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24 March 2018 Speech

I would like to begin by acknowledging the Gadigal people of the Eora nation as the Traditional Owners of the land that we are on today, and pay my respect to their Elders past and present.

It's so important that we honour and learn from our past.

I've been leading the CSIRO for about two years now, and it's incredible to see how much has changed – and how much hasn't – since my days as a student at CSIRO in the 1980s.

Today we have about 1000 students at CSIRO across different programs, and I spent some time with about 200 of them at a recent PostDoc Conference.

What resonates for me today, as it did 30 years ago, is the generous way our elder scientists support these early career scientists, but also the way our new scientists re-energise and inspire our more established scientists.

We prioritise diversity at CSIRO in all its forms, but this diversity of experience really speaks to my own CSIRO story.

It strikes me that the relationship between early-career and established scientists at CSIRO is a lot like Australia's relationship with the US.

On the one hand, just as scientists do, our nations have very similar backgrounds and knowledge bases:

  • We both share rich heritages of indigenous knowledge, which informs our science today;
  • We are both relative newcomers to western traditions, only 400 years since the Mayflower and 200 years since the First Fleet; and
  • We also have a strong history of immigration fuelling our diverse nations.

Perhaps it's this cultural diversity without allegiance to any single set of traditions that makes it easier for our two nations to embrace innovation.

New ways of thinking and solving problems are free to compete on their merits, without histories of convention tying them down.

But on the other hand, like the difference in experience between the young scientist and the established one, the innovation ecosystems of Australia and the US are worlds apart:

  • While the US has funnelled the power of their science into world-leading entrepreneurial hubs like Silicon Valley, here in Australia our innovation often follows the same path as intrepid bright young people – it heads off overseas to achieve its potential.
  • Wifi is a classic example – invented here at CSIRO many decades ago, but bought by an American company to commercialise and reap the benefits overseas.

Australia must realise more economic benefit from its incredible science brainstrust – we have to change the way we send our innovation out into the world – not just as a raw material, but rather as a polished unique gem.

But the early-career scientist doesn't set out to mimic the legions of scientists who have gone before.

As Isaac Newton said, we stand on the shoulders of giants – we don't seek to start from where they stood.

We shouldn't set out to copy the US, but we should redefine our relationship with the innovation powerhouses of the world.

There is, in fact, a ripe opportunity here for both the early-career and the established scientists to benefit from each other's strengths.

So as I mentioned, a lot of Australia's brightest minds and greatest talents head off overseas in search of bigger challenges and like minds that think BIG.

I know this expat journey well, because in the late 80s I did what many young Australians did, and headed to the US in search of the new opportunities offered by a country 10 times our size.

It was at Stanford that I learned about the incredible power of science to effect deep and profound change when partnered with the lessons of business school.

I used those lessons to start my own career; and six start-ups, 20 boards and 26 years later, I wanted that same success for my home country.

I knew Australia was a world-leader in science and technology research, and if only we could work out a way to tap into that genius, we could create a new economic pillar with the value we'd unleash – not value dug from the ground but from our minds.

I looked around me in Silicon Valley and was inspired by the virtuous circles I saw around me, powered by the new value created by science.

Intel was the cornerstone of Silicon Valley, inventing the silicon chip to create the computer industry – incidentally, also turning a cheap commodity, sand, into a unique high value material.

That invention planted the seed for what would grow into a thriving innovation ecosystem, where the returns of investment into deep science and technology research are reinvested in new inventions, and so new value is created.

Those who made their first profits from Intel invested in the next generation of ideas, and so on until you could draw a line in Google Maps – once it was created – to physically mark out the innovation ecosystem.

In Australia, we don't have that ecosystem... not yet.

I wholeheartedly believe CSIRO is the seed that will germinate into that ecosystem.

We are the early-career scientists looking at the established scientists of the States thinking, gee, they've done well – but I bet we can learn from them and do even better.

By the same token, I think the US looks at our scientists, leaders in world-class research and bright with potential for global success, and sees an opportunity to reinvigorate and re-vitalise their now conventional, now predictable innovation ecosystem.

So what was it about this 100-year-old government agency that convinced me it was the key to Australia's future economic success?

Let me take you back through some of that history to explain.

In 1916, Prime Minister Billy Hughes announced the formation of a publicly-funded science agency.

