Corporate Europe Observatory

Exposing the power of corporate lobbying in the EU

Corporate world has too much power over R&D funding

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The wrong type of research projects are being prioritised by EU officials, handing out funding, claims Corporate Europe Observatory

Comment piece published in Public Service Europe on December 8 2011.

On November 30, the European Commission published its legislative proposal for the EU's new Research Framework Program for 2014-2020, named Horizon 2020, with a very substantial budget proposal of €80 billion. The Member States and the European Parliament are now going to discuss and negotiate the final version. Corporate lobby groups started working on this long ago: the European Roundtable of Industrialists (ERT), for instance, published its own position paper in October 2010, unsurprisingly pushing for the EU's research budget to be more closely aligned with industrial innovation needs.

Large industrial groups obviously prefer using the EU's research money to finance their R&D projects when they can, rather than their own funds. Our report on the corporate capture EU research funding: for who's benefit? shows how global steel giant Arcelor Mittal secured funds from the FP7 budget for research on CO2 emissions reduction technologies, even though it already benefits from massive carbon-related subsidies for the same purpose; in the form of emission allowances given to it for free under the EU Emissions Trading Scheme. The company did not pay a single euro in tax, in Belgium, in 2010. But the pressure to increase "industrial relevance of EU research programmes" is not coming only from traditional corporate lobby groups: it also comes from some of the advisory bodies which the commission has been funding within its current research programme - FP7. The EU has financially supported the creation of industry-led groups, which gave large corporations a privileged conduit to influence the union's research priorities and funding decisions: the European technology platforms or ETPs and the joint technology initiatives JTIs.

Most ETPs started their work between 2004 and 2006, with the mission to define their requirements for R&D funding from private and public sources in a "strategic research agenda". This document was then submitted to the commission's Directorate-General for Research. These documents have not automatically led to awards of public money, but definitely contributed to shape the funding allocation. The sustainable chemistry ETP estimates it has "inspired projects that have attracted almost €800m of funding" in FP7. Another ETP, the biofuels technology platform is under investigation by the European Ombudsman following a complaint by Corporate Europe Observatory about the dominant role played by industry, and the very damaging influence it had on the biofuels research agenda.

JTIs could be described as ETPs which convinced the EU to directly participate in the implementation of their "strategic research agenda". But the power enjoyed by industry within JTIs is no longer limited to suggesting which research projects should be funded by the DG for Research. JTIs receive a direct and substantial public subsidy, making them – and, particularly, the "clean sky initiative" - the clearest example of research funds being used as industrial subsidies. The total tax payers' contribution to these initiatives for 2007-2013 is €3.14bn, provided in cash by the commission, whereas member corporations contribute similar amounts but "in-kind". These projects create habits of close collaboration between industry lobby groups and the commission's officials. A number of influential MEPs, too, have joined the bandwagon and become strong advocates of these projects - which have everything to do with technological development and industrial competitiveness, but much less with a broader understanding of society's research needs.

This comes from the flawed assumption that competitiveness and economic growth can solve all societal challenges. As an open letter sent to the EU institutions in June 2011 and signed by more than 100 civil society groups and research organisations stated, "Research agendas that prioritise profit and market share are incapable of meeting the social and environmental challenges Europe is facing precisely because these challenges require alternatives to the high-growth, high-profit models of economic development that have been pursued to such devastating excess. European research should promote and focus on innovation that provides solutions rather than investing in end of pipe technologies, which do not tackle the root causes of the problems that society faces." But the commission has probably not taken any of these concerns into account. Its new research framework programme proposal is not only business as usual, but suggests deepening the industry capture of research funding policy – it proposes to reserve more than €20bn for "activities where businesses set the agenda".

Martin Pigeon is a researcher at the Corporate Europe Observatory campaign group, in Brussels

Comment piece published in Public Service Europe on December 8 2011.On November 30, the European Commission published its legislative proposal for the EU's new Research Framework Program for 2014-2020, named Horizon 2020, with a very substantial budget proposal of €80 billion. The Member States and the European Parliament are now going to discuss and negotiate the final version. Corporate lobby groups started working on this long ago: the European Roundtable of Industrialists (ERT), for instance, published its own position paper in October 2010, unsurprisingly pushing for the EU's research budget to be more closely aligned with industrial innovation needs.Large industrial groups obviously prefer using the EU's research money to finance their R&D projects when they can, rather than their own funds. Our report on the corporate capture EU research funding: for who's benefit? shows how global steel giant Arcelor Mittal secured funds from the FP7 budget for research on CO2 emissions reduction technologies, even though it already benefits from massive carbon-related subsidies for the same purpose; in the form of emission allowances given to it for free under the EU Emissions Trading Scheme. The company did not pay a single euro in tax, in Belgium, in 2010. But the pressure to increase "industrial relevance of EU research programmes" is not coming only from traditional corporate lobby groups: it also comes from some of the advisory bodies which the commission has been funding within its current research programme - FP7. The EU has financially supported the creation of industry-led groups, which gave large corporations a privileged conduit to influence the union's research priorities and funding decisions: the European technology platforms or ETPs and the joint technology initiatives JTIs. Most ETPs started their work between 2004 and 2006, with the mission to define their requirements for R&D funding from private and public sources in a "strategic research agenda". This document was then submitted to the commission's Directorate-General for Research. These documents have not automatically led to awards of public money, but definitely contributed to shape the funding allocation. The sustainable chemistry ETP estimates it has "inspired projects that have attracted almost €800m of funding" in FP7. Another ETP, the biofuels technology platform is under investigation by the European Ombudsman following a complaint by Corporate Europe Observatory about the dominant role played by industry, and the very damaging influence it had on the biofuels research agenda.JTIs could be described as ETPs which convinced the EU to directly participate in the implementation of their "strategic research agenda". But the power enjoyed by industry within JTIs is no longer limited to suggesting which research projects should be funded by the DG for Research. JTIs receive a direct and substantial public subsidy, making them – and, particularly, the "clean sky initiative" - the clearest example of research funds being used as industrial subsidies. The total tax payers' contribution to these initiatives for 2007-2013 is €3.14bn, provided in cash by the commission, whereas member corporations contribute similar amounts but "in-kind". These projects create habits of close collaboration between industry lobby groups and the commission's officials. A number of influential MEPs, too, have joined the bandwagon and become strong advocates of these projects - which have everything to do with technological development and industrial competitiveness, but much less with a broader understanding of society's research needs.This comes from the flawed assumption that competitiveness and economic growth can solve all societal challenges. As an open letter sent to the EU institutions in June 2011 and signed by more than 100 civil society groups and research organisations stated, "Research agendas that prioritise profit and market share are incapable of meeting the social and environmental challenges Europe is facing precisely because these challenges require alternatives to the high-growth, high-profit models of economic development that have been pursued to such devastating excess. European research should promote and focus on innovation that provides solutions rather than investing in end of pipe technologies, which do not tackle the root causes of the problems that society faces." But the commission has probably not taken any of these concerns into account. Its new research framework programme proposal is not only business as usual, but suggests deepening the industry capture of research funding policy – it proposes to reserve more than €20bn for "activities where businesses set the agenda".Martin Pigeon is a researcher at the Corporate Europe Observatory campaign group, in Brussels
 
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