• Chairman’s Report
• The NIWA Executive
• Chief Executive’s Report
• The NIWA Board of Directors
• Financial Highlights
• NIWA’s Social and Environmental Contribution

Chairman’s Report

NIWA has produced a record financial result of $8.001 million before tax in the year to 30 June 2000. This has resulted in a net surplus of $5.326 million, an increase of 13.5% over the previous year. The overall return on average shareholders’ funds was 10.9%, which is ahead of NIWA’s weighted average cost of capital. Commercial revenues have grown strongly, and made a major contribution to this year’s record performances. Our strong financial performance allows us to continue to reinvest in NIWA’s science and ensure that we remain in the forefront of our field.

This past year has seen the establishment of NIWA in the United States in partnership with several leading US science institutions. This move can only serve to strengthen NIWA’s position as a world-class New Zealand-based environmental research institute. We now have a very significant relationship with New Zealand’s tertiary sector with the newly established postgraduate Institute for Aquatic and Atmospheric Sciences in partnership with the University of Auckland. The first students are being enrolled in the 2000 academic year.

Our efforts over the past 5 years to turn the research vessel operations into a successful venture have borne fruit. Tangaroa has been heavily committed, with survey voyages for Land Information New Zealand, as part of the project to define New Zealand’s Continental Shelf boundaries, and a historic first voyage to Antarctica under contract to the Antarctic Division of Environment Australia.

We have provided real benefits to New Zealand through our Public Good Science Fund (PGSF) programmes in the past year and have successfully renegotiated our science portfolios for 2000–01 with the Foundation for Research, Science & Technology in line with target outcomes identified through the Foresight process. Non-Specific Output Funding (NSOF), which provides funding equivalent to 10% of the value of contracts won through the Public Good Science Fund in the previous year, continues to be of great importance in allowing NIWA to pursue valuable science initiatives for the benefit of New Zealand.

NIWA today combines the best attributes of a world-class environmental research institute with the ability to deliver a wide range of high quality services and solutions to both public sector and commercial clients.

Don Sollitt
Chairman

August 2000

The NIWA Executive

Bryce Cooper, Rod East, Rick Pridmore, Rob Murdoch (standing)
Dene Biddlecombe, Paul Hargreaves, John McKoy (seated)
Clive Howard-Williams (at right)

Chief Executive’s Report

Financial performance

NIWA has achieved a group operating surplus before tax of $8.001 million in the year to 30 June 2000, against $7.037 million in the previous year, an increase of 13.7%. Net surplus was $5.326 million ($4.693 million in 1999). Gross revenue from research, consulting, and all other business activities was $71.556 million ($65.139 million), an increase of 10%. A further $970,000 has been transferred to the Research Vessel Replacement Reserve from net surplus in accordance with the Board’s policy, building this reserve to $4.850 million. Shareholders’ funds at 30 June 2000 were $51.675 million ($46.349 million), an increase of 11.5%, while total assets stood at $64.413 million ($57.772 million). NIWA’s after-tax return on average shareholders’ equity was 10.9%.

This year’s record achievement came through increases in commercial revenues from a variety of sources which more than offset a reduction in Ministry of Fisheries revenues against the Business Plan, while Public Good Science Fund revenue remained steady against budget. Costs continue to be well controlled through a very effective project management system.

In accordance with a commitment made to the shareholders in last year’s Business Plan, the Board commissioned a valuation of NIWA. This was undertaken by PricewaterhouseCoopers as at 29 February 2000, and assessed the commercial value of the Crown’s 100% equity in NIWA at $54.645 million.

Public Good Science Fund

The Public Good Science Fund (PGSF) remains fundamental to NIWA’s success as an environmental research institute. In this past year PGSF revenues have made up 51.7% of our total revenues. Our PGSF research forms the basis of the skills and knowledge we use to address environmental issues for central and local government agencies and authorities, industry, iwi, and many others throughout New Zealand.

NIWA successfully completed its 1998–2000 PGSF research contracts at the end of June 2000, and our researchers have produced outstanding science over this period. They have identified promising new resources and provided new knowledge and discoveries that significantly enhance New Zealand’s ability to generate wealth from its atmospheric and aquatic resources and sustainably manage those resources. Major achievements included:

