NSERC 2030: Discovery. Innovation. Inclusion.
Discussion papers
Supporting high-risk, high-reward research
This document is one of a series of discussion papers generated by NSERC staff to foster discussion during the development of the NSERC 2030 strategic plan. Items presented do not represent policy directions; they are meant to elicit discussion among NSERC’s stakeholders. Similarly, all themes discussed in these papers are cost-neutral: they would not require new program funding or cuts to existing programming in order to fund new initiatives.
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Overview
In recent years, the research community and funders are concerned that increasing conservatism results in research that provides only incremental advances. According to an Organisation for Economic Co-operation and Development 2021 policy paper, “The underlying concern… is that failure to encourage and support research on risky, ‘out of the box’ ideas may jeopardise a country’s longer-term ability to compete economically, to harness science for solving national and global challenges, and to contribute to the progress of science as a whole” (OECD, 2021a).
Features of high-risk high-reward research have been identified as “basicness,” generality (applicability to a wide number of research fields) and novelty (i.e., a leap forward from the state of the art) (OECD, 2021b). The Council of Canadian Academies (CCA) report Powering Discovery (CCA, 2021) notes that high-risk, high-reward research is often multi/interdisciplinary and could be better supported by more flexible, non-traditional funding mechanisms. The challenge for funding agencies is to balance the competing factors that contribute to their organizational and financial risk: the potential impact of the proposal and the probability of a successful outcome. Avoidance of risk by researchers, who depend on successful grant applications, means that many ideas with high potential for impact may never be submitted. Factors that contribute to the difficulties of supporting risky research range from funding agencies’ desire to be accountable for use of public funds, to the conservatism of review panels in competitive funding environments, to the researchers’ desire to avoid failure of a research project, which could negatively impact their tenure and promotion prospects.
Following the Canada’s Fundamental Science Review (Advisory Panel on Federal Support for Fundamental Science, 2017), which stated that improved support for high-risk, high-reward is one of the “modern characteristics of a vibrant research ecosystem,” new funding in Budget 2018 led to the Tri-Agency New Frontiers in Research Fund (NFRF). The fund supports interdisciplinary and high-risk research with two years of funding. Projects are not required to span the mandate of more than one granting agency but must propose an innovative interdisciplinary approach. Novel review mechanisms are applied (e.g., double-blind review, interdisciplinary review panels). The expectation of project failure is acknowledged in competition literature and instructions to committee members. Short-term grants are intended to balance the financial risk for funding agencies while providing sufficient time to test ideas. Successful projects would be considered to be “de-risked” ideas and could then be submitted to other funding agency programs for longer-term support. The first NFRF-funded projects are still underway; as a result, no data are yet available on the success of the program design in supporting high-risk, high-reward research. Based on NFRF, high-risk, high-reward research in the NSERC context can be defined as research that proposes to explore something new, which might fail, and has the potential for significant impact. It may bring together different natural sciences and engineering (NSE) disciplines, although the latter is not a requirement. The potential for high reward balances the risk that it might fail and can include economic, scientific or technological impact, transformative or disruptive thinking, etc.
Efforts to improve the support of high-risk, high-reward within NSERC’s programs have been underway for at least the last 20 years, primarily within the Discovery portfolio of programs. Discovery grants (DG), which support fundamental research programs, allow great flexibility in research directions during the relatively long five years of funding. These characteristics of DG may promote some degree of risk-taking in research (CCA, 2021 p.62–64); in fact, the 2020 Evaluation of the Discovery Research Program found that DGs allowed researchers to take risks and follow unexpected paths, while Discovery Accelerator Supplements allowed for acceleration of these elements. However, researchers commented that funding levels were insufficient; therefore, inadequate funding could limit the extent to which funded programs can incorporate high-risk elements. In survey results from phase 1 engagement on NSERC 2030, high-risk, high-reward research was not highlighted as a high priority for respondents.
Research supported by NSERC programs that requires partner cash contributions tends to have a lower risk of failure. Although some Alliance and new college funding opportunities do not require matching funds and incorporate factors that encourage high-risk, high-reward research, it is not a main objective, and it is too early to assess potential high-reward impacts. This aligns with the Conference Board of Canada’s Innovation Report Card (Conference Board of Canada, 2021) which gave a low rating for business R&D, noting that, until recently, “Canadian businesses have had little competition, high resource prices, generally good trade ... and other favourable conditions … [T]hey haven’t had to innovate as much as businesses in other countries to be profitable.”
One interesting program that emphasizes individual researchers and their potential impact is the US National Institute of Health’s Director’s Pioneer Awards (one of the institute’s high-risk, high-reward programs [NIH ACD, 2019]); this and other successful and promising practices noted in the CCA report (CCA, 2021, p.91) are worth considering as NSERC determines its future strategy with respect to high-risk, high-reward research.
