.6 million) due the majority trading for successful to of the year both for publishing and the 2020, In March conferencing. Society its closed and buildings tradingpaused the conferencing activities. programme The 2020 of cancelled events was meetings and postponedor and, while limited impact in reflected the trading was tradingresults the conferencing of Income activities charitable from Income Most of the year-on-year increase in in the increase to relates income grants charitable activities for which £108.5rose to million (2019: £89.2 million). The Society’s grant core from BEIS remained consistent with the million but there prior year at £47.1 increaseswere in the Society’s grants from BEIS under the Investment in Fund (IRTF)Research Talent from £21.7 million in 2019 £31.6 to million in the BEIS under and Global 2020 (GCRF) Fund Research Challenges from £6.0 million in 2019 £15.0 to the in increase The 2020. in million IRTF was expand to the number of existinggrants under awarded GCRF The programmes. supports The operating result before investment gains/losses was in line with the budget and forecast Although the financial the year. for impact was relatively small, there reduction significant some a was in of the Society’s activities. The areas most affected are those that perform trading public-facing or programmatic activities where meetings and events that had been cancelled were planned or 2020 for postponed. COVID-19 The pandemic caused investment markets fall, to resulting in a net loss in investments and an overall net deficitresult for the year. the governmentOn March 20 2020, further a announced of series protecting aimed at measures businesses and employees during the particular crisis, in the Coronavirus Job Retention Scheme. The Society did not receive any financial benefit result as a of the measures in the year ended 31 March and considered the2020 impact of the in weeks that these measures followed.

Change Change Change 16% Change 17% 22% −15%

£6.9m 2020 2020 2020 2020 £133.7m £129.8m £108.5m

2019 2019 2019 2019 £8.1m £111.7m £89.2m £114.7m Income from investments from Income Total expenditure Total Grants for charitable activities Total income Total

THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS

40 on March 23 2020. In March 2020, due the to InCOVID-19 March 2020, pandemic, the Society closed its buildings Fellows, to staff, clients other and visitors.conferencing Although the buildings closed, the business the of Society continued wherever with staffremotely, working with In line possible. government advice, Hall Chicheley closed Overview In the the 31 year to March 2020, Society’s income increased by 16%, from £111.7 million £129.8 to million. The majority of the Society’s income charitablecame from activities, which increased by 19% during the million £120.1 year (2019: to £100.8 expenditure increased Total million). by 17% on the prior year from £114.7 million £133.7 to million, as the Society has continued expand to its Expenditurecharitable programme. charitableon activities increased from £110.5 million £129.3 to million and has risen around to 97% of total expenditure from around in 95% 2019. Income from investments has decreased from the previous year to million). £8.1 (2019: million £6.9 Financial review STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION 43 For research research For For research research For For For fellowships,For support grants, the the grants, support Committee assesses the applications, then are which the by considered Chair(s). 3a. 3b. 4a. 4b. fellowships, shortlisted candidates are invited to interview and are recommendations made to the Grants Committee. longlisted applications longlisted are sent for peer review shortlisted then are and by the Committee. grants, support make Chair(s) the recommendations consideration on Committees’ the of assessments. Once submitted,Once applications checked are to ensure they meet the thateligibility for criteria programme. 2.

SCIENCE SHAPING THE WORLD WE LIVE IN Applicants submit

1. their proposal.their All recommendationsAll process 5. are then presented to to presented then are Grantsthe Committee approval. for Grant-making Offer letters are sent Offer letters are The grant programmes are are programmes grant The F royalsociety.org/grants/applications Once an award has urther at available is information 6. Grants The primary purposesof the Society’s grant-giving activities support to are the work of outstanding individual scientists at various stages of their careers, primarily in the UK, and encourage to collaborations between UK scientists and scientists throughout the world. Further online. available is information 8. 7. been initiated, we monitor the progress of the award requesting an by holder report progress (or annual in the case of short awards, report) year. final each evaluated on a routine basis (approx. every five years), which helps to inform are programmes whether the us objectives intended their delivering and what steps can be made to them. improve to the candidate and host and candidate the to will offer organisation. The only become an award once host applicant the and both accepted have organisation online. offer the

c fi recognising science science science and public international scienti for policy b Promoting Promoting Providing Education Fostering Supporting and and itsand enefits advice engagement excellence in and global cooperation

and the Society’s flagship annual Exhibition. Science Summer In the work progressedyear, with the implementation of a new customer managementrelationship system centralisewhich and to aims consolidate the Society’s contact improve and processes management stakeholders.engagement with key The project is due be to completed during the year ended 31 March 2021. 2020 2019 2018 climate change and biodiversity, and change climate interfaces neural and science data the end of during Towards the year. thethe Science year, Policy team began support to the response to the COVID-19 pandemic, engaging with Fellows and peers enable to participation initiatives in support to scientific analysis and provide scientific adviceto the government. Expenditure education on and decreased engagement public slightly from £4.8 million in 2019 to The£4.5 decrease million in 2020. in spend is due the to delay of public engagement events planned for the end of the financialyear dueto the pandemic. the Spend in year number a on expenditure includes of events, including the Summer of Science Festival, the launch of a series People of Science of videos 2017 2016 THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS 0 40 20 80 60 140 120 Expenditureon charitable activities, £m 100 42 Aside from grants activity, scientific providing on expenditure advice policy for remained consistent with the prior year at £4.3 million. The Society’s work in this area focused particularly on The funding received under GCRF under received funding The has enabled the Society fund to more URFsinternational establish and a and funding for programme grant new supporting sub-Saharan in research Africa called Future Leaders – African Independent Fellowships Research (‘FLAIR’). FLAIR aims support to who are early researchers career independent an transitioning into is scheme The career. research partnership in operated with the andAfrican Sciences of Academy was launched in May 2018, with the firstawards being made with a commencement date of 1 April 2019. Financial review continued review Financial STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION 45 £m 2019 83.7 20.9 (13.4) (49.4) £m 2020 16.8 80.4 (14.1) (49.5) activities. Modern Slavery Act The Society is committed to taking the appropriate measures reduceto the risk of slavery and human trafficking taking place in supply our organisation or our chains. Pursuant Section to 54 of the Modern Slavery Act 2015, the Society has published its slavery and traffickinghuman for the statement financialyear ended 31 2020. March Further information is available online. Going concern decided Council During the year, progressto a sale Chicheley of Hall and, as a result of the pandemic, the trading activities Royal of Society Limited ceased. have Trading As the trading, the ceased has company financial statementsRoyalof Society Limited the for Trading year ended been have 31 prepared March 2020 on a basis other than that of the basis. concern going are that there consider Trustees The uncertainties material no about the Society and Royal Society (London) continue to Ltd as a going concern. This conclusion has been reached after careful consideration of future forecasts which into take account the ongoing impact COVID-19. of SCIENCE SHAPING THE WORLD WE LIVE IN

to develop longer-term strategies to strategies to longer-term develop to increase its charitable activities in a sustainable which will way, reduce the level of reserves while ensuring that it has adequate resources to enable it respond to emerging to opportunities.risksand Free reserves Free Unrestricted funds assetsUnrestricted fixed tangible Heritage assets Statement of policy of Statement on fundraising Section of the 162a Charities Act 2011 requires the Society make to fundraising statement regarding a activities because it is subject an externalto audit. do not We use professional fundraisers or participators’ indeed or ‘commercial any third parties solicit to donations. therefore are not subjectWe to regulatory relevant any or scheme codes of practice, nor we have received any complaints in relation fundraisingto activities nor do we it necessaryconsider design to specific proceduresto monitor such Enterprise fund (Amadeus RSEF LP) The Royal Society Enterprise Fund was created with the aim of becoming a financially successfulcontributor to early stage companies based science in the UK and a role model the for for science translation excellent of commercial and social benefit. Due theto dual benefitsexpected to be received, the fund is accounted for as a mixed motive investment in the financial statements. SocietyThe Partnership Limited a into entered Agreement with Amadeus Capital Partners in 2014 the create to Amadeus RSEF LP.

products. The Society ensures that against performance managed is benchmarks. appropriate Income from investments the for year was £6.9 million (2019: £8.1 million). The value the of Society’s investment portfolio decreased in the year, from £261.3 million in 2019 to £234.1 The decrease million in 2020. was due a fall to in investment markets at the end of the financial year due the to COVID-19 pandemic. market end year Subsequent to in and, improved conditions have the quarter 30 ending June 2020, the value of investments increased by 12%. Reserves The total funds of the Society decreased by £26.9 million to during the financial million £277.2 mainly dueyear, the to loss on investments. reserves Free are unrestricted reserves (after the pension deficit) less heritage assets and fixed assets. The Society holds free reserves so that it can charitable unforeseen to respond opportunities to continue and existinghonour commitments in the event of a shortfall of income. The Society’s policy is review to its streams expenditure and income basis, commitments annual an on and assess the main financial risks faced by the Society and their to order in associated likelihood reserves level. risk-based a develop The target level was set cognisant of the risks associated with the thechanges in publishing landscape and volatility in investment markets which may affectreturns. At the balance sheet the date, value of the Society’s free reserves was £16.8 million), £20.9 (2019: million well above the target level of £14.8 million. The Society continues cash liability. The decrease in deficit was mainly driven by changes to actuarial assumptions resulting conditions market in changes from and the payment deficit of funding contributions in the year of million.£0.7 In accordance with FRS the 102, actuarial gains on the scheme £0.8 of million (2019: million£0.7 loss) been have taken to unrestricted funds. A triennial valuation of the scheme at 1 January 2019 was agreed during Thisthe showed an increase year. in the deficit from £3.7 millionto £8.7 million and it has been agreed with the that Trustees the Society will pay deficit payments of £1.3 million per recovery seven-year a under annum plan.Current budgets and forecasts indicate that the Society will be able meetto these contributions as they arise. Investment policy and performance On March 23 2016, Council passed a resolution under Section 104A(2) of the Charities Act 2011 adopt to the use of total return in relation itsto permanent endowments with the exception of the Theo Murphy Australia Fund in order to best enable it be to even handed between current and future beneficiaries. The Society does not invest in conflict which withorganisations the charity’s where or purpose, Council deem that do to so would hamper the charity’s work, for example by alienating those who support the Society financially. Council resolved that the Society companies invest in not should or funds that derive a significant portion of their income from the sale or manufacture tobacco of Pension and Life Assurance andPension Life Plan Society theof Royal The Society operates a defined benefit pension scheme which was closed new members to in 2014. The valuation of the scheme at showed31 a deficit March 2020 of £10.7 million (2019: £11.6 million). This betweenrepresents the difference the assets and the obligations of the fundrather than an immediate Royal SocietyRoyal Ltd (London) Royal Society (London) was Ltd set up in 2013 process to corporate sponsorships at the Society. The trading during commenced company had and year the financial previous millionincome (2019: of £0.1 £0.1 million). intercompany debtor between debtor the intercompany Society, as the Parent Charity, and Royal Society Limited of £0.8 Trading result a as arose debt The million. trading losses the accumulated of of the company over several years. After losses and of years several Hall, Chicheley the sell it decision to to possible deemed longer no was paymentrecover and the debt was formally waived in both the parent and subsidiary accounts. trading, ceased has As the company the financial Royalstatements of Society Limited the for Trading year ended been have 31 March 2020 prepared on a basis other than that basis This basis. concern the going of applicable, writingincludes, where the company’s assets down net to also have Provisions value. realisable been made in respect of contracts which become have onerous at the has Noreporting provision date. been made the for future costs of theterminating business unless such costs committed were at the reporting date.

THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS capacity-building grants; education-related grants. for innovation; and innovation; for grants,research collaboration; travel grants; senior fellowships, supportsenior and early fellowships, career professorships;

Grant applications assessed are by means of a peer-review process and consideration by a panel of experts comprising Fellows of the Royal Society and other senior scientists. Each panel is chaired by a Fellow of the Society. (2) Research grants Research (2) 44 The trading subsidiary recorded a trading subsidiaryThe recorded loss of £0.2 million in the year (2019: million). This£0.1 was attributed a to difficult environment with trading a than occupancy anticipated lower rate, partly due the to closure of Chicheley Hall in March 2020. The Society concluded a review operationsof Hall Chicheley at with advice taken from relevant decided Council that itprofessionals. would be in the interests of the charity disposeto of the property as it was become financially self- to unlikely supporting in the near future. As such, with progress decidedCouncil to the property. of sale a Subsequent theto year end, the company managing the property gave notice the contracton management and the Society has no plans reopen to Chicheley Hall and will progress with a sale of the property. At the time the with progress to made was decision a sale of the property, there was an Chicheley Hall – Royal Society HallChicheley – Royal Limited Trading • • • • • • Financial review continued review Financial Grants made by the Society fall into two broad classes as follows: (1) Fellowships STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION

47 Status of risk SCIENCE SHAPING THE WORLD WE LIVE IN Effective project initiation and project management processes. Specifically engagement pandemic, withduring the Fellows and peers to enable participation in initiatives to support scientific analysis and provide scientific advice to the government. Implement the decision of Council to progress with a sale of Hall.Chicheley Continue to take advice from relevant professionals and follow steps. recommended Continue to work with many partners, in the UK, the rest of globally. and Europe arrangements international future for promote and Advocate collaboration, and the ability of the UK to continue to attract UKoutstanding science for funding scientists overseas, from regulatory matters.and relationships. build and advice Provide Engage senior-level management, in committees Council and senior-level Engage policy setting monitoring. and Regular review and update of information security policies and procedures. continuity business of disaster and update and review Regular recovery plans to help minimise disruption to operations from unexpected events. The Society has a system of committees that report to Council and are responsible areas for key of the Society’s work. Early planning for the formulation strategy of the – 2027 2022 considerations. risk and financial on focus with increased communication regular the Officers meetings and of Regular from the Officers to Council. Specificallypandemic, the current Officersduring the actively the impact advice the and on government the latest consider Society’s work programme with reprioritisation and diversion of need. the biggest current of the areas to resources New programmes of work are approved by Council, who have oversight over all work at the Society and set the Society’s strategy. communication regular the Officers meetings and of Regular from the Officers to Council. Oversight of the Society’s activities by Fellows with relevant experience. Early planning for the formulation strategy of the – 2027 2022 demonstrating of public ways of considerations include to effectively. benefit