• successfully rearing the eggs of kingfish, packhorse lobster, and turbot through the larval stages to juveniles for the first time in New Zealand, thereby establishing the potential of these species for aquaculture
• identifying three species of marine sponge suitable for providing a commercial supply of natural bath sponges, and undertaking initial culture trials with industry
• implementing a new model which successfully produces hourly predictions of air pollution levels over the entire city areas of Christchurch and Auckland
• developing models to provide the public with seasonal forecasts of atmospheric ozone and clear-sky UV levels, and finding evidence which links ozone depletion with global warming
• constructing new tools to assess the atmospheric and climate implications of different policy options for meeting commitments under the Kyoto Protocol
• constructing a system to predict river flood events up to 48 hours in advance, by combining catchment runoff and weather forecast models
• developing criteria to guide management of suspended sediment levels in streams to ensure that native fish migrations are sustained
• developing guidelines for regional councils on how to manage river flow regimes to reduce the frequency of algal blooms
• developing and trialling new advanced pond systems which significantly improve the treatment of wastewater from dairy farming activities
• establishing collaborative experiments with iwi to restore karengo (seaweed) beds, and to measure the growth and survival of paua transplanted by customary methods
• increasing the catch efficiency of the tuna longline fishery by developing daily satellite-derived imagery to help identify ocean regions where fish aggregate
• providing the first estimates of the mussel farm carrying capacity of coastal embayments in New Zealand; these results are being used to guide the resource consent and marine farm permit process for new marine farming sites in the Marlborough Sounds
• collating information on the resources of over 800 seamounts in the New Zealand region, and identifying seamounts which may be suitable for marine reserves
• discovering a 600 km extension to the deepsea Hikurangi Channel, which carries sediments eroded from the Southern Alps to the Pacific Basin, and, at a total length of more than 2000 km, is one the world’s longest active deepsea channels.

A portfolio-based investment process was introduced this year by the Foundation for Research, Science & Technology. Under this process we have developed research portfolios around the target outcomes identified through the Foresight process. These outcomes identify the future vision and direction of New Zealand in terms of innovation and economic, environmental, and social goals. We have welcomed the opportunity to show how our research will contribute to these outcomes and provide maximum benefit to New Zealand. We have made considerable advances in the integration of studies which will identify how human beliefs, behaviours, and actions influence the outcomes of our research. We are committed to working with and undertaking research for the benefit of Māori, and have developed Memoranda of Understanding with iwi to support these relationships, as outlined below.

There has also been a major restructuring of the PGSF and its management by the Foundation. Most public good science undertaken by NIWA now falls within a single Output Class which encompasses all environmental research. Funding for environmental research was essentially unchanged in the last budget. There has been significant growth in NIWA’s PGSF revenues over past years, but these revenues will not grow next year. The lack of additional funding, and the uncertainty associated with the way the Foundation will manage science investment in the future, severely affect planning, security, and stability in the science sector. The year ahead is likely to be a challenging one for NIWA.

Non-Specific Output Funding

NIWA was allocated $3.514 million of NSOF (exclusive of GST) in the 1999–2000 year. NSOF is used in NIWA principally to develop new public good research programmes in response to end-user demands (e.g., on the sustainability of whitebait fisheries, kingfish and seahorse aquaculture, and marine natural products), to support new or developing public good research programmes which have received insufficient funds to achieve desired outcomes, to fund "high risk" strategic research, and to respond rapidly to environmental issues important to New Zealand (e.g., the impact and spread of toxic algae; forecasting flood, drought, and climate hazards; quantification of greenhouse gas emission rates; rehabilitation of urban streams; tsunami hazard assessment; identification of diseases and parasites affecting fish and shellfish health).

During the 1999–2000 year, 11 international experts were given research grants to fill important skill and knowledge needs in New Zealand, covering such areas as:

• management strategies for shoreline development
• habitat requirements of marine fish
• development of improved natural systems for wastewater treatment
• food-web dynamics in our ocean waters
• modelling ozone depletion over New Zealand
• assessment of the stock structure of important new fisheries, such as toothfish
• modelling pollution runoff from rural catchments.

Our 1999–2000 postdoctoral fellowship programme assisted 20 young scientists in developing careers in New Zealand. Like our visiting scientists, they bring skills and recently developed insights which are essential to solve many of the complex environmental issues we are asked to address. Most of our past postdoctoral fellows have become permanent staff. Our new recruits are contributing to such important research areas as freshwater and marine biodiversity, weather and climate forecasting, marine aquaculture, urban air quality modelling, improved satellite technology, and the effects of UV radiation on aquatic ecosystems.

For our permanent staff, NSOF has become their lifeline to strategic science. Most of our public good research programmes have been steered towards low-to-moderate risk, highly achievable research targets, with few strategic science frills. This trend has been exacerbated by the increasing sums of money being directed towards technology/information transfer within established public good research programmes, which have often received little or no increase in funds over the last 5 years. Without a relatively large component (about 40%) of our NSOF being used for "high risk" strategic research and associated technique development, the basis for future breakthroughs in PGSF science would be greatly weakened.

