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Crisis of finance and governance at Royal Institution

Governance | Tania Mason | 19 Jan 2010

A funding crisis has erupted at the Royal Institution, the charity that exists to connect people with science, prompting trustees to scrap the post of director and make Baroness Greenfield, the prominent neuroscientist who held the post, redundant.

The charity, whose patron is the Queen, announced last week that it had completed stage one of a governance review and “concluded that the requirement for the functions of the role of director as currently defined has ceased to exist”.

According to newspaper reports, the trustees decided that the post of full-time director was no longer affordable in light of recent funding problems.  A refurbishment of the Institution's Mayfair headquarters instigated by Greenfield has left the charity facing a shortfall of more than £3m -  a deficit on unrestricted funds of £1.6m and net current liabilities of £1.5m. 

According to the most recent auditor's report, some of the funds used for the refurbishment project came from restricted and endowment funds and the charity has had legal advice that this money should not have been used for these purposes.  These monies must now be replenished.

The deficit has prompted the charity’s auditors, Mazars, to question its ability to continue operating.  In their submission to the Charity Commission, dated 29 September 2009, the auditors said: “If the charity is to continue as a going concern, the financial projections for the three years ending 30 September 2011 need to be met. There is a significant uncertainty as to whether these projections will be achieved.”

Baroness Greenfield left the organisation with immediate effect on 8 January.

Publicly, the trustees paid tribute to her work, describing her as the “driving force behind numerous initiatives, notably, the recent visionary refurbishment project and the renowned Science Media Centre”.  They concluded: “Baroness Greenfield leaves with our thanks and we wish her all the very best in her future endeavours”.

But the parting was anything but amicable, according to reports. Baroness Greenfield (pictured) has said she is considering a legal challenge against her dismissal, and there has been speculation that her propensity for publicity – some have described it as self-promotion – did not sit well with the conservative male board members. 

The trustees said the Institution would continue to deliver its main charitable objectives under the direction of chief executive officer Chris Rofe and a senior team. “Over the coming months the organisation will focus on strengthening its finances, fundraising, and addressing the organisational governance,” they declared.

Some observers have said that the Institution now needs to find external funding support and might do well to replace some or all of the trustees.  A leader in the FT this week read: “As an organisation that does some research but exists primarily to promote science, the RI cannot thrive in the modern world without the active involvement of scientists who are outstanding at research and/or communication. With Lady Greenfield’s departure it has no one.”
  

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