Management • • • • • • • • • • • • • • • • • •

Key strategic Key risk at priorities Trading subsidiary,Trading Royal Society Limited,Trading fails to contribute funds to support research and/or carry out activities further to the Society’s objectives. Political developments major in partners, science international or between UK and major international partners,science negative impacts have system. could the UK This science on lead to funding cuts to foreign partners or their withdrawal from international collaborationagreements and foreign in arrangements drop a and applications for Royal Society grant awards. Risk Eventsadversely impact reputation and operations (cyber attack, data serious security breach, a serious fraud, major safety incidentshealth internal and or failures). process The Society’s strategy does not clearly articulate objectives to allow effective prioritisation of work, which means the Society commits to work beyond its capacity; the Societyresource therefore, does not deliver against its mission and does not act effectively in its threekey roles as a charity, fellowship and national science. of academy the Society ensure The not does effectiveness of its work, failsremain to important address and/or relevant not does and arise, they as issues its that benefit is public ensure stakeholders. by recognised

Promoting excellence excellence Promoting science in S collaboration D everyone to science upporting scientific international emonstrating importance the of H M Decreased riskDecreased Increased riskIncreased change No risk igh risk edium

Key strategicKey priorities at risk Key Status of risk thein presented Only significant are risks table, therefore none have been rated as risk low status of Change Council and senior staffreflect senior and Council frequently uncertainties on and risks achieving to the Society’s goals and the effectiveness of the various means it employs to mitigate those risks. are They vigilant identifyingalso in new risks and taking steps address to them. Actions and processes often contribute mitigation to several of risks simultaneously. The Society and develop works assiduously to that ensure maintain relationships to its activities remain relevant, that its contributions effective are and that the value of its work is recognised. The Society enjoys many beneficial relationships through its Fellows, MembersForeign staff. and The risk register was reviewed the developments in considering external particular in landscape, the COVID-19pandemic. This review identified key that risksall had already been included on the risk registerbut the likelihood and impact leading therefore increased, had additionalto management of the risk being required. The main risks identified actions and Council by them, manage including to taken ongoing actions, described are in the table.

THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS

46 The Audit CommitteeThe considers reportsregular risk-management on systems and management of major risks. considers regular Council reports from the Audit Committee and reviews management of major risks, including using its own risk The register. risk registers of the Society’s sections also are updated periodically and used in risks monitoring and managing communicatingand information about the risks organisation. across Following previous internal audit reviews, a new processpreparing for was registers risk considering and launched in the year andaims to thereinforce importance of risk at making decision in considerations all levels of the organisation. Council is responsible for ensuring ensuring for responsible is Council arrangementsthat proper are in place risk for management. principally the on relies Council Audit Committee, supported by the internal auditors, to KPMG LLP, assess those arrangements to and advise it accordingly.

anduncertainties Principal risks STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION

49 Status of risk SCIENCE SHAPING THE WORLD WE LIVE IN Review of investment-management of arrangements.Review the investment portfolio review Regularly performance and of the investment manager. triennial valuation. a Completed Appropriate legal advice sought and followed. andTrained competent staff in senior positions, and professional appointed. Trustees pension encourage positively Activeand to influence agenda groups. underrepresented from engagement Unconscious bias training provided to those in positions to make decisions. with experts engagement and consideration Continual in fields.relevant Regular communication with the Fellowship and other key stakeholders. system management to relationship customer new Implement a and communications effectively monitor and more track contributions. Specifically engagement pandemic, withduring the and Fellows peers to enable participation in initiatives to support scientific government. scientificto the advice provide analysis and Appropriate legal advice sought and followed. andTrained competent staff in senior positions. withexceptions significant procedures and policies Approved reported to the Audit Committee. Internal and external audit functions in place.

Management • • • • • • • • • • • • • • •

Key strategic Key risk at priorities Risk inherent and climate economic The uncertainties to performance rise give in investmentsthat notthe risk are poorly, perform or safeguarded properly including those in the DB pension scheme. Narrow representation due to lack of diversity Council, the Fellowship, in applicantsgrant science general and arena. and Society The influence loses support,and the Fellowship does not support the activities of the Society. The Society does not comply with legal regulatory requirements.and

Status of risk Improve arrangements for financial planning. arrangements financial Improve for High levels of discretionary expenditure that do not have a awards commitment grant long- attached them and term to funding withdrawal. of the event in clauses termination include Specificallypandemic, the current Officersduring the actively the impact advice the and on government the latest consider Society’s work programme with reprioritisation and diversion of need, and the biggest current of the areas to resources utilisation of opportunities for support where appropriate. Employee engagement surveys informing areas of change. change. of areas surveys informing engagement Employee employees. for available courses internal of Schedule Grants Committee formed of experts in subject area, making them best placed to select applications of ‘excellent science’. performance of againstOngoing review strategy. Policies and procedures in place to govern decision-making processes. remain offerings ensure to evaluations scheme Periodic competitive. and relevant Relevant and appropriate policies are in place. officers safeguarding and group working safeguarding Internal appointed. responsibility with member for Council designated safeguarding. Agree a code of conduct for staff, Fellows and otherrelevant stakeholders. adviceSpecifically government pandemic, monitor during the and opportunities for support, and produce plans for a return to work in the office based on advice and scientific evidence once available. relationships, new develop and existingStrengthen relations seeking to secure additional funding and diversify sources of funding. Oversight of election process by Officers electionCouncil Oversight other and by of process members. members. OfficersCouncil and descriptions for role Clear experience. Identify members with Trustee potential broad Include non-Fellows with relevant expertise on Society committees. Continue to enable willing Fellows to contribute to the Society’s work. from workshops and training induction ongoing and Provide audit specialists. and legal effectiveness board reviews. regular Complete Engage with internal and external audit functions to provide appropriate. support as benefits and compensation to the of benchmarking Ongoing rest of the sector.

Management • • • • • • • • • • • • • • • • • • • • • • • •

Key strategic Key risk at priorities THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS 48 Funding reduced or remaining static has remaining or reduced Funding a negative impact on the Society’s ability to support excellent science. A reduction of income could be due to a government, from funding reduction in by generated income reduced activitiespublishing access open to due trading of failure strategy, journals activities to perform and/or reduced financial to due investment returns crises. The Society does not effectively safeguard its people. Dilution the quality in the science of funded by grants and/or failure to to resources apply theavailable activities the highest quality of are that and are likely to have the most valuable impact to further the Society’s strategic aims. Talented staff not recruited, developed developed recruited, staffnot Talented retained. and Governance structure fails to provide the right level and diversification of expertise to make decisions and run the effectively. Society Risk STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION 51 Council approved the Society’s approved Council budget the for financial 2020/21 year. The budget was revised reflect to changes assumed duethe to impact the and, pandemic althoughof there wassignificant a reduction in the Society’s programmatic key and trading activities, the net financial impact anticipated relatively is modest. The Society concluded a review of operations Hall the Chicheley in at Chicheleyfinancial year. Hall has meetings science hosted numerous in a way that was conductive to knowledge exchange and the development of networks, but much has changed sincethe time of purchase and the Society had exhausted options the make to business financially viable. As such, Council decided progress to with a sale of the property. The management of the property was and, Venues Vere De outsourced to following the closure on March, 23 the wrote to SocietyDe Vere give to notice that the closure was a ‘force subsequently and event majeure’ gave notice on the contract, which expedited theSociety’s next steps to progress with a sale of the property. SCIENCE SHAPING THE WORLD WE LIVE IN Science Policy Committee.Science further made Council considerations of the impact on science and science to decision the UK’s following funding leave the approved EU, the Triennial the Pension of agreement recovery and plan, Valuation the Council agreed and considered matters discussed and register risk on sustainability and the Society’s role in this area. With a view increasing to the diversity submit Officers,to of agreed Council an application the to Charity grants to make to Commission Officers’ parent institutions to reimburse some of the costs that arise from the significant time commitment involved in Officers’ roles. received We the Charity the to consent Commission’s proposal in February (confirmed 2020 by the Commission in an Order in This initiativeMay 2020). is expected bringto more diversity the to field from which Officers, who will continue beto unpaid by the Society, is drawn. followingIn March careful 2020, consideration of the current course of the COVID-19 pandemic, Council a implement to the decision made closure of the Society’s buildings to clientsFellows,conferencing staff, was visitors. other and decision The the our in interests all of taken stakeholders. Although the building was closed, the business of the Society continued with staff working possible. wherever remotely, Meetings and events from the been plannedprogramme that had cancelled were or 2020 for postponed, the and possibility of virtualmoving to platforms with In line considered. government advice, Hall Chicheley closedon 23 March 2020.

Key business in the year Key regular received Council In the year, reports from the Executive Director and Board as well as reports from committees, Audit including key Committee; Diversity Committee; Education Committee; Hooke Committee; Nominations Committee; Committee; Resources and Planning Committee; Engagement Public Industry Science, Board; Publishing Committee; and Translation and Public benefitPublic Fellows not are remunerated for has Council serving Trustees. as complied with its duty due have to regard the to Charity Commission’s benefitpublic when guidance exercising any powers or duties to which that guidance is relevant. Information about benefit public provided by the Society is presented in this report. Committees The Society has a system of committees, which included 46 principalactive CommitteesStanding principaland 28 Working Groups. CommitteesStanding include committees that oversee strands key of the Society’s work, committees to recommendations make that Council recipients of of medals and awards and committees that assess applications and grant for make Committees All Standing awards. agreed termshave of reference by Council that set out the delegations of responsibility that to committee and, the for majority, a member of sitsCouncil the on committee. The committee structure the on diagram following page illustrates the Society’s committee structure by type of business and provides committees on additional information relevant central to business on subsidiaries. and planning finance,

Membership Council of Among the members are Council of the President, who is the Chair of Officers: four Council, and the Biological Secretary, the Foreign Secretary, the Physical Secretary and there During the year the Treasurer. alsowere 18 so-called Ordinary Members. the and President The Officers normally servefive-year the and Ordinaryterms Members serve three-year terms. Changes in the membership of on usual as place took Council 30 which November, is the Society’s membersAnniversary new The Day. received an induction that included a review of relevant documents and presentations duties on Trustee by a partner in a leading charity-law also Council practice. During the year, professional from guidance received advisers on specific matters and developments relevant on updates Trustees.affecting charities and responsibility delegates Council for day-to-day management of the Society’s affairsto the Executive Director. There been have Presidents 61 of the Royal Society since it was founded in the Presidents1660. of Previous Royal Society included have Pepys, Samuel Christopher Wren, Isaac Newton, Joseph Banks, Humphry Davy Ernest and Rutherford. The year ended 31 March is the last2020 full year with the Venki President, Sir current post in Ramakrishnan, the and election process the for new The the began in year. President resultballota of theof Fellowship was confirmed at a meeting of the Society’s Council and on 5 May 2020 Sir Adrian Smith will up take the post of President on 30 November 2020.

Council CharterThe specifies Council that must between have and 24 20 members, each of whom must be a Fellow of theSociety. Council determines the strategic direction of the Society particular in and approves the Society’s strategic plan. Council also approves plans specific for charitable the programmes on relevant of recommendation committees, those and committees activitiesoversee within the Council. behalf of programmes on members. currently 23 are There Council has reflected on the new Charity larger Code for Governance charities supports and the principles set out and the model continuous for improvement. The Society’s constitution ability limits Council’s to conform some to of the principles in the ways that might be adopted by these in other charities; however, instances, the Society seeks alternative means of achieving the a completed Council outcome. same self-assessment in the year based on a series of interviews with Trustees and the results this of review will be used improvements make to the to Society’s governance framework.

THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS Drawing of the Royal Society’s Charles II mace, 1896.

Above: 50 Under the Charter, Council ‘shall ‘shall Council Under the Charter, and may full have authority, power, and faculty from time time to draw to constitute,up, ordain, and make, acts, statutes, laws, such establish constitutions and shall ordinances, as seem them, to or the to major part of them, be to good, wholesome, necessary, and honourable, useful, discretions, sound their to according the betterfor government, regulation, and direction of the Royal Society aforesaid, and of every Member of the same, and do to and perform all the government, to things belonging matters, goods, faculties, rents, lands, tenements, hereditaments, affairs and of the Royal Society aforesaid.’ Structure and management The Society is registered a charity body the is Council Trustee and under charity The Society law. was founded in 1660 and incorporated by SupplementalA Charter. Royal Charter was granted and in 2012, that now serves as the Society’s document.governing governing The body of the Society is its Council, whose members elected are by and thefrom Fellowship. Governance STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION 53

so far as they there aware, are is no audit whichrelevant information of the charity’s unaware; auditors are and they taken have all reasonable steps they ought taken have as to Trustees themselves aware make to order in of any relevant audit information and establishto that the charity’s auditors aware are of that information.