National Climate Centre

In early 1999, NIWA launched the National Climate Centre, which has now become firmly established. This initiative represents a major step forward in the public dissemination of climate information. Each month, monthly climate summaries and 3-monthly outlooks for New Zealand air temperatures, rainfalls, soil moisture levels, and river flows are released through our newsletter The Climate Update, the National Climate Centre web pages, and television reports. In addition, experts from the National Climate Centre travel throughout the country giving talks to groups of farmers, local government officials, horticulturalists, ski industry representatives, and others, so that they may be better informed about how variations in climate could affect activities in their region. During the 1999–2000 year, more than 50 public talks were presented, as well as numerous briefings to government officials.

A new initiative this year has been the "GrowOtago" project, in partnership with the Otago Regional Council, to provide detailed climate and soil mapping of the whole of the Otago region. This innovative project will use satellite data and advanced computer modelling techniques to produce a series of maps showing the averages, ranges, and extremes of climate in the region to assist in identifying new options for agriculture, horticulture, viticulture, aquaculture, tourism, and forestry. GrowOtago has been strongly endorsed by the Otago Growth Coordinating Group, whose membership includes the Dunedin City Council; Waitaki, Central Otago, and Clutha District Councils; and the Otago Regional Council. NIWA and AgResearch are preparing the data and maps, and pilot projects started this year in downland areas. The rest of the region will be mapped over the next 2 years.

Fisheries

Research commissioned by the Ministry of Fisheries in the past year has extended more into areas associated with the environmental principles in the Fisheries Act. NIWA has been well placed to provide services in this area, and several of the studies we carried out in 1999–2000 are well integrated with PGSF programmes. We have carried out projects on improving understanding of the bycatch (including marine mammals and birds) in several fisheries, and the effects of fishing on benthic habitats, including seamounts.

Core fisheries research has continued at a relatively constant level, and NIWA has maintained an approximately 90% share of the research tendered by the Ministry of Fisheries. Total revenue from this source in 1999–2000 was $11.343 million, compared with $11.777 million in 1998–99. In addition, many projects carried out by other providers contain significant NIWA input as partners or subcontractors.

Although the Minister of Fisheries has decided to review the proposed direct purchasing arrangements, stakeholder groups can still commission research into sustainability. Further developments are taking place in our relationships with the fishing industry and other fisheries stakeholders. We carried out several projects, identified by the Ministry of Fisheries as required services, by way of direct purchase by industry groups in 1999. In addition, we are increasingly being directly contracted by stakeholder groups to carry out other fisheries research tasks. These groups include the Orange Roughy Management Company, the ORH1 Exploratory Fishing Company, the Hoki Fishery Management Company, the Paua Management Company, the Bluff Oyster Management Company, the Rock Lobster Industry Council, and the Challenger Scallop Enhancement Company.

The process of research planning and tendering has increased in complexity, and decisions on many projects have been delayed to the point where significant problems with resource planning are now being faced by research providers such as NIWA, particularly with staff and vessel commitments. We also remain concerned that much of New Zealand’s fisheries research is carried out in a context that is not well linked to a good fisheries management framework. Progress in the development of Fisheries Plans is slow and seems to have been limited by resources within the Ministry of Fisheries. However, the recognition by a number of stakeholders that fisheries management is more than just the quota management system is likely to lead to greater progress.

Strategic capital investment

NIWA has maintained its commitment for the sixth successive year to invest significantly in strategic assets to advance our atmospheric and aquatic sciences. This year state-of-the-art oceanographic survey equipment and a high resolution Fourier Transform Spectrometer were purchased. The oceanographic survey equipment was essential to conduct work required by New Zealand as part of the United Nations Convention on the Law of the Sea. The spectrometer was needed to maintain our high international profile in ozone research. A high resolution Fourier Transform Spectrometer has been in permanent operation at our Lauder (Central Otago) research station since 1989. The instrument has been essential in establishing New Zealand’s significant international reputation in the field of ozone depletion research, and it is a critical component of NIWA’s role in the International Network for the Detection of Stratospheric Change. Over the last decade, the instrument has helped our atmospheric scientists attract some $3 million of investment from several important science institutions in the Netherlands, the US, and Japan, and has helped draw many leaders of stratospheric research to New Zealand. As with most scientific equipment, technology marches on, and the instrument has been replaced by a new state-of-the-art spectrometer, which we hope will keep us at the forefront of ozone depletion research for years to come.

