A financial policy focused on the medium and long term
In 2019, EPFL will celebrate its 50th anniversary as a federal institute of technology. Over the decades, the School has shown that it is capable of growing spectacularly, adding more and more innovative projects to the already long list of achievements across its three coremissions – education, research and innovation.
This expansion did not stop in 2018, when we rolled out a number of ambitious educational initiatives, made scientific breakthroughs that will have a global impact, and continued to fulfill our mission of transferring technology to the rest of society.
At 4.2%, growth in student numbers outstripped expectations – a further sign of the School’s appeal both within Switzerland and abroad. We also took steps to strengthen EPFL’s role in Switzerland’s innovation ecosystem and entered into a number of key public- and private-sector partnerships. New chairs were created both on the School’s main campus and at its outposts in Valais, Geneva, Neuchâtel and Fribourg, with major investments across all these sites.
Our school stands out because it is dynamic, quick to seize opportunities and capable of obtaining competitive funding from diverse sources, including industry. Last year, third-party funding accounted for 33% of total financing, a record for a Swiss federal institute of technology. It is thanks to this funding that we are able to expand our research and enhance Switzerland’s competitiveness in cutting-edge scientific fields. It also gives us greater autonomy to grow and strengthen our capacities so that we can maintain our status as one of the best institutes of technology in the world.
EPFL’s financial policy is geared towards the medium and long term. It is designed to help us fulfill our strategy and missions and ensure that resources are allocated judiciously and that our activities are sustainable. As the School rapidly expands, the infrastructure, buildings and state-of-the-art laboratories have to be constantly updated with the latest technologies in the areas of research and education. This requires major investment in both infrastructure and scientific equipment, and drives up operating expenses. In recent years, this has prompted us to develop shared tech platforms that allow researchers to use these resources optimally and efficiently.
In 2018, consolidated operating expenses rose 1.8% to CHF 1.048 billion, primarily as a result of inflation, higher energy costs and an increase in depreciation expenses.
Total consolidated income edged up to CHF 1.052 billion (+0.1%). Federal funding was up just 1.1% owing to budget restrictions, and competitive funding, primarily from the Swiss National Science Foundation, also increased. This was offset by a decline in donations and bequests, which are more volatile from one year to the next.
Federal funding – the main pillar of the School’s financing – amounted to CHF 704 million. Funding from the Swiss National Science Foundation, other Swiss government entities, Innosuisse and European Union framework programs for research make up the second pillar and came in at CHF 185 million. The third pillar comprises funding from private-sector partnerships, industry and not-for-profit organizations, together with income from services rendered, tuition fees, and donations and bequests. This third pillar totaled CHF 163 million in 2018.
In 2018, the value of new research contracts reached its highest level since 2015, with the resulting funding set to be spread over the coming months and years. These contracts involved both national and international public funds as well as third-party funds from companies and not-for-profit organizations. Partnerships with companies saw the sharpest growth, up 40% versus 2017 and representing a total of CHF 35 million.
This growth in third-party funding will help drive EPFL’s expansion, enrich our exchanges with our partners and allow us to further develop our research activities. In this regard, it is essential for us to maintain our independence in our teaching and research as well as in our strategic and financial management.
EPFL’s consolidated full-year accounts offer a transparent view of the School’s financial health and of its income, expenses and assets. The financial statements are prepared under IPSAS; in 2018 EPFL joined the small number of public universities around the world with IPSAS certification.
Caroline Kuyper – Vice President, Finance