Financial statementsFinancial published on are the charity’s accordance in website with legislation in the UK governing the preparation dissemination and of financial statements, which may vary from legislation in other jurisdictions. and maintenance The integrity of the charity’s website is the responsibility the Council. The of Council's responsibility extends also theto ongoing integrity of the financial statements therein. contained members, Council current The having Council fellow enquiries of made members the and charity’s auditors, confirm that: This report was approved by Council on 6 October and signed on 2020 their behalf by: President of the Royal Society Venki Ramakrishnan Venki • •

SCIENCE SHAPING THE WORLD WE LIVE IN select suitable accounting policies thenand apply them consistently; judgements accounting and make and reasonable estimates that are prudent; state whether applicable United Standards Kingdom Accounting beenhave followed, subject any to departuresmaterial and disclosed the in financial explained statements; and the financial statementsprepare on it is unless basis concern the going inappropriate presume to that the charity will continue business. in

and otherand irregularities. The Council members are responsible members Council The are accounting adequate keeping for records that sufficient are to show and the charity’sexplain transactions and disclose with accuracy reasonable at any time the financial position of the charity ensure them enable to and that the financial statementscomply with the Charities Act 2011. They are safeguarding for responsible also the assets of the charity and hence the for steps taking reasonable for prevention and detection of fraud In preparing theseIn preparing financial statements, the members Council are required to: • • • •

that period. that Statement of Trustees’ ofTrustees’ Statement responsibilities members Council The (who are the of the Trustees Society) are the preparing Trustees’ for responsible reportannual the and financial withstatements accordance in regulations. and applicable law Charity the Council requires law financial statementsfor prepare to accordance in year financial each with United Kingdom Generally Practice Accounting (UnitedAccepted and Standards Kingdom Accounting applicable law). Under charity law the membersCouncil must approve not the financial statements unless they satisfiedare that they give a true and fair view of the state of affairs of the group and charity and of the application and of resources incoming and the including income resources, expenditure, of the group for

boards Trading Trading subsidiary. reports. subsidiary by the trading the by by the trading the by Chicheley Hall.Chicheley Society Trading Society Trading of operations at operations of subsidiary, whose subsidiary, The Board of Royal The Board of Royal committees Programme activities processed and associatedand manage the running manage Society (London) Ltd Ltd Society (London) oversees the tradingoversees activities undertaken Limited oversees the oversees Limited primary purpose is to meetings to present public engagement,public and translation, prizes, translation,and prizes, attend specific Council There are programmes are There committees diversity, in and scientificand meetings, among others.among are they If committees are invited to not themselves membersnot publishing, science policy, policy, publishing, science of Council, Chairs of these Council, Chairsof of education, grants, industry personnel. pay-related Committee remuneration of remuneration key management key matters, including Remuneration The RemunerationThe Committee considers committees trading activities. trading including financialincluding Committees make and subsidiary in a range of areas, Council for approval for Council recommendations to to recommendations system, external audit the effectiveness of the Financial, planning pay-related matterspay-related and planning and budgeting, and planning Society’s internal control and financial statements, financial and Council Committee for approval. for The Planning The oversees theoversees Resources Resources performance, Committee and Resources Resources and Society’s trading Planning andPlanning activities the and monitors financial Society’s financial plan and its and plan annual budgets to Council provision of services and recommends the recommends and research. committees. Fellowship Fellowship committees disciplines and adisciplines and span the scientificspan for election the on for candidates whose candidates are not primarily in Fellows and Foreign Fellows and general and honorary and general the Council Fellowship. committee to advise on contributions to science science contributions to Members are elected by Committee sectional and The members of Council, members of The advice of its of advice Nominations The sectionalThe committees determines the candidates determines by Council are explicit in the terms of reference of committees. of reference of the terms in explicit are Council by managers. Investment Committee The Society’s Committee on investmenton Investment Investment advises Council and oversees the oversees and policy, determines determines policy, performance of theperformance of investment strategy, Society’s investment The Trustee body under charity law. Council has a system of committees and determines the memberships system committees determines a and of has Council body charity under law. Trustee The of committees, which comprise Fellows and many non-Fellows with relevant expertise. Delegations of authority Board programmes. and makes makes and THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS of any actions A subcommittee of Council comprising Council to the financial on behalf of Council of behalf on statements and implementation such as international as such the President and the and the President attention matters, and arising; approves approves arising; affairs, that span many audit and matters the external audit audit programme; programme; audit arising from it with recommendations recommendations and management;and reports, tracks and plan; discusses the discusses plan; associated matters.associated Officers. Board overseesOfficers. Board to Council in relation in Council to the external auditors fundraising and considers and fundraising approves the internal approves reviews internal audit The Audit Committee Audit The Audit CommitteeAudit matters that require urgent matters require that 52 Committee structure STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION 55

number OC305127). and Wales (with Wales registeredand Gatwick 23 October 2020 BDO LLP is eligible appointment for as auditor of the charity by virtue of its eligibility appointment for as auditor of a company under Section 1212 of the Companies Act 2006. BDO LLP is a limited liability partnership England in registered to the Charity’s Trustees those the Charity’s to Trustees matters required are we state to to them in an auditor’s report and no for the fullest extent other To purpose. permitted do we not accept or by law, other responsibilityassume anyone to than the Charity the and Charity’s our for as audit a body, Trustees work, this report, we thefor opinions for or formed.have Use report of the report solelyThis to made is Charity’s in as Trustees, a body, with the Charitiesaccordance Act 2011. Our audit work has been undertaken state might that we so statutoryBDO LLP, auditor

SCIENCE SHAPING THE WORLD WE LIVE IN

Auditor’s responsibilities the for Auditor’s audit the of financial statements been have We appointed as auditor under Section 144 of the Charities Act 2011 and report in accordance with the or made regulations Act relevant and effecthaving thereunder. Our objectives obtain to are about assurance whetherreasonable the financial statementsa whole as misstatement, material from free are whether due fraud to and toor error, report auditor’s includes that an issue is assurance Reasonable opinion. our a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always misstatementdetect when material a it exists. Misstatements can arise from considered are and error fraud or material if, individually or in the aggregate, they could reasonably be expected economic influence the to the basis on users taken of decisions these financial of statements. furtherA our description of the audit for responsibilities of the financial statements is located on the Financial Reporting (FRC) Council website at: www.frc.org.uk/ auditorsresponsibilities part forms description This of our auditor’s report. continued

the information contained the in financial statementsin inconsistent is any material respect with the report; annual or Trustees’ adequate accounting records have Charity; the Parent by been kept not or Charitythe Parent financial statements agreement in not are andwith records the accounting returns; or not have we received all the we explanations and information require our for audit.

Independent auditor’s report auditor’s Independent Matters required on are which we reportto exception by nothing have We report to in respect of the following matters in relation to which the Charities Act2011 requires us report to you if, in to our opinion: • • • • Trustees of Responsibilities As explained more fully in the responsibilities, Trustees’ statement of the responsible are Trustees the for thepreparation financial of statements and being for satisfied that they give a true and fair and view, such for internal control as the determines Trustees is necessarythe enable preparation of to financial statements that are free from misstatement,material whether to due fraud or error. theIn preparing financial statements, the responsible are Trustees for the and Parent assessing the Group’s Charity’s ability continue to as a going applicable, as disclosing, concern, going concernmatters to related and using the going concern basis of either unless the Trustees accounting the the or Group liquidate to intend Parent Charity or cease to operations, or no have realistic alternative but to do so.

Other information the comprises information other The information included the in Trustees’ report financial and statements,other than the financial statements our and reportauditor’s thereon. other The information comprises the Trustees’ the Trustees’ comprises information responsible are report. Trustees The thefor other information. Our opinion on the financial statements the other cover does not information and, the to except extent otherwise explicitly stated our in report, do we not express any form thereon. conclusion assurance of In connection with our audit of the financial statements,responsibility our is read the to other information and, in whether the consider other so, doing information materially inconsistent is with the financial statements our or knowledge obtained in the audit or otherwise materially appears be to misstated. If identify we such material material apparent or inconsistencies misstatements, to required are we material whether a is there determine misstatement the in financial statements misstatement material a or of the other information. If, based on the work performed, have we we conclude that there is a material misstatement of this other information, required are we reportto that fact. nothing have We report to in this regard.

t t concern basis of accounting in the thepreparation financial of statements is not appropriate; or the financial statements any identified uncertaintiesmaterial that castmay significant about doubt the Charity’s the or Parent Group ability the going adopt to continue to concern basis of accounting a for period of at least months 12 from the when the financial statementsdate issue. authorised for are Basis for opinion for Basis conducted accordance audit our in We with on International Standards Auditing (UK) (ISAs (UK)) and Our responsibilities applicable law. thoseunder further standards are described the in auditor’s responsibilities the for audit of the financial statementssection ourof report. independent are We of Charity thethe and Parent Group in accordance with the ethical requirements relevant our to audit of the financial statements in the UK, including the FRC’s Ethical Standard, and fulfilled have we our other ethical with accordance responsibilities in thatthese requirements. believe We the audit evidence obtained have we is sufficient and appropriate toprovide opinion. our for basis a We have nothing have We report to in respect of the following matters in relation to which the ISAs (UK) require us to report where: you to • use ofthehe going Trustees’ • not have disclosedhe Trustees in Conclusions related related Conclusions to going concern to

THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS

have been prepared in accordance accordance in been prepared have with the requirements of the Charities Act 2011. have beenhave properly prepared in with Kingdom United accordance Accounting Generally Accepted Practice; and give a true and fair view the of state of theand of the Group’s Parent Charity’s affairs as at 31 2020 March incoming the Group’s of and application and of resources then ended; the year for resources

54 Opinion on other matter as BEISrequired by grant letter In our opinion, in all material aspects, the grant core payments received the Departmentfrom Business, for Energy & Industrial Strategy (BEIS) beenhave applied the for purposes set out in the grant letter and in with and the terms accordance grant. the core conditions of • • • In our opinion, the financial opinion, theIn our financial statements: auditor’s report auditor’s Opinion audited have We the financial statements of The Royal Society (‘the Charity’)andParent its subsidiaries (‘the ended the year Group’) for which31 comprise March 2020, the statementconsolidated financial of activities, balance the consolidated sheet, the consolidated statement of cash flows and to notes the financial statements, including a summary of significant policies. The accounting financialreporting framework that has been applied in their preparation is Kingdom United and applicable law Standards,Accounting including ReportingFinancial 102, Standard Reportingthe Financial Standard applicable in the UK and Republic of (United KingdomIreland Generally Practice). Accounting Accepted Independent STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION

57 20 (140) 7,513 2019 £’000 ( 7,217 ) 18,186 41,426 49,416 47,856 10,653 13,354 40,430 48,332 (11,581) (11,581) 316,813 (25,403) 316,673 261,260 138,629 324,030 305,092 305,092 Charity 26 (129) 2020 7,992 3,479 4,487 £’000 (9,261) 14,074 47,856 49,476 43,576 36,729 36,989 (10,717) (10,717) (17,253) 277,518 277,518 297,625 123,085 234,075 288,235 288,364 43 (140) 2019 6,508 £’000 (8,142) 17,959 49,416 41,426 47,407 11,4 08 47,856 13,354 40,430 (11,581) (11,581) (26,101) 315,748 304,167 304,167 315,888 261,260 138,629 324,030 Group 40 (129) 2020 4,759 8,219 3,420 £’000 (9,531) 14,074 47,856 49,476 36,729 36,989 43,306 (17,750) (10,717) (10,717) 297,625 277,248 277,248 287,965 123,085 234,075 288,094 SCIENCE SHAPING THE WORLD WE LIVE IN 17 15 18 19 25 23 23 23 23 23 23 20 20 Notes

Net current liabilities Net current Creditors: amounts falling due after more than one year Creditors: amounts falling due within one year liabilities assets current less Total Heritage assets Investments Debtors receivable within one year Cash at bank and in hand Net assets before pension scheme liability scheme pension assetsNet before liability scheme benefitDefined pension assets net Total funds endowment Permanent Treasurer The financial statements were approved and authorisedfor issue by Council on 6 October and signed2020 on its behalf by Hopper Andrew Professor Current assetsCurrent Stocks Fixed assetsFixed assets Tangible Expendable funds endowment Unrestricted funds reserveRevaluation Restricted funds Consolidated and charity balance sheets balance charity and Consolidated 2020 As 31 at March Defined benefit pension reserve benefitDefined pension Unrestricted funds income Total funds Total – 72 Total 2019 276 832 funds £’000 (736) 1,924 8,051 4,753 4,254 4,298 17,367 11,568 83,772 89,246 89,246 18,264 (3,027) 14,501 15,237 110,466 110,466 100,814 111,693 304,167 114,720 289,666 – 76 Total 245 780 805 2020 funds £’000 4,412 4,412 6,851 1,975 4,525 4,265 16,166 11,543 (3,925) 277,248 (27,699) (23,774) (26,919) 304,167 129,779 120,072 133,704 129,292 129,292 104,091 104,091 108,529 – – – – – – – – – – – – – 484 484 484 funds £’000 3,528 3,528 3,044 3,044 (3,305) (15,283) 138,629 138,629 123,085 (15,544) (12,239) Permanent endowment – – – – – – – – – – – – – 127 127 943 funds £’000 (735) 1,070 1,070 41,426 (4,645) (3,702) (4,437) 36,989 endowment Expendable – – 76 413 173 269 638 funds £’000 1,417 1,218 1,004 2,299 (1,634) 15,261 (3,701) (4,919) 93,246 93,246 40,430 40,430 (3,285) 36,729 36,729 Restricted 108,175 108,175 107,537 112,396 112,396 112,809 109,524 – 72 992 780 536 905 funds £’000 3,108 3,108 1,249 1,975 1,966 1,966 2,822 3,388 (2,212) 11,897 10,845 10,905 16,896 16,896 83,682 (4,627) 15,657 (6,839) (3,237) 80,445 20,284 Unrestricted 1 4 3 3 2 5 7 6 18 25 23 Notes

THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS Other income Income from investments from Income Grants charitable activities for furtherance in charitable activities of Trading Other trading activities 56 Consolidated statement of financial activities statement financial of Consolidated 2020 31 March ended theFor year account) (incorporating expenditure and income an Income and endowments from donations endowments from and Income and legacies and All of the above results derived are from continuing activities those except from Royal Society Limited, Trading which ceased trading There no are other on March 23 gains 2020. or losses other than those stated above. The income and expenditure in the consolidated statement of financial activitiesfor the Group to relatethat the discontinued trading subsidiary £1.8m were (2019: £1.8m) and £2.3m (2019: £2.3m), respectively. The consolidated statement of financial activitiesfor is the Group as a whole. The Charity’stotal incomefor theyear was £129.3m (2019: £111.4m). The Charity’s total funds in the decreased year (2019: by £27.6m £14.6m increase). The notes that follow form part of the financial statements. Net (losses)/gains on investments on (losses)/gains Net Expenditure on charitable activities charitable on Expenditure its and benefits science Promoting Providing scientific advicefor policy Supporting and recognising excellence in science in Supporting excellence recognising and Total expenditure Total gains/ net before Net (expenditure)/income investments on (losses) Total income Total Expenditure on raising funds raising Expenditure on Fostering international and global cooperation global and Fostering international Income from charitable activities charitable from Income Net (expenditure)/income for the year the for Net (expenditure)/income Education and public engagement public Education and Actuarial defined benefit gains/(losses) on scheme pension Net movement in funds in movement Net Gross transfersGross between funds Total fundsTotal brought forward Total funds carried forward Total STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION 59 Critical judgements the to relate the treatment multi- of accounting defined benefit scheme. employer Critical estimates accounting and thedefined to relate assumptions benefitscheme. pension Multi-employer benefit defined scheme Certain employees participate in multi-employera defined benefit withscheme other organisations. In the judgement the of Trustees, the Society does not sufficient have information on the plan assets and liabilities be to able reliably to account its for share of the defined benefit obligation and plan assets. In accordance with FRS 102 this is though as it for accounted therefore contribution defined a scheme. were scheme benefitDefined pension The cost the of defined benefit pension scheme and the value of the present value of the scheme liability depend on a number of factors, assumptions including about inflation,rates discount and mortality, which taken are by actuarial specialists. The valuation of particularlythe is scheme sensitive discountto rate assumptions, with a movement0.1% in the discount rate resulting in a £1.2m change in the the liabilities. scheme of value Limited SocietyRoyal Trading During the the Society year, decided progressto with a sale of Chicheley Hall. Royal Society Limited Trading ceased trade to on the closure of Chicheley Hall onMarch 23 2020 following government advice due the to COVID-19 pandemic. Vere end, De year Subsequent to appointed the company Venues, manageto the property since February 2013, gave notice on the SCIENCE SHAPING THE WORLD WE LIVE IN provision has been made the for future costs of terminating the costs business unless such were committed at the reporting date. Critical accounting judgements accounting Critical estimation of sources and key uncertainty In the application of the Group’s the policies Trustees accounting judgements, make to required are estimates assumptions and about the carrying amounts of assets readily not liabilitiesand that are other sources. from apparent Judgements, estimatesand associated assumptions reviewed are based are and basis ongoing an on historical otheron and experience factors that considered are be to relevant, including expectations of future events that believed are be to the under circumstances. reasonable Basis consolidation of financial These statements consolidate the results of the Royal Society and its active wholly owned subsidiaries, Royal Society Trading Limited and Royal Society (London) Ltd, on a line-by-line basis. In the financial consolidated statements have policies accounting uniform been used, with the exception of Royal Society Limited. Trading A financial statement of separate activities the for charity itself is not presented. Cash flow statement The Society meets the definition of a qualifying entity and 102 FRS under has therefore taken advantage of the to relation in exemption disclosure presentation of a cash flow statement in respect of its separate financial statements, presented are which financial thealongside consolidated statements. Accounting policies Accounting 2020 31 March ended theFor year policies principalThe accounting adopted in the preparation of these financial statementsfollows. as are Accounting convention The financial statements have accordance in been prepared with Reporting Financial Standard 102 – ‘The Financial Reporting Standard applicable in the United Kingdom and Republic Ireland’ of (‘FRS 102’) and with the Statement of Practice: Accounting Recommended and Reporting by Charities FRS 102 as revised in 2019 (‘the SORP 2019 Edition’) 2nd together with the reporting requirements of the Charities Act 2011. The financial statements have been the under historical costprepared convention with items recognised cost transaction or at unless value otherwise stated in the relevant policyaccounting note. or been prepared accountsThe have This basis. concern going a on conclusion has been reached after careful consideration future of forecasts which into take account the on-going impact of COVID-19. The Royal Society (‘the Society’) is a Public Benefit Entity as defined by FRS The 102. accounting policies beenhave applied consistently throughout the financial statements and the prior year. the accounts subsidiaryThe of Royal Society Limited been have Trading prepared on a basis other than that of the going concern basis. This applicable, includes, where basis writing the company’s assets down net realisableto value. Provisions alsohave been made in respect of contracts which become have onerous at the reporting No date. - (1) (62) (33) 2019 2019 (174) £’000 £’000 (629) 6,711 1,016 8,051 4,697 2,921 1,535 1,580 1,580 3,790 3,790 (8,051) 17,016 10,974 11,408 11,408 15,237 (21,484) (18,264) 3 1 (40) (84) 2020 £’000 £’000 1,164 7,095 4,759 1,262 3,088 (6,851) 11,408 23,774 (6,649) (8,362) (13,744) (13,744) (27,699) 2 2020 17 15 15 19 18 18 25 20 (20) £’000 6,851 (1,983) 33,863 (31,616) 2 A 17 15 18 18 Notes THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS Net cash (used in)/provided by operating activities by in)/provided (used Net cash Donated heritage assets Donated (Decrease)/increase creditors in contributions cash and charge between pension Difference Decrease in debtors Investment income stocks in Decrease/(increase) Losses/(gains) on investments on Losses/(gains) Loss on the disposal of fixed assets (Decrease)/increase in cash and cash equivalents cash and cash in (Decrease)/increase Cash and cash equivalents at 1 April portfolio to charged Investment fees management Purchase of investments of Purchase activities investment by provided cash Net Cash and cash equivalents at 31 March Proceeds from sale of investments 58 Net (expenditure)/income as per the statement of financial activities financial of statement the per as (expenditure)/income Net A. Reconciliation of net (expenditure)/income net cash to flow from operating activities. Cash flows from investing activities investing from Cash flows Investment income Adjustments for: Depreciation charges Net cash (used in)/provided by operating activities by in)/provided (used Net cash Consolidated statement of cash flows cash of statement Consolidated 2020 31 March ended theFor year Purchase of tangible fixed assets fixed tangible of Purchase Purchase of heritage assets of Purchase STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION 61 Impairment of fixed assets fixed of Impairment investmentsand Fixed assets and investments are subject review to impairment for when there is an indication of a reduction in their carrying value. Total return accounting return Total The Society adopts the use of total return in relation its to permanent endowments expendable and with the exception of the Theo Murphy Australia Fund. Income from the endowments investment gains and and losses recognised are in the endowment column the of statement of financial activities. Unappliedtotal return that is allocated income to funds is presented as an allocation between endowment funds and income funds as a transfer on the face of the statement of financial activities. unapplied total any of amount The return fund is included as part of the relevant endowment together with the value of the trust investment for sheet. theon balance policyThe Trustees’ is distribute to of theup 4% to rolling five-year average capital value of the fund. In that the charitydetermining should adopt a total return approach, the the Charities considered Trustees Return) Regulations(Total 2013 and received advice from Stone King LLP Capital Investment Cazenove and managers. endowment represents core The the part of the assets which the seek maintain to Trustees in real terms. It is based on the value of the endowments at 31 March 2012, together with an allowance for index price inflation consumer (UK (CPI )as determined by the Office for Statistics). National SCIENCE SHAPING THE WORLD WE LIVE IN Additions heritage to assets made are donation. Purchases or purchase by initiallyare recorded at cost and value fair a at recorded are donations practicable.where Society The holds maintainsand these assets principally theirfor contribution knowledge to and culture in line with its charitable aims. do notThe consider Trustees that a reliable estimate the of fair value can be obtained a large for part of the collectionarchives without incurring costs that would the exceed benefits provided. The Society was founded in 1660 and the collection has been built throughout up its and existence the number of assets held in the collection diverse extensive and is in nature. Reliable and relevant information on the cost of many of the assets is therefore not readily available and there is a lack of comparable market values. As such, these assets not are recognised in the accounts. Investments Listed investments held are at fair Unlisted investmentsvalue. are held at cost as an approximation fairto value where the fair value is not obtainable. Private equity investments valued are at fair value based on the latest information from the fund managers. Realised gains and losses on investments sold in and gains unrealised and the year losses on revaluation investments of includedare in the statement of activities.financial Investment are fees management allocated proportionally against the funds investment. under investmentsThe subsidiary in undertakings held are at cost on the Society only balance sheet.

3 – 5 years 3 – 10 years 3 – 10 years 3 – 10 10 – 20 years – 20 10 20 – 30 years20 20 – 5020 years printed books printed archives other and pictures, sculptures works of art other artefacts.

capitalises costing than items more £5,000. Batches of items below this capitalised are threshold if forming part of a larger asset or project and together cost more than £5,000. Depreciation is provided on all assets, excluding freehold land and write assets development, to under off thecost of tangible fixed assets on a straight-line basis over their expected useful lives as follows: Printed books and archives are included on the balance sheet at deemed cost using a valuation performed in 2003. Pictures, art, other and works of sculptures otherand artefacts included are on the balance sheet on a valuation basis. The valuation reflects their fair value and was last performed in 2015. Impairment reviews of these collections undertaken are every 5 – 10 years and when changes circumstancesin indicate. Heritage assets Heritage Heritage assets comprise: • • • • Freehold propertyFreehold improvements: and fixturesFreehold fittings:and Leasehold improvements: fixturesLeasehold fittings:and Computers AV and equipment: Other equipment: assetsOn completion, under development transferred are the to relevant category and depreciated.

Expenditure funds raising on Costs of raising funds include those costs raising donations in incurred legacies.and Expenditure charitable activities on Charitable includes expenditure grants on incurred expenditure all run in other on schemes and awarded pursuance of the Society’s objectives under its including Fellowship Charter, activities primary and purpose trading. The direct costs of supporting these activities, staff including other and costs,overhead separately are analysed and shown as support costs this heading. under Grants recognised are as a liability when the Society formally notifies the recipient the of award. Due to the nature of the funding source for the majority of grant awards, the liability is measured as the totalof expected payments the for period to the next confirmation of income due. Payments due in future periods are commitments. grant as disclosed Any termination liabilities recognised are when a decision cease to the grant is made. Liabilities awards for where more than one year of expected payments provided are at the outset discountedare current to value using a rate equivalent the to opportunity investmentscost from foregone. Tangible fixed assets fixed Tangible fixed assetsTangible are capitalised cost,at price including purchase and any other costs of bringing the condition for working into asset its intended use. The Society only Leased assetsLeased operating under payable Rentals leases charged are the to statement activities financial of the over evenly term of the lease. sufficient evidence to assess that sufficient evidence receipt and probable is receipt can be quantifiedReceipt reliably. of a legacy, in whole or in part, is when probable only considered the charity has been notified of the executor’s intention a make to contribution. contributions annual Fellows’ are recognised in the year in which they due. become Grants charitable activities for Grants when all recognised are met. Where are receipt conditions for restrictionsdonor-imposed apply to the timing of the related expenditure as a precondition of its use the grant is until those income deferred as treated restrictions met. are Grants received specific accounted purposesfor are asfor restricted funds. activities trading from Income activities conferencing from Income takes when the event recognised is publishing from Income place. activities when the recognised is provided.publication is investments from Income onInvestment interest and income deposits is recognised on an accruals on arising Investmentbasis. income endowment funds is credited the to appropriate fund in accordance with conditions.the prescribed Expenditure Expenditure, including irrecoverable is accounted on for an accruals VAT, to Expenditure basis. allocated is the particular activity the cost where relates directly that to activity. Support costs, which cannot be directly attributed a particular to activity, are apportioned based on the costs of staff engaged in direct activities. THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS 60 Legacy income is recognised on recognised is income Legacy a receivable basis when there is Donations accounted are on for a is receipt where basis receivable entitlement is there and probable to Gift include Donations the income. Aid based on amounts receivable at date. the accounting Donations and legacies and Donations Donated goods and services are included at the value the to Society these quantified. can be where No amounts these in included are financial statementsfor services the donated by volunteers or Fellows. Income recognised and accrued is Income entitlement conditions on when are met, receipt can be quantifiedreliably probable. is and At the time the decision was made to to made was the time theAt decision progress with a sale of the property, debtor intercompany an was there between the Society, as the Parent Charity, and Royal Society Trading Limited of £0.8 million. The debt trading the accumulated to due arose several over the company losses of years. After losses of years several Chicheley sell theand decision to deemed longer no itHall, was possible payment recover to and the debt was formally waived in both the subsidiary and parent accounts. management contract.management Without a property the manager, Society will not reopen Chicheley Hall and will expedite the process progress to with a sale of the property. As the trading, the ceased has company financial statementsRoyalof Society ended the year for Limited Trading been have 31 prepared March 2020 on a basis other than that of the going basis. concern Accounting policies continued Accounting STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION

63 10 34 Total Total 2019 2019 2019 123 235 637 832 388 209 funds funds (113) £’000 £’000 £’000 8,017 8,051 (deficit) 1,668 6,543 4,228 6,533 Net surplus/Net 26 34 Total Total (65) 122 259 520 669 805 2020 2020 2020 funds funds £’000 £’000 £’000 4,417 4,417 (deficit) 6,817 6,851 (187)* 1,539 6,625 6,560 Net surplus/Net – – – – – – (5) funds funds Gross £’000 £’000 £’000 3,528 3,528 (2,331) (3,001) (8,602) (2,336) (6,266) (3,265) Permanent Permanent endowment endowment expenditure – – – – – – – – 296 296 296 296 funds funds £’000 £’000 £’000 1,070 1,070 1,644 1,348 1,348 1,348 1,348 lettings internal internal Recharged Recharged endowment endowment Expendable Expendable – – – SCIENCE SHAPING THE WORLD WE LIVE IN 127 269 269 669 funds funds £’000 £’000 £’000 3,192 7,682 1,975 income 1,848 1,848 1,004 1,004 External 13,518 11,543 Restricted Restricted 26 34 251 259 536 funds funds £’000 £’000 1,215 1,249 Unrestricted Unrestricted I Trading I

Bank deposit interest Bank Total Other Fellows’ contributions Fellows’ Trading in furtherance of charitable activities charitable furtherance of in Trading Publishing Notes to the financial statements financial the to Notes 2020 31 March ended theFor year 1 legacies and donations endowments from and ncome Gifts donations and Dividends interest and activities subsidiary through companies Trading Society Hall) Royal Kavli International (Chicheley Centre Legacies Sponsorships Lettings furtherance in objectives of Carlton House Terrace – Total The costs the of Society’s publishing operation and the costs associated with the lettings in furtherance of charitable objects included are in ‘Supporting and recognising in excellence on science’ the face of the statement of financial activities. The costs of trading through subsidiary companies included are in expenditure on raising funds. The Society was from exempt income tax, corporation tax and capital gains tax on income derived from its primary purpose trading charitable and activities. 2 investments from ncome 3 Total consolidated statement financial of activities – note 27 analysis net of assets between funds – note 28 movement on trust and specific funds in year – note 29.