Institute of Aquatic and Atmospheric Sciences

In November 1998, NIWA entered into an agreement with the University of Auckland to establish the Institute of Aquatic and Atmospheric Sciences. The purpose of this joint initiative is to produce MSc and PhD graduates with a range of multidisciplinary skills who are needed to fill present and future job opportunities in the aquatic and atmospheric sciences. The Institute has its own Board of Studies and is linked to the University’s Schools of Biological Sciences, Engineering, Geography, and Environmental and Marine Sciences, and the Departments of Geography, Geology, Mathematics, and Physics.

The Institute covers a diverse range of research areas, including atmospheric chemistry, meteorology, climatology, oceanography, fisheries science and management, freshwater ecology, hydrology, hydraulics, coastal and estuarine marine science, ecotoxicology, marine and freshwater taxonomy, and aquaculture. It is the first formal association between a university and a Crown Research Institute in New Zealand to offer such an extensive postgraduate programme. By combining the University of Auckland learning facilities, NIWA’s research capabilities, and the expertise of the two organisations, we intend that IAAS will become an internationally recognised postgraduate teaching institution which will attract top students from New Zealand and overseas.

To date, 10 PhD students have enrolled in the Institute, and they have received study grants from a diverse array of funds (e.g., Tuapapa Putaio Māori Scholarships, FRST Top Achiever Awards, Commonwealth Scholarships, Auckland Uniservices Grants, NIWA Scholarships). In addition, MSc and ME degrees in Atmospheric Science, Fisheries Science, Freshwater Science, and Marine Sciences have been formulated. The first enrolment of MSc and ME students will begin in the 2000–01 academic year.

Commercial revenues

NIWA’s commercial science revenue, from sources other than the Public Good Science Fund and the Ministry of Fisheries, has grown by more than 50% from $10.5 million at inception in 1992–93 to $18.0 million (excluding vessel charter operations) in 1999–2000. Revenue from this source increased by 8.2% over that in the previous year. Revenue from all sources, excluding the Public Good Science Fund and Ministry of Fisheries, now makes up 32.4% of NIWA’s total revenue.

In our commercial science work we focus strongly on delivering comprehensive solutions to environmental problems. The keys to our success in increasing these revenues in New Zealand continue to be: developing quality client support services, building close relationships with our major clients, and identifying and packaging new services and products to improve New Zealand’s capability for the sustainable management and development of aquatic and atmospheric resources, which, in some instances (e.g., aquaculture and biotechnology) can lead to significant wealth creation. Over recent years NIWA has developed a range of high quality client focused newsletters and participated in selected trade shows. Beyond all, however, we place great emphasis on making sure that we deliver our contracted outputs on time and within budget. The major clients for our commercial work are the hydroelectric energy industry, regional councils, and the Government (policy and operational work for bodies such as Land Information New Zealand).

International development

Our earlier decision to develop opportunities for aquatic and atmospheric research in the United States has been driven by the fact that although NIWA has achieved a high level of dominance in our New Zealand markets, and we are confident we will maintain our share of these markets, they are unlikely to grow as rapidly during the next 5 years as they have since 1995. In addition, the Government’s funding commitment to environmental science goals within the Public Good Science Fund has levelled off for the time being. Continued growth is essential for NIWA to maintain and enhance its science teams and its success as a world class research business. We needed to establish a subsidiary company in the US to operate there and to secure appropriate work visas for NIWA staff who will be undertaking project work in the US.

Our entry into the US is consistent with our earlier strategic decision to stay close to our core business in atmospheric and aquatic science and consultancy, and our commitment to undertake science for the benefit of New Zealand. Expansion into the US market will provide our New Zealand-based staff with the opportunity to work in the US for part of their time and, eventually, US-based staff the opportunity to work in New Zealand. These linkages will enable fresh knowledge to be brought to bear on a range of environmental issues facing New Zealand, assist in recruiting staff, and ensure that NIWA develops as a world-class research institute.

We have formed a New Zealand-based US executive management group which incorporates members of our existing senior management team with several senior scientists to drive the US initiative. On advice from our US partners we have taken the further step of forming a US-based "not for profit" entity to be known as the NIWA Environmental Research Institute. This will be used to undertake work in the publicly funded science area. A Board of Directors has been constituted, chaired by NIWA New Zealand chairman Don Sollitt and including two of our US science partners, Professor Robert Ward from Colorado State University and Professor Robert Whitlatch from the University of Connecticut. Members of the NIWA (USA) executive team have been visiting the US to develop project opportunities with potential US partners.

Together with our initial US partners, the University of Connecticut Marine Sciences Department, the Virginia Institute of Marine Sciences, the Smithsonian Environmental Research Center, and Colorado State University, we also have strong relationships with several other major US research organisations. These include Washington State University, Department of Energy (Los Alamos and Oak Ridge), National Center for Atmospheric Research, Wright State University, US Geological Survey (Columbia, Corpus Christie, and Denver), Tufts University, NASA Langley Research Center, Scripps Institution of Oceanography, and NOAA Climate and Diagnostics Laboratory.