Just like an early-career scientist, Billy had looked around him to see how more established nations were grappling with the challenges of the early 1900s, and he saw the successes of Germany in applying science to their challenges, both economic and military.

So he called CSIRO's predecessor into being, designed to solve challenges like:

  • How we grow our own food in a dry and arid climate;
  • How we harness the benefits of a wealth of untapped natural resources; and
  • How we build up industries so far from the rest of the world.

Perhaps unsurprisingly for Billy, 100 years later these are among some of CSIRO and Australia's biggest challenges.

  • For all our successful adaptations to the harsh Australian climate, we now face a climate changing faster than we can adapt;
  • We're no longer struggling to tap into our resources, but rather to establish sustainable ways to manage them; and
  • While still geographically separated from the rest of the world, our industries and people have never been more interconnected and interdependent.

What might have surprised Billy, though, is the importance of international collaboration and partnership that is now essential to success.

More than 50 years ago, we formed a partnership with a scrappy start-up in the States bent on reaching the moon – it was called NASA.

Over the following decades, our telescope in Parkes in regional NSW played a critical role in space exploration and in receiving those first images from the moon.

In the past couple of years, we're working with NASA to see even further – receiving the first images from Pluto – and to see even closer – taking some of the most detailed vision of the Great Barrier Reef.

Nearly 30 years ago, we started working with the sponsor of today's event, Boeing. That relationship has evolved from vendor to true partner, and together we've jointly invested more than $170 million across 190 projects in production efficiency, safety, analytics, platform systems, cybersecurity, space sciences, advanced materials, and direct manufacturing.

We turn deep science into customer-focused innovation at Boeing's largest R&D labs, which they've built in Australia; and we have one of our scientists based in their Seattle location.

Just this month, were named their Supplier of the Year - this time in the technology not academic category, beating more than 13,000 other partners to the title, and we look forward to many more years of achieving our shared goals and vision.

In fact, today it gives me great pleasure to announce a new five-year, $35 million research agreement with Boeing that will see us fly further towards the frontiers of space sciences, advanced materials and manufacturing.

This new agreement will continue to deepen and strengthen not only the relationship between CSIRO and Boeing, but also between Australia and the US as we raise the international bar for rewarding partnerships, setting an example for science-driven innovation to become the new aspiration for competitors around the world.

In addition to NASA and Boeing, we also have strategic, long term partnerships with GE, with the National Geographic and Atmospheric Administration (NOAA), with the Gates Foundation, with the US Department of Energy, with Chevron, and numerous US universities and research organisations.

In fact, the US has become our most significant research collaboration partner.

In 2015 alone, we shared 695 joint publications – nearly 20 per cent of our overall joint publications with any individual country – as well as nine bilateral MOUs signed and 581 visits to the US by CSIRO staff.

This month, we announced our research partnership with the University of California San Diego (UCSD) had developed a new glove with the ability to detect dangerous organo-phosphate compounds – chemicals that can be found in nerve agents like sarin, and some pesticides.

This sample I get to play with is missing the associated electronics and active enzyme, but on the index finger you can see the printed electrodes and interconnects made from stretchable inks, and on the thumb you can see the carbon swipe pad.

It can be used in a wide range of ways, from defence and forensic investigations' need for rapid response chemical screening, through to agricultural applications like farmers being able to handle their crops and detect pesticide levels without having to send swabs away to a lab.

In fact, the glove research paper in ACS Sensors just clicked over 16,000 downloads since being published last month. It looks like the most downloaded paper in the journal's history.

These are all incredibly rewarding partnerships for us, and we value our relationships in the US very highly.

In many ways, they reflect the relationship of a young scientist supporting an established researcher and contributing their talent and ideas to an already thriving institution.

Let me tell you about some of our science that's having a significant impact in the US without the support of major corporations.

One of those is a start-up we helped create called 'BuildingIQ'.

This smart energy system monitors conditions in commercial buildings and adjusts Heating, Ventilation and Air Conditioning systems in real time, reducing energy consumption by up to 30 per cent.

It's currently being used over more than 60 million square feet of commercial real estate in Australia and the US, including the Australian Technology Park here in Sydney, right through to the Rockefeller Center in NYC.

Another of these standalone innovations is Remote-I, a technology that was licensed in 2015 to a Silicon Valley spin-off called TeleMedC, who are planning to take it to the US and world market.

