Tuesday, June 12, 2012

Nobel Prize Amounts Reduced

The Board of Directors of the Nobel Foundation announced in Stockholm on Monday a 20% reduction in the amounts given to Nobel Prize winners.  Consequently, the 2012 Nobel Prize winners will each go home with 8.0 million Swedish Kronor (equivalent to USD 1.1 million based on the current exchange rate instead of the SEK 10 million or $1.4 million previous winners had received). This is the first time the value of the prize has been reduced since the 63 years it has existed. 

There will also be a drastic reduction in the size and nature of the Nobel Prize annual banquet. In a statement in Stockholm on Monday June 11, 2012 after its meeting, the Nobel Foundation said it regards the measures it is taking as necessary “in order to avoid an undermining of its capital in a long-term perspective.”  
The Foundation's statement is reproduced in full below:
The Nobel Foundation 

Press Release
June 11, 2012

At its meeting on June 11, 2012, the Board of Directors of the Nobel Foundation set the amount of the 2012 Nobel Prizes at SEK 8.0 million per prize, at today's exchange rate equivalent to USD 1.1 million. This implies a lowering of the prize sum by 20 per cent. The Nobel Foundation regards this as a necessary measure in order to avoid an undermining of its capital in a long-term perspective.

One of the most important tasks of the Nobel Foundation is to safeguard the economic base of the Nobel Prize. The capital left behind by Alfred Nobel must therefore be managed in such a way that it will be possible to award the Nobel Prize in perpetuity, while guaranteeing the independence of the prize-awarding institutions.

(L-R) Queen Silvia of Sweden, Princess Madeleine
of Sweden, King Carl XVI Gustaf of Sweden, Prince
 Carl Philip of Sweden and Crown Princess Victoria
of Sweden during the Nobel Foundation Prize 2008
Awards Ceremony at the Concert Hall  on December
10, 2008 in Stockholm, Sweden. ( Source: Pascal Le
Segretain/Getty Images Europe)

The decision to lower the prize sum, from SEK 10.0 to 8.0 million, is related to the assessment that the Board of Directors makes today of the potential for achieving a good inflation-adjusted return on the Nobel Foundation's capital during the next several years. Another part of the picture is that during the past decade, the average return on the Foundation's capital has fallen short of the overall sum of all Nobel Prizes and operating expenses. The costs of the Nobel Foundation's central administration and the Nobel festivities are therefore being reviewed.

"The Nobel Foundation is responsible for ensuring that the prize sum can be maintained at a high level in the long term. We have made the assessment that it is important to implement necessary measures in good time," says Lars Heikensten, Executive Director of the Nobel Foundation.

Professor Wole Soyinka, Nobel Prize Winner 

The various organisations in the Nobel sphere also jointly manage large assets connected to the Nobel Prize as a trademark. This includes not only the Nobel Foundation and the prize-awarding institutions, but also the organisations that disseminate information about the Nobel Prize and the achievements of the Laureates, such as Nobel Media and the Nobel Museum in Stockholm and the Nobel Peace Center in Oslo.

Since the Nobel Foundation's capital must be used primarily to pay for the work of the Nobel committees and the prize sum itself, these information activities are essentially externally financed, for example via grants from central or local government authorities, corporate sponsors, private donors, foundations or philanthropic entities.

Nadine Gordmer, Another Nobel Prize Winner
The same is true of the investment in a Nobel Prize Center on the Blasieholmen peninsula in central Stockholm which was announced earlier. The equity of the Nobel Foundation will not be used either for the building or for the operation of a future Center.

"The Nobel Prize Center will become an important base in our long-term efforts to preserve the stature of the Nobel Prize and disseminate the message of the Nobel Prize to a global audience," says Lars Heikensten, Executive Director of the Nobel Foundation.


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