The amounts charged to the amountsThe to charged activities financial statement of contribution defined pension for the employer’s represent schemes contributions payable in the year. The method allocation for of pension costs between funds is allocate to on pro-rataa departmental using basis salary costs as a base. Taxation The Society is a charity within the meaning of Paragraph 1 Schedule 6 of the Finance Act 2010. Accordingly, the Society is from exempt income income on corporation taxes and and gains the to extent that they are charitableapplied to purposes. The generally not trading do subsidiaries pay UK corporation tax because their policy is pay to taxable profits theto Society as Gift Aid. comparatives year Prior In accordance with FRS prior 102, comparativebe can figures year found as follows: Termination benefits Termination benefits payable are Termination when employment terminated is by the Society, or whenever an accepts voluntaryemployee these for redundancy exchange in benefits. amountsto The charged activitiesthe financial statement of represent the best estimate the of expenditure required settle to the obligation at the balance sheet date. • • • discounted at a rate equivalent to the current rate return of on a high- quality corporate bond of equivalent the Scheme to currency term and liabilities. actuarial The valuations obtainedtriennially updated and are balance each rules at 102 FRS under sheet Any date. surplus or deficit is shown in the balance sheet as an asset or liability. The charge the to statement of activitiesfinancial so is calculated as spread to the cost pensions of over employees’ working lives with the Society. The charge comprises the administration costs of running service the current the scheme, cost computed by the actuary under FRS 102 and gains and losses settlementson curtailments. and Past service costs or credits are recognised immediately if the benefitsvested. have If the benefits nothave vested immediately, the costs recognised are over the period until vesting occurs. interest The on the assets and liabilities the for period shown are as a net amount of other financecosts or credits charged or credited the to statement of financial activities. Actuarial recognised losses and gains are the description under immediately losses‘Actuarial on defined benefits scheme’. pension Multi-employer are schemes accounted as for defined contribution schemes as it is not possible identify to the Society’s share the of underlying assets and liabilities on a reasonable and Contributions basis. consistent payable relating funding to of the deficit includedare as a liability on the balance sheet and charged to activities.the financial statement of THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS 62 Defined benefitscheme pension assets measured are atfair value and liabilities on an actuarial basis using the projected unit method and Pension costsPension Fund accounting Fund Restricted funds can only be used particularfor purposes specified by or agreed by the donor. endowment fundsPermanent are funds where the capital must be retained and invested. Expendable endowment funds funds are that must be invested produce to income. Unrestricted funds may be used for purpose the in any furtherance of the general objectives the charity. of The Society has financial assets and financial liabilities of a kind that qualify as basic. Basic financial instruments initially are at recognised transaction subsequently and value measured at their settlement value. Financial instrumentsFinancial Foreign currency currencies foreign in Transactions recordedare at the exchange rate at the date of the transaction. Assets currency liabilities foreign and in translatedare into sterling at the exchange rate at the balance sheet Resulting losses or gains are date. included in the statement of financial activities. Heritage assets reviewed are for impairment at the end of each reporting period ensure to that the carrying value reflects their carrying amounts. Investments held at cost are impairment. annually for reviewed Any impairment is recognised in the category the SOFA in corresponding year in which it occurs. Accounting policies continued Accounting 64 THE ROYAL SOCIETY TRUSTEES’ REPORT AND FINANCIAL STATEMENTS SCIENCE SHAPING THE WORLD WE LIVE IN 65

Notes to the financial statements continued STRATEGIC REPORT

4 Grants for charitable activities 7 Expenditure on charitable activities Expendable Permanent 2020 2019 Grant Unrestricted Restricted endowment endowment Total Total Staff costs Other direct Support 2020 2019 funds funds funds funds funds funds costs £’000 costs £’000 Total Total £’000 £’000 £’000 £’000 £’000 £’000 £’000 (note 10) £’000 (note 8) £’000 £’000 From government and other public bodies Charitable activities Core grant from the Department for Business, Energy Promoting science and its benefits 17 50 175 3 245 276 and Industrial Strategy (BEIS) 992 46,109 – – 47,101 47,101 Supporting and recognising excellence in science 3,984 88,754 6,901 4,452 104,091 83,772 BEIS Investment Research Talent Fund – 31,629 – – 31,629 21,673 Providing scientific advice for policy 1,746 – 553 1,966 4,265 4,298 GOVERNANCE BEIS Newton Fund – 6,137 – – 6,137 6,541 Fostering international and global cooperation 864 13,400 997 905 16,166 17,367 BEIS Global Challenges Research Fund – 15,033 – – 15,033 6,028 Education and public engagement 1,460 292 1,165 1,608 4,525 4,753 Department for International Development – 1,990 – – 1,990 2,415 Total for costs of charitable activities 8,071 102,496 9,791 8,934 129,292 110,466 Other grants from government and public bodies – 182 – – 182 214 From other external bodies 8 Support costs Contribution to charitable activities – 6,457 – – 6,457 5,274 Media 992 107,537 – – 89,246 relations and Facilities and Total 108,529 public building Support 2020 2019 engagement management services Governance Total Total Details of the income to and movement of individual funds are disclosed in note 23. £’000 £’000 £’000 £’000 £’000 £’000 5 Other income Support costs on raising funds 27 108 311 18 464 460 Expendable Permanent 2020 2019 Unrestricted Restricted endowment endowment Total Total Charitable activities funds funds funds funds funds funds Promoting science and its benefits – 1 2 – 3 2 £’000 £’000 £’000 £’000 £’000 £’000 FINANCIAL STATEMENTS Supporting and recognising excellence in science 261 1,039 2,980 172 4,452 4,367 Other Income – 76 – – 76 72 Providing scientific advice for policy 115 459 1,316 76 1,966 1,993 Total – 76 – – 76 72 Fostering international and global cooperation 53 211 606 35 905 905 6 Expenditure on raising funds Education and public engagement 94 375 1,077 62 1,608 1,613 523 2,085 5,981 345 8,934 8,880 Expendable Permanent 2020 2019 Unrestricted Restricted endowment endowment Total Total funds funds funds funds funds funds Total support costs 550 2,193 6,292 363 9,398 9,340 £’000 £’000 £’000 £’000 £’000 £’000 Direct costs on raising funds 473 – – – 473 477 Facilities and building management comprises the rent and running costs (maintenance, insurance, cleaning and security) Support costs on raising funds 464 – – – 464 460 of Carlton House Terrace. Cost of trading 2,311 – – – 2,301 2,311 Support services comprises finance, IT, HR, pension costs and corporate management. Investment management fees 140 413 127 484 1,164 1,016 Total 3,388 413 127 484 4,412 4,254 Support costs are allocated on a pro-rata basis using departmental salary costs as a base. OTHER INFORMATION 66 THE ROYAL SOCIETY TRUSTEES’ REPORT AND FINANCIAL STATEMENTS SCIENCE SHAPING THE WORLD WE LIVE IN 67

Notes to the financial statements continued STRATEGIC REPORT

9 Staff costs 10 Grants 2020 2019 Grants to Grants to 2020 2019 £’000 £’000 institutions individuals Total Total Costs by type £’000 £’000 £’000 £’000 Salaries 10,154 9,534 Fellowships Social security costs 994 957 University Research Fellowships 45,037 45,037 37,648 Pension costs 1,314 1,239 Royal Society Research Professorships 13,856 13,856 12,437 Dorothy Hodgkin Fellowships 6,396 6,396 4,948 Total 12,462 11,730 GOVERNANCE Newton International Fellowships 6,361 6,361 6,640 As required by FRS 102, included in 2020 staff costs is an amount of £238,000 (2019: £244,000) relating to holiday pay FLAIR Fellowships 4,738 4,738 251 owed to staff at 31 March 2020. Sir Henry Dale Fellowships 3,892 3,892 3,550 Pension costs include employer contributions to two Royal Society pension schemes, a defined contribution scheme and a RS Visiting Research Professorships defined benefit scheme, and the Universities Superannuation Scheme (USS) pension scheme as follows: 3,835 3,835 2,740 Newton Advanced Fellowships 3,457 3,457 3,608 • The Royal Society Group Personal Pension Plan (defined contribution): £594,000 (2019: £472,000) RS Challenge Grants 2,871 2,871 1,278 • The Pension and Life Assurance Plan of the Royal Society (defined benefit): £337,000 (2019: £396,000) Wolfson Research Merit Awards • USS: £41,000 (2019: £110,000). 1,822 – 1,822 2,322 The following numbers of employees of the Royal Society earning £60,000 per annum or more received total emoluments Industry Fellowships 1,764 1,764 1,708 within the bands shown: Wolfson Advanced Fellowships 1,380 – 1,380 140 Leverhulme Trust Senior Research Fellowships 486 486 511 2020 2019 International Fellowship Grants 200 200 276 £60,001 – £70,000 8 10 Professorships FINANCIAL STATEMENTS £70,001 – £80,000 8 7 of Public Engagement 22 22 37 £80,001 – £90,000 3 1 £90,001 – £100,000 1 2 Education schemes £100,001 – £110,000 1 – Partnership grants scheme 144 – 144 90 £110,001 – £120,000 2 2 Education Research Fellowships 6 6 2 £120,001 – £130,000 – 1 Other education grants 4 4 7 £130,001 – £140,000 – – £140,001 – £150,000 1 1 Other grant programmes £150,001 – £160,000 1 1 DFID Africa Awards 1,576 1,576 2,046 £160,001 – £170,000 1 – International Exchanges 1,558 1,558 1,787 £170,001 – £180,000 – 1 Entrepreneurs £340,001 – £350,000 – 1 in Residence 874 874 487 £360,001 – £370,000 1 – Leverhulme Trust APEX Awards 579 579 354 OTHER INFORMATION The 14 key management personnel of the Royal Society (2019: 12) received total remuneration of £1,850,000, including Wolfson Laboratory Refurbishment Grants 558 – 558 668 employer’s national insurance contributions (2019: £1,694,000). Other GCRF Programmes 227 227 – Australian Academy of Science Think Tank 200 200 106 The average number of employees, analysed by function, was: Paul Instrument Fund 199 199 196 2020 2019 Awards and prizes 191 191 411 Expenditure on raising funds 6 6 Newton International Exchanges 138 138 202 Expenditure on charitable activities 160 150 Brian Mercer Awards 14 14 143 Support (including governance) 46 44 Foundation for Science and Technology – – 35 Total 212 200 Other 111 111 116 Total 3,904 98,592 102,496 84,744 The average full-time equivalent was 209 (2019: 197). Redundancy and termination payments were made to one employee during the year (2019: 1). Total redundancy and termination payments in respect of this employee were £100,000 (2019: £5,000). 68 THE ROYAL SOCIETY TRUSTEES’ REPORT AND FINANCIAL STATEMENTS SCIENCE SHAPING THE WORLD WE LIVE IN 69