At the same time we have identified several North American consultancy firms which have suitable complementary skills to NIWA and are interested in developing a business relationship with us. We will use these business partnerships to gain environmental consultancy work in the US. Our whole approach to developing our US operation is to proceed gradually in a measured way and build to a point over the next 3 years where our US business is making a valuable contribution to our overall financial performance and is insulating us against the limitations of the New Zealand market.

Research vessel operations

Our research vessel operations were established on a commercial basis in 1995 when we acquired the research vessels Tangaroa (deep water) and Kaharoa (inshore and coastal). Ownership of these vessels was placed in a wholly owned subsidiary company, NIWA Vessel Management Ltd, and the initial sources of revenue were derived solely from NIWA’s own ocean science programmes funded through the Public Good Science Fund and Ministry of Fisheries contracts for fisheries stock assessment. Since then, through NIWA Science, we have developed a variety of opportunities for science-based voyages. The past year has been particularly successful, and has seen the fruition of a long-term project with Land Information New Zealand (LINZ) to undertake the seabed surveys necessary to support New Zealand’s extended claim to its Continental Shelf under the United Nations Convention on the Law of the Sea. This claim has to be submitted by 2006.

The first such survey, using Tangaroa, was undertaken over 40 days in the northwestern region in September-October 1999. Its success was followed by the commission of the second survey for the southern and western regions over a period of 31 days in May-June 2000.

In February-March Tangaroa made its first voyage to the Antarctic Continent under a charter for the Antarctic Division of Environment Australia. This voyage, which was part of the Australia Antarctic Programme, carried Australian and Italian scientists to gather sediment cores and seismic profiles to determine the history of the Antarctic continental Slope off the Wilkes Land coast. To undertake the voyage Tangaroa was fitted with heavier, hardened propeller blades suitable for ice encounters. The ship spent over 5 weeks at sea and worked in ice conditions close to the coast, near the Mertz Glacier tongue, successfully demonstrating its capability to operate in Antarctic conditions. We are planning further Antarctic voyages with New Zealand and other partners.

During this voyage NIWA accepted responsibility from the Ministry of Foreign Affairs and Trade to act as CCAMLR (Commission for the Conservation of Antarctic Marine Living Resources) Inspectors as part of the surveillance of illegal toothfish fishing in the Southern Ocean.

In May-June we were commissioned by LINZ to undertake a hydrographic survey off the Three Kings Islands, northwest of North Cape. Kaharoa was a support vessel for this project, which was successfully undertaken in difficult conditions.

Although the research vessels have been part of NIWA since 1995, it has been a long and difficult process to develop their use to an acceptable level. We have now reached that point, though it is a continuing challenge to sustain a high level of use. However, as a result of our endeavours we have become better known internationally and are beginning to find opportunities in Australia and beyond.

Our "Sea and Learn" programme on Kaharoa, aimed at providing a free marine education programme for sixth and seventh form students, got off to a successful start in September 1999. In the initial programme, up to 12 students at a time from 19 schools joined Kaharoa for single day cruises from North Island ports. In the 2000–01 year the programme will operate from South Island ports and will incorporate a 5 day programme sponsored by the Treaty of Waitangi Fisheries Commission (Te Ohu Kai Moana) for Māori students. A Royal Society Teacher Fellow, Graham Foster, is committed to work with the Sea and Learn programme in the provision of resources and background material for participating teachers.

Working with Māori

NIWA places strong emphasis on establishing effective relationships with Māori. This arises from the fundamental importance to Māori of NIWA’s core business of the sustainable management and development of freshwater, coastal, and marine resources.

Our objectives have been:

• to identify key areas of NIWA’s work of relevance to Māori, in consultation with tribal groups throughout the country
• to develop joint programmes in collaboration with iwi, which will enable NIWA to provide appropriate and relevant science for different iwi/hapu, promote sharing of skills, and encourage shared responsibility for change
• to increase the number of Māori participating and achieving in science, mathematics, and technology
• in consultation with iwi, to develop and implement a policy on relationships, responsibilities, and consultation with Māori, and to educate NIWA staff on this policy.