Opportunities
NSERC could explore different funding opportunity approaches to foster high-risk, high-reward NSE research. Some practices are identified in the CCA report.
The recognition and evaluation of high-risk, high-reward within existing NSERC funding programs could be improved by building high-risk, high-reward explicitly into evaluation criteria and merit indicators and by providing additional instruction and guidance to reviewers so that risky proposals are not penalized. High-risk, high-reward elements could be considered as value-added but not as a requirement. EDI and other impacts would have to be considered and mitigated.
Ideas for new funding opportunities focused on high-risk, high-reward include:
- prizes to recognize and support Discovery grantees who have bold proposals and potential for major breakthroughs
- developing an NSERC funding opportunity that allows successful NFRF-Exploration grantees to further exploit their “de-risked” research
- developing a funding opportunity for high-risk, high-reward NSE research, which could include elements such as clear language to define high risk, removal of preliminary data requirements and extended funding periods with increased flexibility to change research direction
- NSE funding opportunities focused on solving global grand challenges that are often long-term, high-risk, interdisciplinary, multi-sectoral and international and that require novel collaborations
Opportunities also exist for new policy approaches to support high-risk, high-reward in all NSERC programs (e.g., described in the OECD and CCA reports). These include improved training for peer reviewers and novel review processes (e.g., double-blind review, applications without personal information, “golden vote” or randomized selection process). Further, evaluating and managing risk/reward considerations at the research portfolio level rather than for individual projects may enable risk-taking at the project level.
Considerations
Many countries and funding agencies are seeking improved support for high-risk, high-reward research. If Canada, and NSERC, fail to adequately support high-risk, high-reward research, Canada risks falling behind other countries in terms of opportunities to grow the economy and to contribute to the solution of global challenges. Further, a lack of action may limit Canada’s capacity to attract and retain the brightest minds and foreign investment. However, an increased emphasis on high-risk, high-reward research may be challenging to justify, both to government and to the public. Enhanced support for high-risk, high-reward research by NSERC may be viewed as unnecessary, since NFRF is an inter-agency program. Further, risks are associated with implementation methods (e.g., if DGs offer the sole mechanism, early career researchers may be discouraged from seeking funding for high-risk, high-reward research ideas, as unsuccessful DG applications or research and/or failure of highly qualified personnel could impair tenure and promotion prospects).
To measure success in supporting high-risk, high-reward research, NSERC could draw on methods used in other programs and their evaluation (e.g., NFRF, US National Institutes of Health Director’s Pioneer Awards) — both at the program design and individual project levels. Performance indicators for high-risk, high-reward projects could include the percentage of funded projects that fully or partially meet proposed project goals (while expecting a certain percentage of project failures), and the extent to which the results were achieved by challenging current perspectives and/or using difficult approaches or techniques.
Discussion questions
- What barriers and challenges currently limit high-risk, high-reward research from being conducted in Canada’s academic, public and private sectors?
- How important is it to support high-risk, high-reward research in the NSE, rather than in interdisciplinary research more broadly?
- How could NSERC leverage novel program design and review approaches to improve the support of high-risk, high-reward research through its funding opportunities (new and existing)?
- What are the risks and benefits of designing a new NSERC funding opportunity to encourage and support high-risk, high-reward research versus modifying or improving existing programs?
References
Advisory Panel on Federal Support for Fundamental Science. (2017). Investing in Canada’s Future: Strengthening the Foundations of Canadian Research. Ottawa, ON: Canada’s Fundamental Science Review. Retrieved from http://www.sciencereview.ca/eic/site/059.nsf/vwapj/ScienceReview_April2017-rv.pdf/$file/ScienceReview_April2017-rv.pdf
Conference Board of Canada. (2021). Innovation Report Card. https://www.conferenceboard.ca/focus-areas/innovation-technology/innovation-report-card
Council of Canadian Academies. (2021). Powering Discovery: The Expert Panel on International Practices for Funding Natural Sciences and Engineering Research. Ottawa, ON: Council of Canadian Academies. Retrieved from https://cca-reports.ca/wp-content/uploads/2021/05/Powering-Discovery-Full-Report-EN_DIGITAL_FINAL.pdf
National Institutes of Health, Advisory Committee to the Director. (2019). Report of the ACD Working Group on High-Risk, High-Reward Research. Retrieved from https://acd.od.nih.gov/documents/presentations/06132019HRHR_B.pdf
OECD. (2021a). Effective policies to foster high-risk/high-reward research. OECD Science, Technology and Industry Policy Papers, No. 112. Paris, France: OECD Publishing. Retrieved from https://doi.org/10.1787/06913b3b-en
OECD. (2021b). Quantitative indicators for high-risk/high-reward research. OECD Science, Technology and Industry Working Papers, No. 2021/07. Paris, France: OED Publishing. Retrieved from https://doi.org/10.1787/675cbef6-en
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