Nobel Foundation

The Nobel Foundation was founded on 29 June 1900, five years after the death of Alfred Nobel, to manage his fortune and carry out the provisions of his will. Nobel's will stipulated that his estate should be invested in safe securities and the interest used to fund annual prizes in physics, chemistry, physiology or medicine, literature, and peace. The foundation was established after negotiations among the executors, the prize-awarding institutions, and the Swedish government, resolving legal challenges and clarifying the statutes for the prizes.

The foundation's initial capital was about SEK 31 million, a substantial sum at the time. Over the decades, the foundation has adapted its investment strategies to preserve and grow the capital, ensuring the long-term sustainability of the prizes. It also manages the Nobel Prize in Economics, which was added in 1968 by the Sveriges Riksbank in memory of Alfred Nobel, though it is not part of Nobel's original will.¹

The Nobel Foundation is not involved in the selection of laureates; that responsibility rests with the prize-awarding institutions: the Royal Swedish Academy of Sciences (physics, chemistry, economics), the Karolinska Institutet (physiology or medicine), the Swedish Academy (literature), and the Norwegian Nobel Committee (peace). The foundation's primary role is to manage the Nobel capital, administer the prize ceremonies, and protect the Nobel trademark and brand.

The foundation is governed by a board of directors, elected by the trustees of the prize-awarding institutions. The board is responsible for the foundation's investments and overall strategy. The foundation also organizes the Nobel Prize Award Ceremony in Stockholm and the Nobel Peace Prize Ceremony in Oslo, as well as the Nobel Banquet and other official events. It also manages the Nobel Prize Museum and the Nobel Prize website, which serve to disseminate knowledge about the prizes and their laureates.

The Nobel Foundation's investment policy is designed to generate a stable return that can fund the prize amounts and operational costs while preserving the capital's real value. Historically, the foundation invested primarily in bonds and real estate, but since the 1950s it has diversified into equities and other assets. As of 2023, the foundation's assets were valued at approximately SEK 6.1 billion, and the prize amount for each Nobel Prize was set at SEK 11 million.

The foundation's investment strategy is overseen by an investment committee and external managers. It follows a prudent approach, with a focus on long-term sustainability. The foundation also receives donations and sponsorships for specific events, such as the Nobel Prize Concert, but the core funding for the prizes comes from the endowment. The foundation's financial reports are publicly available, and it is subject to Swedish regulations for foundations.²

Beyond managing the prizes, the Nobel Foundation engages in various outreach activities to promote science, literature, and peace. It organizes the Nobel Prize Inspiration Initiative, which brings Nobel laureates to universities and research institutions to share their experiences and inspire young scientists. The foundation also supports the Nobel Prize Museum in Stockholm, which offers exhibitions and educational programs about the laureates and their discoveries.³

The foundation also plays a role in the Nobel Prize Award Ceremonies, which are broadcast worldwide. It collaborates with the prize-awarding institutions to ensure the integrity and prestige of the prizes. Additionally, the foundation has developed the Nobel Prize digital platform, which provides free access to lectures, articles, and archival material. These efforts aim to fulfill Alfred Nobel's vision of rewarding those who confer the greatest benefit on humankind.⁴

One lesser-known fact is that the Nobel Foundation has faced financial crises in the past. In the 1920s, the foundation's capital was severely depleted due to inflation and poor investments, leading to a reduction in prize amounts. It was not until the 1950s that the foundation adopted a more aggressive investment strategy, which allowed the prizes to grow in value.

Another niche aspect is the foundation's role in the Nobel Prize in Economics, which is not a Nobel Prize in the original sense but is administered by the foundation. The foundation also manages the Nobel Prize in Literature, which has been subject to controversies, such as the 2018 postponement due to a scandal within the Swedish Academy. The foundation stepped in to manage the crisis and ensure the prize's integrity.

Additionally, the foundation has a special committee that handles nominations for the Peace Prize, which is awarded in Oslo, not Stockholm. The foundation also owns the Nobel Prize medal design, which has remained largely unchanged since 1902, except for the Peace Prize medal, which has a different design.

Alfred Nobel

Swedish chemist, engineer, and industrialist who invented dynamite and established the Nobel Prizes through his will.

Prize-awarding institutions

The organizations that select Nobel laureates: the Royal Swedish Academy of Sciences, Karolinska Institutet, Swedish Academy, and Norwegian Nobel Committee.

Nobel Prize in Economics

Officially the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, established in 1968 and administered by the Nobel Foundation.

Endowment

The invested capital of the Nobel Foundation, which generates income to fund the prizes and operations.