Since April 1997, NIWA’s Manager, Māori Development, Dean Grace (Tuwharetoa, Tainui) and Dr Bryce Cooper, Director (Business Development) have been responsible for leading the development of a network with iwi throughout New Zealand to facilitate and promote NIWA-iwi interactions. A key aspect of this development has been the establishment of links between NIWA’s relevant research teams and tribal groups who want to use NIWA’s expertise to enhance their exercise of kaitiakitanga or to develop new economic opportunities. To support the establishment of these links the Manager, Māori Development has developed and implemented Māori cultural training programmes in NIWA to ensure staff understand the importance of maintaining cultural integrity when working with Māori by developing an appreciation of kawa and the concepts of kaitiakitanga, manamoana, and waahi tapu. NIWA’s partnership activities with Māori are now many and varied, ranging from studies on eel migration through to new aquaculture opportunities.

To add further impetus to our initiatives, a NIWA Māori Research and Development Unit has been established. The Unit’s main aim will be to provide a research and development capability with a strong Māori perspective. The nucleus of this team will consist of Māori staff employed by NIWA over the last few years. A former Tuapapa-FRST Putaiao Postgraduate Fellow, Sean Ogilvie (Te Arawa, Mataatua), was appointed in late 1999 as the lead scientist of this unit.

A highlight of this past year was the signing of a Heads of Agreement with Ngati Tuwharetoa. This ceremony took place at our Hamilton site and we were honoured to host Paramount Chief Tumu Te Heuheu and other members of the Tuwharetoa Māori Trust Board. NIWA has Memoranda of Understanding with many iwi throughout the country, and these memoranda are the basis for active relationships which lead to the sharing of scientific knowledge and matauranga Māori.

Staff and management

Of NIWA’s 571 permanent staff, 462 people (82%) are committed to our research teams and research support, including 38 in the research vessel operations. Since its inception in 1992, NIWA has been a consistent hirer of staff, and has created over 80 new positions, exclusive of the fisheries staff who joined in 1995. NIWA is finding it increasingly difficult to attract high quality young scientists, and this is exacerbated by New Zealand’s relatively low salary structure and the exchange rate of the New Zealand dollar. Failure to attract enough well qualified staff is a major risk to our medium and long-term future.

In late 1999 we recognised that, for the first time since the establishment of the "One NIWA" structure 5 years earlier, the growing scale and complexity of our business required an extension of our core executive management group. New positions of Director (Research Development), with responsibility for developing a strategic overview of NIWA’s PGSF science and its future directions, and Director (Business Development), with responsibility for developing the strategic overview of our New Zealand-based commercial work and its future direction, were established. These positions were taken by Dr Rob Murdoch, previously a Regional Manager in Wellington, and Dr Bryce Cooper, formerly Regional Manager in Hamilton. An additional part-time executive position, Director (Educational Programmes) was created, and Dr Clive Howard-Williams, who continues as NIWA’s Regional Manager in Christchurch, was appointed.

Under the new arrangement Dr Rick Pridmore has been appointed to the position of Deputy Chief Executive (Strategic Development) and Dr Rod East to the position of Deputy Chief Executive (Operations). The expanded NIWA Executive now includes these individuals with myself as Chief Executive, Dr John McKoy, who remains Director (Fisheries Research), and Dene Biddlecombe, General Manager – Finance. New Regional Manager appointments were subsequently made from existing NIWA staff. We are now confident that we have a top class management team in place to address the challenges that lie ahead. We have shown, moreover, the strength of promoting people from within NIWA.

In September 1999 we participated in a staff climate survey with nine other research organisations, including seven CRIs. This provided us with a basis for comparison with an earlier survey undertaken in 1996 [see "Staff attitudes"]. The results show a quite outstanding position for NIWA, placing us substantially ahead of the other participating organisations on most indicators. This is a strong endorsement of the strategies and policies we have followed at NIWA since the original management changes and the creation of "One NIWA" in late 1994. NIWA management places particular importance on the issue of staff morale. We believe that if a research organisation cannot get this right, it will inevitably be reflected in the overall performance and health of the organisation.

NIWA management believes strongly that a quality organisation cannot be built unless there is a full commitment and "buy in" by the staff. A measure of the success of our strategies was shown in this past year by the invitation of the New Zealand Quality Foundation to Dr Rod East to speak on NIWA’s achievements at their "Knowledge Hours" presentations. These were run jointly with the New Zealand Institute of Management in Auckland, Wellington, and Hamilton, and the topic was "Building a united organisation focused on projecting a single vision". Over 180 people from a wide variety of organisations throughout New Zealand attended these functions, and we received a very positive response to the NIWA story.

The strong profit achievement this year over last year’s previous record comes about through the efforts and endeavours of a great many people. NIWA has had a profit share scheme in place since 1995 which has provided recognition for all staff for this year’s achievement. I would like to acknowledge everybody’s efforts in contributing to this very successful year.

