Annual Report 2016–17 Australia’s innovation catalyst CSIRO, in partnership with Deakin University, launched Australia’s first carbon fibre production facility. Carbon fibre is a low weight product with high rigidity, tensile strength and chemical resistance that is used in aerospace, civil engineering, cars, health and the military. Successful collaborations like this demonstrate how the Australian research sector can accelerate research, lead innovation and expand job opportunities in the country. About this report This annual report is a summary of CSIRO’s activities and financial position for the 12-month period ended 30 June 2017. In this report, unless otherwise stated, references to the ‘organisation’, ‘we’, ‘us’ and ‘our’ refer to CSIRO as a whole. In this report, references to a year are to the financial year ended 30 June 2017, unless otherwise stated. It is also available at: www.csiro.au/annualreport2017. COVER: Nanomaterials, like the carbon nanotubes illustrustrated on the front cover, are extremely small chemicals, millionths of a millimetre in size. They come in many forms each with unique mechanical, electronic and optical properties. Through the development of new products and processes, nanotechnology will potentially contribute solutions to major challenges facing Australia in the electronic, energy and environmental sectors. Image: Amanda Barnard, Data61 i www.csiro.au CSIRO Head Office Clunies Ross Street, Acton ACT 2601 GPO Box 1700, Canberra ACT 2601 Australia T (02) 6276 6000 • ABN 41 687 119 230 1 September 2017 The Hon Arthur Sinodinos AO Minister for Industry, Innovation and Science Parliament House CANBERRA ACT 2600 Australia’s national science agency took strides forward on its Strategy 2020 through the year ending 30 June 2017. We have pleasure in submitting to you, for presentation to Parliament, the sixty-ninth Annual Report of the Commonwealth Scientific and Industrial Research Organisation (CSIRO) that demonstrates the results and benefits delivered for industry, government and the community. This report has been prepared in accordance with the Science and Industry Research Act 1949; section 46 of the Public Governance, Performance and Accountability Act 2013 (PGPA Act), and the Public Governance, Performance and Accountability Rule 2014 (PGPA Rule). It was endorsed for presentation at the meeting of the CSIRO Board on 1 September 2017. In addition to reviewing the excellent science, strong collaboration and breakthrough innovation performed at CSIRO, this annual report includes an overview of the investments made through the Science and Industry Endowment Fund, established under the Science and Industry Endowment Act 1926. It includes an overview from the Chief Executive of CSIRO as Trustee of the Fund, and a report by the Auditor-General on the accounts of the Fund. The Corporate Commonwealth Annual Reporting Rule requires we report any significant activities and changes that affected CSIRO’s organisation or structure. During the reporting period, CSIRO established its first office in the United States, demonstrating its commitment to take Australian innovation to the world and return benefits and value to Australia. The office will build on CSIRO’s existing partnerships and research in the US, creating a strategic hub to strengthen and grow new relationships and opportunities for the benefit of our science, our people, and our nation. We commend this record of achievement to you. Mr David Thodey AO Dr Larry Marshall Chairman of the CSIRO Board Chief Executive of the CSIRO ii CSIRO Annual Report 2016–17 Contents PART 1 1 OVERVIEW 2 Australia’s CSIRO 6 Foreword by the Chairman 8 Chief Executive’s report 10 Highlights of 2016–17 12 Our global science impact PART 2 15 ANNUAL PERFORMANCE STATEMENTS 16 Statement of preparation 16 Purpose 16 Results 17 Performance against our strategy 27 Performance of Portfolio Budget Programs 28 Program 1.1: Research – Science, Services and Innovation Fund 49 Program 1.2: National Research Infrastructure – National Facilities and Collections 65 Program 1.3: Science and Industry Endowment Fund PART 3 71 OUR ORGANISATION 72 How we are organised 74 Management and accountability 82 Board membership 83 Executive Team members 84 Health and safety 85 Environmental performance 90 Our people 94 Awards and honours PART 4 99 FINANCIAL STATEMENTS 100 Independent Auditor’s Report 102 Financial Statements PART 5 143 APPENDICES 144 Service charter 144 Administrative law 146 Consultancy services 148 Science and Industry Endowment Fund Annual Report 2016–17 161 Full list of CSIRO locations PART 6 163 INDEXES 164 Acronyms 166 Glossary 168 Index 177 Statement of Expectations Index 178 Compliance index: statutory reporting requirements 181 Contacts iii Solar troughs