This technology uses satellite broadband to connect city-based eye specialists with patients in remote locations.

And most recently, last year we had an overwhelming response in the States to a new technology we developed for law enforcement.

A substance that utilises a truly unique molecular structure to show up fingerprints at crime scenes that glow in the dark, replacing centuries-old dusting techniques.

We're currently working with five different US states on their options.

This is the tip of the iceberg when it comes to Aussie innovations, and the shared passion for innovation across Australia and the US is only driving our commitment to deliver more.

In fact, I won't say "we've got an App for that" – but we do have a SOLUTION for that.

Under the Australian Government's National Innovation and Science Agenda, or NISA, announced just over a year ago, we secured funding to expand our sci-tech accelerator, called ON, to support not just great ideas in CSIRO, but across the entire Australian university and publicly funded research sector – including working alongside some of our government departments' R&D teams.

The intensive program takes on scientists with great ideas and enough research to show feasibility, then leads them through a market-ready process to identify customers, target investors, and develop business plans to turn those ideas into realities.

Our third cohort has just graduated from ON, and the products they are generating are mind-blowing.

Just this month we announced that our scientists have worked out how to produce oil in the leaves and stems of plants as well as the seeds which promises to be a game changer in the global production of renewable oils by increasing oil capacity by orders of magnitude, so oil won't compete with food.

That has led to the signing of a partnership with US company Amfora to develop and commercialise the technology.

Other graduates of the program have included:

  • A new seaweed-based feed supplement for cattle called Future Feed. It's not only cheaper than other feeds, but reduces methane emissions from the livestock – a product with huge potential for the global beef industry, which is huge in both Australia and the US.
  • A facial-recognition technology called e-PAT, that can tell doctors when a non-verbal patient is in pain. With a globally ageing population, this is only going to become more necessary.
  • And forget the age-old chicken and egg problem, we've solved the vaccine and egg problem with Vaximiser. This can grow an egg that yields ten times more of the protein needed to create vaccines, making tackling the world's biggest diseases cheaper and more efficient.

As part of the ON process, some of our teams recently visited Silicon Valley on an investment-seeking mission, and we hope to see many of them making their US marketplace entries soon.

The passion and drive behind these breakthrough innovations reflect the culture within our ON program, where so many of our older scientists find themselves saying, "I feel completely re-energised, like I was a student again".

It's capturing that early career passion and funnelling it into innovation. A fountain of scientific youth.

So I've talked about our traditional, long-standing partnerships with major US organisations, I've talked about the individual entries of different inventions into the US market, but there's one other pathway I want to talk about before I get into the details of our US Strategy.

CSIRO works with more than 1200 small and medium businesses every year, from placing researchers in their companies to helping them access large-scale research infrastructure, like our advanced manufacturing facility, Lab 22, in Melbourne.

We help them help increase productivity and efficiency, decrease costs, develop new capabilities and products, and make their business more environmentally sustainable.

If you've spent any time on an Australian beach, or rushing after a teenager who thinks the laws of gravity don't apply to them, you might be familiar with the great Australian invention of the Green Whistle, or Penthrox Green Whistle.

It's a non-addictive, simple to administer, pain relief inhaler, used by sporting clubs, ambulance services, the defence force and others.

We've been working with Medical Developments International (MDI) for more than 18 years, and after developing the initial production process for Penthrox together, we've now vastly improved it, allowing it to be scaled up and successfully launched into the European market.

Their market value has risen from less than $10 million in March 2010 to more than $290 million in March 2017.

And they're well into the product approval process for expansion into the US.

To deal with the demand generated by these new markets, they've built a new factory in Melbourne, creating new domestic manufacturing jobs.

We're so proud to have been part of this Australian sci-tech success story.

Another of our SME partners is even further along in their journey into the US, with sleep apnoea mouthguard company Oventus opening its US office in January.

When Brisbane dentist Chris Hart approached us about his idea for a personally designed mouthguard, we were all too happy to lend our advanced manufacturing expertise.

Designed with software that maps an individual's mouth, and then 3D printed in titanium, the Oventus mouthguard had a phenomenal response in Australia, and in January, opened their doors in the US as part of G'Day USA celebrations. By the way, this turns a cheap commodity, Titanium mineral sands, into a unique 3D printer ink, and then into a custom medical device.