Paul Hargreaves
Chief Executive

The NIWA Board of Directors

Brian Rhoades, Don Thompson, John Montgomery, Paul Morgan, Don Sollitt, Alex Laing

Financial Highlights

NIWA’s Social and Environmental Contribution

NIWA’s research and related services are focused strongly on working for the benefit of New Zealand. In 1999–2000 the services provided by NIWA included $37.0 million to the Foundation for Research, Science & Technology, $11.3 million to the Ministry of Fisheries, $20.6 million to other New Zealand purchasers, and $2.6 million (3.6% of total) to purchasers outside New Zealand.

New Zealand’s international obligations

NIWA’s expertise is made available to various Government departments to provide policy advice and meet New Zealand’s obligations to international conventions to which this country is a signatory. Examples include provision by NIWA of:

• New Zealand’s Coordinator for Science and Technology Agreements between New Zealand and the Federal Republic of Germany
• Vice-President of the World Meteorological Organization’s Commission for Agricultural Meteorology
• Personnel to assist in the selection of potential environmental indicators in association with the Ministry for the Environment
• Convening Lead Authors and Lead Authors and Reviewers of chapters of the Third Assessment Report of the Intergovernmental Panel on Climate Change (IPCC)
• The IPCC Bureau Working Group II Vice-Chair for World Meteorological Organization Region V, whose role is to help coordinate and disseminate climate change information relevant to the southwest Pacific and to provide the scientific backdrop against which domestic and, in particular, international climate change policy is developed
• Personnel to assist Chile in the management of their whitebait fishery and the development of technology for whitebait aquaculture
• New Zealand’s Representative at the United Nations Environment Programme meeting on "Effects of Ozone Depletion on the Environment"
• Convenor of the Royal Society of New Zealand Climate Committee, whose responsibility is to advise Government and the general public on climate issues
• Co-Chair of the IGBP Global Atmospheric Methane Synthesis project
• New Zealand’s Representative to the Joint Global Ocean Flux Study (JGOFS)
• Personnel to supply advice on climate issues to the New Zealand Permanent Representative to the World Meteorological Organization
• Two members of the National Science Strategy Committee on Climate Change, whose responsibility is to advise Government on national research needs and progress
• Chairman and Secretary of New Zealand’s National Commission for the UNESCO International Hydrological Programme
• New Zealand’s Representative to the IGBP Ecosystem Dynamics (Globec) Programme
• Vice-President of the International Ozone Commission of the International Union of Geodesy and Geophysics
• New Zealand’s Hydrological Advisor to the Permanent Representative of the World Meteorological Organization
• Chair of the Regional Steering Committee for UNESCO’s International Hydrological Programme for SE Asia and the Pacific
• Member of the New Zealand Science Sub-Commission for UNESCO
• Delegate to the IUCN Scientific Committee on Antarctic Research
• Designated "Expert on Hydrological Design" for the World Meteorological Organization’s Commission for Hydrology
• Personnel to supply advice on hazard mitigation to the New Zealand Civil Defence

In some of the above examples, travel and some other costs for NIWA staff have been met from sources such as the International Science and Technology Linkages Programme administered by the Ministry of Research, Science & Technology, but NIWA has borne the additional costs involved in report writing and provision of policy advice to the Crown. Our records of staff time show that the total cost of such activities to NIWA in 1999–2000 was more than $400,000. This is a cost which NIWA willingly bears to ensure that the best advice is available to the Crown on these key scientific and technical issues.

NIWA staff routinely contribute to various inter-governmental treaties, processes, and agreements; for example:

• Montreal Protocol on substances which deplete the ozone layer
• United Nations Framework Convention on Climate Change
• Kyoto Protocol
• Vienna Convention for the Protection of the Ozone Layer
• United Nations Convention on Biological Diversity
• Commission for the Conservation of Antarctic Marine Living Resources
• Antarctic Treaty
• Madrid Protocol to the Antarctic Treaty
• United Nations Convention on Law of the Sea

Research output

NIWA’s research output for 1999 included 313 papers in international, externally refereed, scientific journals, series, or books; 170 papers in local, internally or editor-refereed journals, series, or books; 520 conference papers and abstracts; 88 research monographs or books; and 507 scientific and technical reports. Full details of these publications are published separately.