Notes to the financial statements continued STRATEGIC REPORT

University College London 14 316 206 Imperial College London 15 313 174 University of Glasgow 10 292 159 10 Grants continued 11 Reconciliation of grants payable 2020 2019 2020 2019 University of Cambridge 14 208 188 Total Total Total Total University of Birmingham 12 175 97 Number £’000 £’000 £’000 £’000 Recipients of institutional grants Liability at 1 April 12,191 3,052 University of Nottingham 8 175 119 University College London 14 316 206 New grants awarded in year 104,968 86,642 University of Edinburgh 11 143 161 Imperial College London 15 313 174 Grants paid in year (109,902) (75,606) University of Southampton 13 141 150 University of Glasgow 10 292 159 Grants refunded to the Society (2,472) (1,897) GOVERNANCE University of Bristol 14 132 156 University of Cambridge 14 208 188 Liability at 31 March 4,785 12,191 University of Leeds 9 113 125 University of Birmingham 12 175 97 All grants payable fall due within one year. University of St Andrews 5 113 127 University of Nottingham 8 175 119 University of Edinburgh 11 143 161 University of Warwick 12 108 142 University of Southampton 13 141 150 12 Payments to Trustees and related party transactions University of Leicester 5 108 41 University of Bristol 14 132 156 King’s College London 6 101 79 University of Leeds 9 113 125 2020 2019 Total Total University of Oxford 6 85 126 University of St Andrews 5 113 127 £’000 £’000 University of Bath 5 68 56 University of Warwick 12 108 142 Expenses: Travel and subsistence 83 131 University of Leicester 5 108 41 Keele University 1 62 187 King’s College London 6 101 79 No Trustees received remuneration from the Society in the year (2019: Nil). Expenses were reimbursed to or paid on behalf University of York 4 52 48 University of Oxford 6 85 126 of 24 Trustees (2019: 19 Trustees). University of Exeter 5 51 93 University of Bath 5 68 56 Indemnity insurance University of Manchester 8 50 55 Keele University 1 62 187 With the consent of the Charity Commission, the Society has taken out Trustees’ indemnity insurance. The cost of this FINANCIAL STATEMENTS London School of Hygiene and Tropical 1 50 203 University of York 4 52 48 insurance for the year was £9,000 (2019: £8,000). No claims have been made under this policy. Medicine University of Exeter 5 51 93 Grants and awards University of Manchester 8 50 55 Cardiff University 6 40 44 Professor Julia Yeomans FRS was an award holder of an International Exchange Cost Share (Taiwan) grant. The total London School of Hygiene and Tropical Medicine 1 50 203 Queen Mary University of London 3 30 42 value of the award is £12,000. This was awarded and taken up in 2017. No payment was made in 2019/20. Cardiff University 6 40 44 Newcastle University 3 21 40 Queen Mary University of London 3 30 42 Professor Peter Bruce FRS was a co-applicant on a Newton Advanced Fellowship grant. The total value of the award Other organisations 90 957 405 Newcastle University 3 21 40 is £111,000. This was awarded and taken up in the 2018/19 financial year. In the 2019/20 financial year a payment of Total 280 3,904 3,223 Other organisations 90 957 405 £37,000 was made to the University of Oxford. Total 280 3,904 3,223 Professor Jane Langdale FRS was a co-applicant on a Newton International Fellowship grant. The total value of the award is £99,000. This was awarded and taken up in the 2017/18 financial year. In the 2019/20 financial year a Grants are generally awarded to particular individuals, although the actual award is made to the host organisation. payment of £36,295 was made to the University of Oxford. She was also a nominated referee on a Newton Advanced Details of individual grants awarded during the year analysed by organisation are available from the finance department Fellowship grant and a University Research Fellowship grant.

on request. Professor Andrew Hopper FRS was a collaborator (co-applicant’s Head of Department Overseas) on a Science OTHER INFORMATION Conference Follow-on Travel Grant. Professor Richard Catlow FRS was a nominated referee on a Newton International Fellowship grant and Industry Fellowship grant. Professor Karen Steel FRS was a nominated referee on a Newton Advanced Fellowship grant. Professor Thomas McLeish FRS was a nominated referee on an Apex Award grant. Professor Richard Jones FRS was a nominated referee on an Entrepreneur in Residence grant. Other Sir Venki Ramakrishnan, President of the Royal Society, has use of the President’s flat at Carlton House Terrace. Related party transactions The Royal Society had two wholly owned trading subsidiaries during the year, Royal Society Trading Limited (registered number 06967016) and Royal Society (London) Ltd (registered number 08808518). Details of transactions with these subsidiaries are set out in note 26. 70 THE ROYAL SOCIETY TRUSTEES’ REPORT AND FINANCIAL STATEMENTS SCIENCE SHAPING THE WORLD WE LIVE IN 71

Notes to the financial statements continued STRATEGIC REPORT

13 Total expenditure includes the following amounts: 15 Tangible fixed assets – Group and charity 2020 2019 Chicheley Chicheley Total Total Hall Hall £’000 £’000 freehold computers Computers Assets Operating lease rentals and property and other Leasehold and other under improvement equipment improvements equipment development 2020 2019 Plant and machinery 79 75 £’000 £’000 £’000 £’000 £’000 £’000 £’000 Rent 490 490 Cost 569 565

At 1 April 17,682 722 20,979 3,926 110 43,419 42,790 GOVERNANCE Fees payable to the Charity’s auditors for: Additions 272 25 1,006 621 59 1,983 629 The audit of the Charity and Group accounts 35 33 Disposals – (63) (152) (441) – (656) – The audit of the Charity’s subsidiaries accounts pursuant to legislation 6 6 Transfers – – 22 55 (77) – – Total audit fees 41 39 At 31 March 17,954 684 21,855 4,161 92 44,746 43,419

Charges on owned assets Depreciation Depreciation 1,262 1,580 At 1 April 14,179 653 12,382 2,851 – 30,065 28,485 1,262 1,580 Charge for year 80 47 771 364 – 1,262 1,580 Disposals – (62) (152) (441) – (655) – 14 Financial memoranda Transfer – – – – – – – Income and expenditure relating to government grants during the year was as follows: At 31 March 14,259 638 13,001 2,774 – 30,672 30,065

2020 2019 Total Total Net book value at 31 March 2020 3,695 46 8,854 1,387 92 14,074

£’000 £’000 FINANCIAL STATEMENTS Net book value at 31 March 2019 3,503 69 8,597 1,075 110 13,354 Department for Business, Energy and Industrial Strategy – core grant Income 47,101 47,101 All tangible fixed assets are used for the support of charitable activities within the Society. Expenditure (47,101) (47,101) The Group and the charity have freehold property with a net book value of £3,695,000 (2019: £3,503,000). – – Department for Business, Energy and Industrial Strategy – Investment in Research Talent Fund Income 31,629 21,673 16 Capital commitments – Group and charity Expenditure (31,629) (21,673) 2020 2019 – – £’000 £’000 Department for International Development grant Authorised and contracted for 182 37 Income 1,990 2,415 Authorised but not contracted for 1,497 2,567 Expenditure (1,990) (2,415) Total Commitment 1,679 2,604 – – BEIS Global Challenges Research Fund At the balance sheet date, £712,000 (2019: £1,157,000) of capital commitments was authorised for refurbishment of OTHER INFORMATION Income 15,033 6,028 6 – 9 Carlton House Terrace. A further spend of £576,000 (2019: £695,000) had been authorised on an IT project. Expenditure (15,033) (6,028) There was no spend authorised for the historic maintenance of Chicheley Hall (2019: £305,000). Other general capital – – items total £391,000 (2019: £447,000). Of these commitments £182,000 (2019: £37,000) has been contracted for by BEIS Newton Fund year end. Income 6,137 6,541 Expenditure (6,137) (6,541) – – 72 THE ROYAL SOCIETY TRUSTEES’ REPORT AND FINANCIAL STATEMENTS SCIENCE SHAPING THE WORLD WE LIVE IN 73

Notes to the financial statements continued STRATEGIC REPORT

17 Heritage assets – Group and charity 17 Heritage assets – Group and charity continued The Society holds an extensive collection of heritage assets relating to the history of the Society itself and the wider 2020 2019 2018 2017 2016 history of scientific endeavour. The collection has four main components: Five-year financial summary of heritage asset transactions £’000 £’000 £’000 £’000 £’000 Purchases/donations Printed works: The Library contains over 70,000 titles, published from the 1470s to the present day. The main strength Printed books 1 7 1 13 13 of the collection is in the 17th and 18th centuries; from the 1680s to the mid-19th century, the policy of the Library was to acquire every important scientific publication. Archives 37 51 – 23 4 Pictures, sculptures and other works of art 22 37 20 9 54

Archives: These comprise an extraordinary and unrivalled record of the development of science that spans nearly Other artefacts – – – 4 – GOVERNANCE 350 years. The archive collection is a unique resource for historians, particularly historians of science, containing over Total purchases/donations 60 95 21 49 71 250,000 items. It includes the Society’s Charter Book and the manuscript of Isaac Newton’s Principia Mathematica. Donated heritage assets are recognised in the year they are received. There have been no disposals of heritage Pictures, sculptures and other works of art: The collection includes over 200 original works (primary collection) and approximately 10,000 photographs and engravings (secondary collection), many of them portraits of past and present assets within the last five years. Fellows. Preservation and management Expenditure which in the Trustees’ view is required to preserve or clearly prevent further deterioration of individual Other artefacts: The collection comprises approximately 250 items and includes scientific instruments, furniture and furnishings, and the Society’s Charter Book. collection items is recognised in the income and expenditure account when it is incurred. The collections are accessible to scholars and the wider public through the Royal Society’s History of Science The Society has an ongoing cataloguing project and the Society’s major strategic facilities for the long-term Centre, which includes a reference library and an extensive online presence, including a fully searchable catalogue preservation of its historic archives, manuscripts and printed books are environmentally controlled store rooms and image library. (conforming to British Standard BS EN 16893:2018). The Society’s modern records have been subject to a full audit, completed in April 2011. This process enabled the Assets held Assets held at cost at valuation 2020 2019 full-life management, destruction and permanent archiving of pertinent files. Conservation of both old and new

Summary of heritage asset transactions £’000 £’000 £’000 £’000 archives is now underway. FINANCIAL STATEMENTS Purchases/donations Each of the Society’s major collections (archives, modern records, printed books, pictures, journals, objects) has a At 1 April 36,248 13,168 49,416 49,321 designated member of curatorial staff and exhibited materials are looked after by an exhibitions manager. Collections Additions 20 40 60 95 are managed and recorded in discrete databases and according to the prevailing standard in each area (for example, Valuation or cost at 31 March 36,268 13,208 49,476 49,416 International Standard Archival Description (ISAD) for archival cataloguing, SPECTRUM for museum standards and The heritage assets comprise picture control). In 2018, the Society’s archives achieved accredited status (for procedures and service quality) with Printed books 13,278 13,277 the UK National Archives. Archives 22,965 22,928 Pictures, sculptures and other works of art 9,462 9,440 Other artefacts 3,771 3,771 Total 49,476 49,416

The printed books and archives were valued by Roger Gaskell, a rare book dealer, in August 2003 and the pictures and other artefacts by Weller King, Fine Art Dealers, in 2015. The valuations are on a fair market/replacement basis on those parts of the collection where it is felt such a valuation can be reasonably made. Assets are held at valuation OTHER INFORMATION as a proxy for cost. The paintings and furniture at Chicheley Hall were valued in March 2015 by Weller King, Fine Art Dealers. The valuations are on a fair market/replacement basis on those parts of the collection where it is felt such a valuation can be reasonably made. The Trustees consider there to be no material impairment on the present market values/replacement values compared with those stated. 74 THE ROYAL SOCIETY TRUSTEES’ REPORT AND FINANCIAL STATEMENTS SCIENCE SHAPING THE WORLD WE LIVE IN 75

Notes to the financial statements continued STRATEGIC REPORT

18 Investments – Group and charity 19 Debtors 2020 2019 2020 2019 £’000 £’000 Receivable Receivable Valuation at 1 April 261,260 239,544 within one within one year year Additions of investments 31,616 25,905 £’000 £’000 Disposal of investments (40,903) (22,619) Trade debtors 1,450 2,136 Net change in cash invested for trades within portfolio 8,527 (4,422) Grants receivable 1,159 2,610

Investment management costs (1,164) (1,016) Legacy receivable 96 665 GOVERNANCE Net cash (withdrawn from)/added to portfolio (1,487) 5,604 Other debtors 100 228 Net gains on valuation at 31 March (23,774) 18,264 Accrued income 188 383 Valuation at 31 March 234,075 261,260 Prepayments 427 486 Total historical cost at the end of the year 190,245 189,708 Total 3,420 6,508

The valuation at 31 March 2019 comprises: Included in the Group debtors are debtors of £64,000 (2019: £151,000) of Royal Society Trading Limited and Nil (2019: Investments listed on a recognised stock exchange including investments and unit trusts: £30,000) of Royal Society (London) Ltd. All other debtors relate to the Charity. UK 104,101 130,322 Overseas 97,277 103,022 Other unlisted securities: 20 Creditors UK 9,633 10,652 2020 2020 2019 2019 Due within Due after Due within Due after Overseas 4,540 5,109 one year one year one year one year Cash: £’000 £’000 £’000 £’000 FINANCIAL STATEMENTS UK 13,094 5,656 Trade creditors 2,094 - 1,603 - Overseas 5,430 6,499 Publications advanced sales 3,586 - 3,876 - Total 234,075 261,260 Chicheley Hall advanced sales 232 - 211 - Grants payable 4,785 - 12,191 - Overseas investments comprise equities, unit/investment trusts and fixed interest funds. Other creditors 359 - 328 - The Society owns 100% of the issued share capital of Royal Society Trading Limited (note 26). The principal activity of the Accruals and provisions 935 129 2,302 140 company is conferencing activities at Chicheley Hall. Deferred income 5,759 - 5,590 - Total 17,750 129 26,101 140 The Society owns 100% of the issued share capital of Royal Society (London) Ltd (note 26). The principal activity of the company is corporate sponsorships. Included in the Group creditors are creditors of £488,000 (2019: £774,000) relating to Royal Society Trading Ltd Funds are invested as follows: and £9,000 (2019: £4,000) relating to Royal Society (London) Ltd. All other creditors relate to the Charity. 2020 2019 As required by FRS 102, included within accruals and provisions 2020 is a provision for a liability under the deficit £’000 £’000 recovery plan for the USS multi-employer pension scheme. A total amount of £140,000 has been provided for, Specific investments – Amadeus RSEF 9,536 8,621 comprising £11,000 due within one year and £129,000 due within more than one year. This provision has been OTHER INFORMATION Specific investments – Theo Murphy Australia Fund 2,720 3,480 calculated using the modeller developed by the British Universities Finance Directors Group (BUFDG), with the Pooled investments 222,734 248,244 support of the USS Trustee company, to provide a tool for estimating the liability under the recovery plan for Total 234,075 261,260 accounting purposes.