This is the gold standard for our small and medium business partnerships. This is the gateway we want to open for more of our innovative Australian businesses.

These are the examples we see as the Boeings or GEs of the future – when you pair the passion of an early career scientist with an early growth business, you are dealing with amounts of energy they don't have an equation for in physics.

So we've already got some runs on the board in the US.

We have many long-standing partnerships with major US corporations and organisations; our science is being commercialised and adopted around the country; and now the Australian small and medium businesses we support are making in-roads into this expansive market.

What has that meant for our bottom line at CSIRO?

  • 23 per cent of our total revenue in 2011-2015 came from international sources, and we saw that increase last year.
  • 33 per cent of our future pipeline revenue for 2015-2020 is set to come from international sources.
  • This track record presents an opportunity for significant expansion.

When we launched our new Strategy two years ago, called Strategy 2020, we identified the US as a major priority, and since then, we've made some strong progress.

  • I've already told you about the rapid expansion and success of our sci-tech accelerator, ON, which we run on behalf of the nation for all Australian universities and research bodies.
  • We've increased our revenue from international sources by around 20 per cent.
  • We've increased our active licensing – a measure of how we’re retaining value from our IP – by 25 per cent.
  • We were listed 18th in the top 25 most innovative government agencies in the world by Reuters, a list we've never been on before, based on our publication and patent results.
  • And we've increased our US business engagement to 49 of the US Fortune 500. But we have room for 50, so if one's here please see me after.

So this is our US opportunity.

We have more than 50 years of partnerships, and incredible momentum in the past two years.

That's why in January this year, at a G'day USA event in LA, we announced plans to open our first US office in San Francisco.

We'll grow our relationships, our visibility and our opportunities for the best Australian science and technology to reach the US, whether that's through R&D partnerships, research collaborations, innovative spin-outs and start-ups, or Australian businesses expanding their options.

And like any good expat heading off overseas, we're plugged into a great network there too.

We've been working closely with Austrade and DFAT, as well as supporting new local expat communities like the Aussie Founders Network and old ones like Advance Global to spread the word and make new connections.

Our San Mateo office will provide a base for our intrepid CSIRO travellers, including visiting researchers, new spin-outs and the latest and greatest innovators from our commercialisation pipeline, as well as hosting events to strengthen our relationships and increase our visibility.

The office will be the heart of our hub & spoke model, centralising our resources while maximising our reach and impact into targeted areas of the US where our research can have most traction:

  • We'll continue our strong relationship with Boeing in Seattle,
  • We'll build our presence in Houston, Dallas, initially through our existing energy partnerships there,
  • We'll strengthen relationships and opportunities with the US government, development agencies and corporates on the East Coast, and
  • We'll take our work in agriculture and food to the MidWest, with future opportunities in health among the potential for growth there.

By 2020, we want working with CSIRO to be synonymous with a game plan for entry into the US market for unique Australian products, which will be differentiated from their competitors with world-class sci-tech R&D.

This gateway will be a two-way street, returning scientific and economic returns to Australia, as well as creating new opportunities and frontiers for areas like:

  • IP Law as more of our intellectual capital goes global
  • Health systems and solutions as we take on the international challenge of an ageing population
  • Connections to innovative and entrepreneurial expat communities that are both energised and supportive of Australian talent
  • And venture capital opportunities as more of our ON graduates and other innovative concepts look to the US market.

Let me be clear, this isn't about de-prioritising anything we do in Australia, it's about stepping up Australia's presence on the world stage.

This is our chance to unleash our fresh, vibrant and world-class skills and knowledge in an established and mature innovation eco-system hungry for new talent.

It's our opportunity to bring a spark of Aussie ingenuity to a supportive mentor and wise guide.

And it's our intention to make our mark and return the benefits to Australia, as part of a symbiotic and complementary relationship between long term partners that will see each grow and prosper according to their own unique strengths.

Led by deeply aligned partnerships, like the new contract we announced with Boeing today, CSIRO looks forward to a relationship with the US that sees our science go further, to benefit more people, and return more value to Australia, cementing our place in the global innovation ecosystem.

When I look around and I see excitement around the latest app or the 'next Uber', and I compare it to the real value that deep science and technology can create, I certainly feel like the older scientist paraphrasing a dated, but great Australian phrase that has earned its royalties in the States:

"That's not an innovation. This is an innovation."

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