on top of Stockland Wendouree Shopping Centre in Ballarat, Victoria, capture heat that powers the centre’s air conditioning system. Our cutting edge technology reduces the building energy demands and operating costs. iv CSIRO Annual Report 2016–17 Part 1 | Overview 2 AUSTRALIA’S CSIRO 6 FOREWORD BY THE CHAIRMAN 8 CHIEF EXECUTIVE’S REPORT 10 HIGHLIGHTS OF 2016–17 12 OUR GLOBAL SCIENCE IMPACT Part 1 | Overview 1 Australia’s CSIRO For over a century, CSIRO has been pushing the boundaries of what’s possible in science and technology to solve the nation’s biggest challenges and seize the opportunities on the horizon. More than 5,000 CSIRO experts across 59 locations turn science into solutions, working in partnership with government, industry, universities and the community. We are at the forefront of world-class science; we are embedded across our national research system, and we are reaching out globally to extend the impact of Australian innovation and return benefits and value back home. Our proud legacy invented fast Wi-Fi, Aerogard and polymer banknotes. Today we’re helping to find the first gravitational waves in space, growing gluten-free grains and pioneering new renewable energy sources, just to name a few. Our science and research is not just tackling today’s challenges, it is preparing for tomorrow’s. We partner with schools and universities to grow our national pipeline of science, technology, engineering and mathematics professionals. We are stewards of national facilities and collections that plumb the depths of our oceans and the reaches of our skies, and we partner with businesses of all sizes to bring science into their workplace from researcher placements to strategic forecasting and insights. We believe in the power of science to Dr Bryan Lessard (also known as Bry the Fly Guy), transform our lives and secure our futures, visits the Daintree Rainforest National Park in and we realise that ambition every day. Far North Queensland, in a quest to find new species of soldier fly for the Australian National Insect Collection. Soldier flies have not been studied in Australia for over 50 years, despite many being agriculturally important species. Image: Youning Su. 2 CSIRO Annual Report 2016–17 We are Australia’s innovation catalyst Australia must seize the opportunities of a rapidly changing world if it is to secure its future prosperity. An innovative, globally-competitive Australia needs a united innovation system – a vision CSIRO is uniquely placed to drive. CSIRO’s Strategy 2020 recognises Australia’s single biggest opportunity: closing the gap between our research and industry. Our best ideas are being applied domestically, but also exported overseas, delivering benefit and economic returns elsewhere. Australia needs an innovation catalyst, and CSIRO is well placed to take this role and turn more of our world-class research into benefit for Australia. By bringing together our unwavering commitment to brilliant science and national benefit, with partners across industry, government, the research sector and the community, CSIRO is a vibrant and integral part of securing Australia’s future success CSIRO Data61’s Magnapod – a highly and prosperity. flexible legged-robot equipped with controllable magnetic adhesion, making In order to achieve our vision and purpose, it capable of inspecting confined spaces. we are committed to: Customer first Excellent science Creating deeper innovation relationships Using breakthrough technology with our customers and prioritising the and knowledge and being a trusted highest-value investments. advisor for Australia. Collaboration hub Deliver on commitments Integrating the best solutions for Enhancing our agility, financial our customers, increasing our sustainability and capability to flexibility and enhancing Australia’s respond at the speed of business. innovation performance. Global outlook, national benefit Inclusion, trust and respect Delivering connectivity to the global Fully enabling and supporting the science, technology and innovation innovation capacity of our creative frontier as well as accessing new people and teams to take risk and markets for Australian innovation. deliver to customers. Breakthrough innovation Health, safety and environment Increasing our capability to help Enhancing staff safety and wellbeing reinvent existing industries and create as we continue to move towards new industries for Australia and deliver ‘zero harm’. public good. Part 1 | Overview 3 Transforming today’s challenges into tomorrow’s opportunities Our core research and focus areas extend from the depths of our oceans to the far reaches of our galaxy, as we turn science into solutions that tackle the biggest challenges facing our nation. AGRICULTURE AND FOOD ASTRONOMY AND