Reconciliation of deferred income 2020 2019 £’000 £’000 Deferred income brought forward 5,590 6,073 Amount released from previous year (5,590) (6,073) Income deferred in the year 5,759 5,590 Total 5,759 5,590 76 THE ROYAL SOCIETY TRUSTEES’ REPORT AND FINANCIAL STATEMENTS SCIENCE SHAPING THE WORLD WE LIVE IN 77

Notes to the financial statements continued STRATEGIC REPORT

21 Statement of total returns 23 Movements on trust and specific funds in year – Group Expendable Permanent 2020 Unapplied Transfers/ Unapplied endowment endowment Total total return application total return Total at £’000 £’000 £’000 Relevant Relevant at 1 April Investment of total at 31 31 March Investment returns Permanent value b/f Indexation value c/f 2019 Income gain Expenditure Indexation return March 2020 endowment funds £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 2020 £’000 Investment Income 1,070 3,528 4,598 Life Sciences Trust 11,313 170 11,483 5,170 428 (1,754) (59) (170) (587) 3,028 14,511 Capital losses (4,645) (14,448) (19,093) Maths and Investment management costs (127) (484) (611) Physical Sciences GOVERNANCE Total return for year (3,702) (11,4 0 4) (15,106) Trust 10,378 156 10,534 4,770 394 (1,612) (54) (156) (540) 2,802 13,336 Indexation (436) (1,433) (1,869) RW Paul Less application of total return (735) (3,305) (4,040) Instrument Fund 11,127 167 11,294 4,842 415 (1,700) (57) (167) (266) 3,067 14,361 Net total return for the year (4,873) (16,142) (21,015) Theo Murphy – UK 53,336 800 54,136 22,052 1,960 (8,025) (269) (800) (1,658) 13,260 67,396 Unapplied total return Other permanent At 31 March 2020 7,475 24,107 31,582 endowments 9,339 140 9,479 3,415 331 (1,357) (45) (140) (254) 1,950 11,429 At 31 March 2019 12,348 40,249 52,597 Total permanent endowments part of the unapplied 22 Analysis of net assets between funds – Group total return 95,493 1,433 96,926 40,249 3,528 (14,448) (484) (1,433) (3,305) 24,107 121,033 Expendable Permanent 2020 2019 Funds not part of Unrestricted Restricted endowment endowment Total Total the unapplied total funds funds funds funds funds funds £’000 £’000 £’000 £’000 £’000 £’000 return FINANCIAL STATEMENTS Funds balances at 31 March are represented by: Theo Murphy – Tangible fixed assets 14,074 – – – 14,074 13,354 Australia 2,887 _ 2,887 _ _ (835) _ _ _ _ 2,052 Heritage assets 49,476 – – – 49,476 49,416 Total permanent Investments 37,272 36,729 36,989 123,085 234,075 261,260 endowments 98,380 1,433 99,813 40,249 3,528 (15,283) (484) (1,433) (3,305) 24,107 123,085 Net current liabilities (9,531) – – – (9,531) (8,142) Unapplied Transfers/ Unapplied Creditors: due after one year (129) – – – (129) (140) total return application total return Total at Defined benefit pension scheme liability (10,717) – – – (10,717) (11,581) Relevant Relevant at 1 April Investment of total at 31 31 March Net assets 80,445 36,729 36,989 123,085 277,248 304,167 Expendable value b/f Indexation value c/f 2019 Income gain/(loss) Expenditure Indexation return March 2020 endowment funds £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 2020 £’000 The net current liabilities in 2020 are funded by investments, which could be realised to meet the net liabilities as they General Trust fall due. Fund 10,848 163 11,011 5,444 421 (1,827) (50) (163) - 3,825 14,836 Life Sciences Trust 6,631 99 6,730 3,060 250 (1,087) (30) (99) (345) 1,749 8,479 Included in the Group net current liabilities are liabilities of £270,000 (2019: £925,000) of Royal Society Trading Limited. Maths and

All other net current liabilities relate to the charity. Physical Sciences OTHER INFORMATION Trust 3,610 54 3,664 1,689 137 (594) (16) (54) (189) 973 4,637 Other expendable funds 7,989 120 8,109 2,155 262 (1,137) (31) (120) (201) 928 9,037 Total expendable endowment funds 29,078 436 29,514 12,348 1,070 (4,645) (127) (436) (735) 7,475 36,989

Indexation has been applied using the annual CPI rate of 1.5% in March 2020 (March 2019: 1.9%). 78 THE ROYAL SOCIETY TRUSTEES’ REPORT AND FINANCIAL STATEMENTS SCIENCE SHAPING THE WORLD WE LIVE IN 79

Notes to the financial statements continued STRATEGIC REPORT

23 Movements on trust and specific funds in year – Group continued The Revaluation Reserve relates to the revaluation of the heritage assets. Carried 23 Movements on trust and specific funds in year – Group continued Brought Investment forward at forward at and actuarial 31 March The transfers between projects and funds include administration charges of the investments held in the trusts, administration 1 April 2019 Income gain/(loss) Expenditure Transfers 2020 costs reclaimed from projects where applicable, notional interest paid to projects in respect of income held during the year £’000 £’000 £’000 £’000 £’000 £’000 and any income released to the general reserves at the end of projects (where allowed under the gift or grant agreement). Restricted funds Life Sciences Trust 5,963 173 (57) (1,712) 452 4,819 24 Financial commitments – Group and charity

Maths and Physical Sciences Trust 4,783 125 (217) (1,339) 414 3,766 At 31 March 2020 the Society had the following commitments: GOVERNANCE Enterprise Fund 9,536 – (605) (310) – 8,621 Total future minimum lease payments under a non-cancellable operating lease in respect of occupation of 6–9 Carlton House Terrace, London, is as follows for each of the following periods: Other restricted funds 20,148 109,226 (755) (109,448) 352 19,523 Total restricted funds 40,430 109,524 (1,634) (112,80 9) 1,218 36,729 2020 2019 £’000 £’000 Less than one year 490 490 Unrestricted funds One to five years 1,960 1,960 General Trust Fund 15,698 406 (756) (47) 47 15,348 Over five years 19,110 19,600 BEIS Science and Research – 992 – (992) – – Total 21,560 22,050 Revaluation Reserve 47,856 – – – – 47,856 Defined Benefit Pension Reserve (11,581) – 780 84 – (10,717) The lease is due to expire on 5 January 2064; however, the next 10-yearly rent review is due on 5 January 2025. General purpose 31,709 14,259 (1,456) (19,329) 2,775 27,958 Agreements and commitments to fund research professorships or fellowships and other grants totalling £171,000,000 Total unrestricted funds 83,682 15,657 (1,432) (20,284) 2,822 80,445 (2019: £194,000,000). Of these, £92,000,000 (2019: £79,000,000) are due in less than one year, and £79,000,000 (2019: Purposes of funds £115,000,000) in between two and five years. There are no grants payable in more than five years. As the Society retains The objects of the Life Sciences Trust are to promote and advance for the general benefit of the public, including the the discretion to terminate these grants they are treated as liabilities of future periods and will be financed by specific grants FINANCIAL STATEMENTS scientific (science, medicine, engineering and technology) community, the study and investigation of, and research into, or other income receivable in those periods. all areas of the life sciences and other science at the interface between this area and other areas of science. This shall be The Society has entered into investment contract commitments totalling £510,000 (2019: £489,000) payable at dates yet to done in particular by supporting scientists working in this area, advancing engagement of the public in all matters relating to be agreed. such science and providing the best possible scientific advice and information to those making policy in the area of the life sciences. 25 Pension obligations – Group and charity The Royal Society (‘the Employer’) operates a defined benefit pension arrangement in the UK called the Pension and Life The objects of the Maths and Physical Sciences Trust are to promote and advance for the general benefit of the public, Assurance Plan of the Royal Society (‘the Plan’), with assets held in a separately administered fund. The Plan provides including the scientific (science, medicine, engineering and technology) community, the study and investigation of, and retirement benefits on the basis of members’ final salary. The Plan is closed to new members, although it remains open to research into, all areas of mathematics and the physical sciences and other science at the interface between this area and future benefit accrual, and provides benefits on a defined benefit basis. other areas of science. This shall be done in particular by supporting scientists working in this area, advancing engagement of the public in all matters relating to such science and providing the best possible scientific advice and information to those The most recent valuation of the Plan under FRS 102 was carried out as at 31 March 2020. The valuation of the Plan used making policy in the area of mathematics and the physical sciences. the projected unit method and was carried out by Barnett Waddingham LLP, professionally qualified actuaries. Following the Deed of Retirement of the other Trustees the property and investments of the RW Paul Instrument Fund The FRS 102 liability does not include any allowance for discretionary benefits. The Employer expects to make contributions were transferred to the sole remaining Trustee, being the Royal Society. The application of the income from the portfolio is to the Plan during the year to 31 March 2021 of around £1,700,000 (2020: £1,110,000). OTHER INFORMATION restricted to the provision of grants under the Paul Instrument Grants Scheme. The Plan is subject to the Statutory Funding Objective under the Pensions Act 2004. A valuation of the Plan is carried out The Theo Murphy Funds (in the UK and Australia) were created through a bequest from the estate of the late Theo Murphy. at least once every three years to determine whether the Statutory Funding Objective is met. As part of the process the The funds ‘shall be used or applied to further scientific discovery in the fields of medicine, science, technology and Employer must agree with the Trustees of the scheme the contributions to be paid to address any shortfall against the engineering’. The Australia Fund will carry out activities in Australia in accordance with the Will. Statutory Funding Objective and contributions to pay for future accrual of benefits. The objects of the General Fund are to promote and advance for the general benefit of the public, including the scientific The full actuarial valuation at 1 January 2019 showed an increase in the deficit from £3,716,000 to £8,732,000. It has been (science, medicine, engineering and technology) community, the efficiency and effectiveness of the Royal Society and its agreed with the Trustees that the Employer will pay £652,000 on or before each 30 April and 31 October in the years 2020 Fellowship. This shall be done in particular by establishing, promoting, supporting and maintaining, for the general benefit to 2026 inclusive to meet the deficit. of the public and the scientific community, its activities, premises, fixtures and fittings, equipment, libraries and archives, Contributions payable by the Employer in respect of future benefit accrual and expenses are at the rate of 28% of general publications and the history of science. pensionable salaries. Members’ contributions are 7% of pensionable salaries. Life cover and dependants’ pensions in The Enterprise Fund was created by generous donations in support of the Society in making equity investments in respect of death in service are provided by additional insurance premiums. innovative early stage businesses emerging from the science base in the UK and elsewhere. Other restricted funds comprise monies received to fund separate restricted projects in line with our charitable activities and are held as separate individual funds in our accounts. 80 THE ROYAL SOCIETY TRUSTEES’ REPORT AND FINANCIAL STATEMENTS SCIENCE SHAPING THE WORLD WE LIVE IN 81

Notes to the financial statements continued STRATEGIC REPORT

25 Pension obligations – Group and charity continued 25 Pension obligations – Group and charity continued The principal assumptions used to calculate Plan liabilities include: Reconciliation of present value of scheme liabilities 2020 2019 % pa % pa Value at 31 Value at 31 March 2020 March 2019 Inflation (RPI) 2.8 3.3 £’000 £’000 Inflation (CPI) 2.0 2.3 Defined benefit obligation at 1 April 59,080 57,241 Salary escalation 2.0 2.0 Current service cost 450 449 Increase to pensions in payment* – subject to LPI minimum 4% 4.1 4.2 Contributions by Plan participants 103 116 GOVERNANCE Increase to pensions in payment* – subject to LPI 2.7 3.2 Past service cost – 59 Statutory revaluation 2.0 2.3 Interest cost 1,462 1,522 Discount rate (pre- and post-retirement) Benefits paid (1,323) (1,863) 2.3 2.5 Change due to settlements or curtailments – – 105% of Experience (gain)/loss on liabilities 111 (161) Pre-retirement mortality table S3NA S2NA Changes to demographic assumptions 86 (1,341) 105% of Changes to financial assumptions (899) 3,058 Post-retirement mortality table S3NA S2NA Defined benefit obligation at 31 March 59,070 59,080 CMI_2019 projections with LTR of Sensitivity analysis of the scheme deficit 1.25% pa CMI_2018 The sensitivity of the present value of the scheme deficit to changes in the principal assumptions used is set out below. and initial projections addition of with LTR of Change in Post-retirement mortality projection 0.25% pa 1.5% pa Change in liabilities assumption £’000 20% of 20% of FINANCIAL STATEMENTS Tax-free cash pension pension Discount rate −0.10 % 1,162 Withdrawals None None Rate of inflation* −0.10 % (691) Commutation No commutation 1,858 * Pensions in payment increase by the lesser of the annual increase in the retail price index (RPI) or 5%. For service prior to 1 November 2001 this is subject 1% pa long-term to a minimum increase of 4%. rate of mortality Mortality improvements (616) Under the mortality tables and projections adopted, the assumed future life expectancy at age 60 is as follows: * Other assumptions linked to the rate of inflation are also assumed to change appropriately. 2020 2019 Male currently aged 40 28.2 years 28.4 years Reconciliation of fair value of scheme assets Female currently aged 40 30.8 years 30.6 years Male currently aged 60 26.8 years 26.6 years Value at 31 Value at 31 March 2020 March 2019 Female currently aged 60 29.4 years 28.8 years £’000 £’000 Fair value of scheme assets at 1 April 47,499 46,222 The assets in the Plan were: OTHER INFORMATION Interest on assets 1,182 1,238 Value at 31 Value at 31 Contributions by the Employer 1,054 1,114 March 2020 March 2019 £’000 £’000 Contributions by scheme participants 103 116 Equities 16,916 21,820 Benefits paid (1,323) (1,863) Index-linked gilts – – Administration costs (240) (148) LDI portfolio 10,793 9,956 Return on Plan assets less interest 78 820 Multi-asset fund 4,266 – Fair value of scheme assets at 31 March 48,353 47,499 Cash 1,056 134 The actual return on Plan assets in the year was £2,210,000 (2019: £2,060,000). Diversified growth 8,874 10,166 Annuity policies 6,448 5,423 Total market value of Plan assets 48,353 47,499 Present value of scheme liabilities (59,070) (59,080) Net pension liability (10,717) (11,581) 82 THE ROYAL SOCIETY TRUSTEES’ REPORT AND FINANCIAL STATEMENTS SCIENCE SHAPING THE WORLD WE LIVE IN 83