Application and promotion of science

In the 1999–2000 financial year, NIWA supplied information to New Zealand users (excluding the Foundation for Research, Science & Technology and the Ministry of Fisheries) through consultancies and contracts to the value of $20.6 million. In addition, we achieved 100% of the technology transfer objectives in our PGSF contracts during this period and conducted seven TBG contracts to the value of $340,000 and TechNet/TechLink contracts valued at $120,000. The availability to end-users and degree of use of NIWA’s three Nationally Significant Databases continued at similar or higher levels than in previous years. We serviced over 4000 requests for information from the National Climate Database (which also has 120 registered online users), more than 500 requests for information from the Water Resources Archive, and more than 300 requests for information from the New Zealand Freshwater Fisheries Database (which went online this year and has 17 subscribers). During 1999, 102 magazine and newspaper feature articles written by NIWA staff were published. NIWA staff made 8 science-related television appearances and were involved in 16 radio interviews during the year.

Education

NIWA is strongly committed to the advancement of science education and knowledge. Our commitment is aimed at schools and universities, and in some cases to the wider public. The school sponsorship programme currently targets three areas: Sea and Learn programme, regional science fairs, and Kelly Tarlton's Discovery Room.

• The Sea and Learn programme, referred to in the Chief Executive’s Report, was initiated by NIWA in September 1999. Using its own resources, NIWA provided pupils from 19 North Island schools each with a 1-day hands-on science voyage on our coastal research vessel Kaharoa. The teaching resource for the programme was developed jointly by NIWA scientists and school science teachers and is linked to the N.Z. science curriculum. The 2000 Sea and Learn programme will be run from South Island ports and has attracted wide enthusiasm from schools. The teacher on board is supported by a Royal Society Science, Mathematics and Technology Fellowship.
• NIWA sponsors the Auckland City, Waikato, Bay of Plenty, and Wellington Regional Science Fairs, and provides additional sponsorship of the Central Northland, North Harbour, Taranaki, Nelson, Marlborough, Central South Island, South Canterbury, and Otago Regional Science Fairs. These sponsorships promote science in secondary and intermediate schools and to the community at large. NIWA science staff contribute to judging at these fairs and are consistently impressed by the high standard and innovation that the fairs produce.
• In 1999, NIWA also sponsored the establishment of the marine educational facility at Kelly Tarlton’s Underwater World in Auckland. The NIWA "Discovery Room" is aimed largely at primary and intermediate age children. It provides interactive marine science in varied formats, such as a touch pool, hands-on experiments, and life under the microscope.
• NIWA has continued to strengthen and expand links with New Zealand universities. The postgraduate Centres of Excellence with four universities continue to operate successfully, and the joint NIWA-University of Auckland Institute of Aquatic and Atmospheric Sciences has been successfully established, taking on its first postgraduate students in the 2000 academic year (see the outline in the Chief Executive's Report). NIWA staff have acted in a supervisory role for over 80 postgraduate students across six universities in the last year, and we currently provide eight NIWA PhD scholarships in skill areas that we have identified as priorities for the future. These cover a wide range of topics, including coastal ecology, greenhouse gas production, and the ecology of eels linked to Māori cultural values.
• NIWA's publications are directed at education of the wider public. Our flagship publication, Water and Atmosphere, is distributed to schools, local bodies, and a wide range of other institutions across the country. We also produce a range of specialist publications, such as Aniwaniwa, Aquaculture Update, Biodiversity Update, and Climate Update, which are more industry-focussed. Climate Update is associated with NIWA's National Climate Centre.

Staff resources

Staff numbers, turnover, and age composition

Age breakdown (%) by 10-year age groups

Good employer

NIWA has put in place a performance management system and remuneration policy which pays for the range, depth, and type of skills of our staff, recognises an individual’s worth to NIWA and the value of each staff member’s contribution, and allows for career development of staff. We also provide superannuation and life insurance schemes for staff. NIWA has implemented a comprehensive Health and Safety Plan, which has met the requirements of all site inspections by the Occupational Health Service of the Department of Labour. The number of work-related accidents in 1999–2000 was 91, of which 7 required staff to take time off work. These are again slightly below the levels of the previous year. The number of days lost because of work-related accidents in 1999–2000 was also lower than in the previous year and represented a very low proportion of total working days (less than 0.02%). Our Human Resources Policy and Procedures Manual, which was developed and is added to as required by a Staff Working Group, addresses a wide variety of issues from Staff Training and Equal Employment Opportunity to Recruitment and Remuneration. This Manual is available online to all staff. Retention of key staff through facilitation of effective science is a major objective of NIWA’s management. This includes such aspects as a strong capital investment programme to purchase state-of-the-art science equipment, a project management system which gives staff the opportunity to lead and direct research projects with a high level of responsibility for scientific and financial performance, and a substantial overseas travel programme for staff. In addition, we operate Technical Training and Sabbatical Awards for staff and a Visiting Scientist Programme.

Copies of full NIWA Annual Reports are available at the main public libraries and from:

NIWA
Private Bag 99940
Newmarket
Auckland