Notes to the financial statements continued STRATEGIC REPORT

25 Pension obligations – Group and charity continued 26 Subsidiary undertakings Analysis of the amount charged to the statement of financial activities – operations The Society owns 100% of the £1 called-up and issued share capital of Royal Society Trading Limited 06967016. Royal Value at 31 Value at 31 Society Trading Limited has been set up to process the activities that occur at Chicheley Hall. On 23 March 2020, the March 2020 March 2019 Directors of Royal Society Trading Limited agreed to cease operations immediately and the charity (Parent) agreed to £’000 £’000 waive the debt owed by the subsidiary. This has been treated as a capital contribution directly to shareholders’ funds in the Current service cost 450 449 subsidiary. The annual accounts for the financial year ended 31 March 2020 were not prepared on a going concern basis. Administration costs 240 148 Interest cost 1,462 1,522 The Society also owns 100% of the £1 called-up and issued share capital of Royal Society (London) Ltd 08808518. Royal GOVERNANCE Interest on assets (1,182) (1,238) Society (London) Ltd has been set up to process corporate sponsorships at the Society. Past service cost – 59 Royal Society Royal Society Trading (London) Ltd Limited Total charge 970 940 2020 2019 2020 2019 £’000 £’000 £’000 £’000 Actuarial gains and losses Results for the year ended 31 March: Value at 31 Value at 31 Trading income March 2020 March 2019 £’000 £’000 Internal income – – 296 413 Gains on scheme assets in excess of interest (78) (820) External income 127 127 1,848 1,797 Experience losses (gains) on liabilities 111 (161) Cost of sales – – (2,273) (2,268) Losses (gains) from changes to demographic assumptions 86 (1,341) Gross profit/(loss) 127 127 (129) (58) Losses (gains) from changes to financial assumptions (899) 3,058 Administrative expenses (5) (4) (46) (43) Actuarial (gains)/losses (780) 736 Operating profit/(loss) 122 123 (175) (101) Interest on loan account to parent – – (12) (12)

The Royal Society (‘the Employer’) operates two pension schemes and contributes to the USS. Gift Aid payable to Parent Charity (122) (123) – – FINANCIAL STATEMENTS During the year one member of the Society’s staff was a member of USS, a defined benefit scheme (2019: two members). Result for the period – – (187) (113) During the year ended 31 March 2020, employer contributions to this scheme totalled £41,000 (2019: £110,000). The Total funds brought forward at 1 April – – (925) (812) employer contribution rate at year end was 21% (2019: 18%). Capital contribution from parent charity – – 842 – Total funds carried forward at 31 March – – (270) (925) USS is a defined benefit scheme which is externally funded and valued every three years by professionally qualified independent actuaries using the Projected Unit Method. The scheme is a ‘last man standing’ scheme, which means that in the event that another member institution becomes insolvent the other participating members will pick up any funding Balance sheet as at 31 March: shortfall. Current assets Stock – – 14 23 At the date of the latest actuarial valuation of the scheme (31 March 2020), the assets were sufficient to cover 84% of the Debtors – 30 64 231 benefits that had accrued to members; the deficit at 31 March 2020 was £12.9 billion (2019: £5.4 billion). Cash at bank and in hand 132 122 140 632 Based on expected contributions until 31 March 2031, the net present value of the payment towards the reduction of the 132 152 218 886 deficit is estimated using the modeller developed by the BUFDG, with the support of the USS Trustee company, as a tool Creditors: amounts falling due within one year (132) (152) (488) (1,811) for estimating the liability under the recovery plan for accounting purposes. An initial liability of £184,000 was charged to Net current liabilities – – (270) (925) OTHER INFORMATION the statement of financial activities during 2015/16 and recorded as a liability on the balance sheet to be unwound over time (initially over the period to 2031) as the liability is discharged; to 31 March 2020, £44,000 of this provision has been released. Capital and reserves Further information can be found at https://www.uss.co.uk Called-up share capital – – – – Profit and loss reserve – – (270) (925) Shareholder’s funds – – (270) (925)

Royal Society (Australia) Pty Limited ACN 126112678 is the Trustee of the Royal Society Theo Murphy (Australia) Fund. It is an Australian company, the shares of which are owned by the Society. 84 THE ROYAL SOCIETY TRUSTEES’ REPORT AND FINANCIAL STATEMENTS SCIENCE SHAPING THE WORLD WE LIVE IN 85

Notes to the financial statements continued STRATEGIC REPORT

27 Prior year comparison – Consolidated statement of financial activities 28 Prior year comparison – Analysis of net assets between funds – Group For the year ended 31 March 2019 Expendable Permanent 2019 (incorporating an income and expenditure account) Unrestricted Restricted endowment endowment Total funds funds funds funds funds Expendable Permanent 2019 £’000 £’000 £’000 £’000 £’000 Unrestricted Restricted endowment endowment Total Funds balances at 31 March 2019 are represented by: funds funds funds funds funds Notes £’000 £’000 £’000 £’000 £’000 Tangible fixed assets 13,354 - - - 13,354 Income and endowments from donations and legacies 1 638 194 - - 832 Heritage assets 49,416 - - - 49,416 Income from charitable activities Investments 40,775 40,430 41,426 138,629 261,260 GOVERNANCE Grants for charitable activities 4 992 88,254 - - 89,246 Net current liabilities (8,142) - - - (8,142) Trading in furtherance of charitable activities 3 10,960 608 - - 11,568 Creditors: due after one year (140) - - - (140) 11,952 88,862 - - 100,814 Defined benefit pension scheme liability (11,581) - - - (11,581) Other trading activities 3 1,924 - - - 1,924 Net assets 83,682 40,430 41,426 138,629 304,167 Income from investments 2 1,804 1,208 1,172 3,867 8,051 Other income 5 7 65 - - 72 Total income 16,325 90,329 1,172 3,867 111,693 29 Prior year comparison – Movements on trust and specific funds in year – Group Raising funds 6 3,370 361 114 409 4,254 For the year ended 31 March 2019 Expenditure on charitable activities 7 Carried Promoting science and its benefits 73 203 - - 276 Brought Investment forward at Supporting and recognising excellence in science 11,056 72,716 - - 83,772 forward at and actuarial 31 March 1 April 2018 Income Expenditure Transfers gain/(loss) 2019 Providing scientific advice for policy 1,993 2,305 - - 4,298 £’000 £’000 £’000 £’000 £’000 £’000

Fostering international and global cooperation 905 16,462 - - 17,367 Permanent endowment funds FINANCIAL STATEMENTS Education and public engagement 3,020 1,733 - - 4,753 Life Sciences Trust 15,277 474 (50) (555) 1,338 16,484 17,0 47 93,419 - - 110,466 Maths and Physical Sciences Trust 14,038 435 (46) (509) 1,230 15,148 Total expenditure 20,417 93,780 114 409 114,720 RW Paul Instrument Fund 14,571 450 (48) (266) 1,261 15,968 Net (expenditure)/income before net (losses)/gains on Theo Murphy – UK 69,272 2,149 (227) (1,875) 6,069 75,388 investments (4,092) (3,451) 1,058 3,458 (3,027) Theo Murphy – Australia 2,774 - - - 113 2,887 Net (losses)/gains on investments 18 1,406 2,962 2,903 10,993 18,264 Other permanent endowments 11,6 4 0 359 (38) (189) 982 12,754 Net (expenditure)/income for the year (2,686) (489) 3,961 14,451 15,237 Total permanent endowment funds 127,572 3,867 (409) (3,394) 10,993 138,629 Gross transfers between funds 23 2,966 1,099 (671) (3,394) - Actuarial losses on defined benefit pension scheme 25 (736) - - - (736) Expendable endowment funds Net movement in funds (456) 610 3,290 11,057 14,501 General Trust Fund 14,756 454 (44) - 1,125 16,291 Total funds brought forward 84,138 39,820 38,136 127,572 289,666 Life Sciences Trust 8,959 276 (27) (199) 683 9,692 Total funds carried forward 83,682 40,430 41,426 138,629 304,167 Maths and Physical Sciences Trust 4,967 152 (15) (178) 373 5,299 Other expendable endowments 9,454 290 (28) (294) 722 10,144 Total expendable endowment funds 38,136 1,172 (114) (671) 2,903 41,426 OTHER INFORMATION

Restricted funds Life Sciences Trust 5,416 340 (488) 488 207 5,963 Maths and Physical Sciences Trust 6,437 261 (2,668) 516 237 4,783 Enterprise Fund 7,854 - (255) - 1,937 9,536 Other restricted funds 20,113 89,728 (90,369) 95 581 20,148 Total restricted funds 39,820 90,329 (93,780) 1,099 2,962 40,430 STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION 87

SCIENCE SHAPING THE WORLD WE LIVE IN Executive Director Dr Julie Maxton Personnel Management Key Andrew Allen, Director of International Affairs Jennifer Cormack, Director Development of Officer Financial Chief Mary Daly, Richard Gascoigne, Director of IT Bill Hartnett, Director of Communications Director Human Resources of Kelly, Linda Rupert Lewis,Chief Science Policy Officer Dr Paul McDonald, Director of Grants Programmes Lesley Miles, Chief Strategy Officer Dr Alan Pitt, Director of Fellowship and Governance Affairs DirectorDr Stuart of Publishing Taylor, Auditor Statutory BDO LLP 2 City Place Road Ring Beehive Gatwick RH6 0PA Bankers The Royal Bank of Scotland 1 Princes Street London 8BP EC2R Managers Investment BrothersRathbone PLC Finsbury8 Circus London EC2M 7AZ Auditors Internal KPMG LLP Canada15 Square London E14 5GL Registered Charity Number 207043 Registered address 6 – 9 Carlton House Terrace London SW1Y 5AG royalsociety.org

Reference and administrativeReference details * Retired 30 November 2019 ** Appointed 30 November 2019 CommitteeAudit Chair Beddington John Sir President Ramakrishnan Venki Sir Treasurer ProfessorAndrew Hopper SecretaryPhysical Professor BrucePeter Foreign Secretary ProfessorRichard Catlow Secretary Biological John Skehel* Sir Partridge** Linda Dame Members Council of Michael AshfoldProfessor Professor Keith Ball* Professor Gillian Bates* Professor David Beerling** Professor Jean Beggs* Dr Mariann Bienz BorysiewiczSir Leszek Campbell* Eleanor Professor ChristlProfessor Donnelly** Dr Christopher Dye Professor Russell Foster* Chris HawkesworthProfessor Ion Sue Dame Jones** Richard Professor Langdale** Jane Professor McLeish Thomas Professor Professor Richard Morris** Dame Bridget Ogilvie* Radford Sheena Professor Professor Maria Grazia Spillantini Steel Karen Professor Tillmann Ulrike Professor Heyningen** van Veronica Professor Professor Julia Yeomans - - 2019 £’000 Carried 9,536 2,887 10,144 31 March 20,148 32,139 47,856 47,856 31,709 31,709 12,754 15,698 31,989 15,968 15,968 83,682 83,682 75,388 25,230 forward at (11,581) (11,581) 304,167 - - - – 113 581 581 670 760 760 982 722 646 £’000 (736) (736) 1,771 1,261 1,937 1,840 6,069 2,228 17,528 gain/(loss) Investment and actuarialand ------– 45 45 95

(171) £’000 (189) (294) (266) (266) 2,921 2,921 2,966 2,966 (1,875) Transfers - - – (45) (48) 174 174 (28) (89) (38) £’000 (992) (992) (255) (227) (565) (2,729) (20,417) (19,554) (19,554) (90,369) (114,720) Expenditure - - - - - – 359 450 992 992 848 848 290 606 £’000 2,149 1,090 1,060 Income 14,727 14,727 16,325 89,728 111,693 - - £’000 2,774 7,854 9,454 Brought 20,113 14,571 84,138 11,6 4 0 47,856 47,856 14,446 14,446 25,442 29,652 69,272 32,855 32,855 29,202 (11,019) (11,019) forward at 289,666 1 April 2018 THE SOCIETY ROYAL TRUSTEES’ REPORT AND FINANCIAL STATEMENTS P

Other endowments permanent Theo Murphy – UK Theo Murphy – Australia RW Paul Instrument Paul RW Fund Total for all trustsTotal Trust Sciences Life Trust Sciences Physical Maths and General Trust Fund General Trust BEIS Science and Research and BEIS Science Other endowments expendable Fund Enterprise 86 Total unrestricted funds Total For the ended year 31 March continued 2019 General purpose Unrestricted funds Fund General Trust 29 –Movements comparison year rior on trust and specificyear funds – in Group Revaluation ReserveRevaluation Other restricted funds Research and BEIS Science Revaluation ReserveRevaluation Total General purpose Defined Benefit Pension ReservePension Benefit Defined Defined Benefit Pension ReservePension Benefit Defined 88 THE ROYAL SOCIETY TRUSTEES’ REPORT AND FINANCIAL STATEMENTS

The Royal Society is a self-governing Fellowship of many of the world’s most distinguished scientists drawn from all areas of science, engineering, and medicine. The Society’s fundamental purpose, as it has been since its foundation in 1660, is to recognise, promote, and support excellence in science and to encourage the development and use of science for the benefit of humanity.

The Society’s strategic priorities emphasise its commitment to the highest quality science, to curiosity-driven research, and to the development and use of science for the benefit of society. These priorities are: • Promoting excellence in science • Supporting international collaboration • Demonstrating the importance of science to everyone

For further information The Royal Society 6 – 9 Carlton House Terrace London SW1Y 5AG T +44 20 7451 2500 E [email protected] W royalsociety.org

Registered Charity No 207043 Issued: October 2020 DES7073