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Company Number: 615259 Charity Number: 206504

THE INTERNATIONAL INSTITUTE FOR STRATEGIC STUDIES

ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 SEPTEMBER 2025

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30 September 2025

Annual Report and Financial Statements

1 Strategic Report and the Report of the Trustees
20 Independent Auditor’s Report to the Members of The International Institute for Strategic Studies
23 Consolidated Statement of Financial Activities
24 Consolidated Balance Sheet
25 Charity Balance Sheet
26 Consolidated Cash Flow Statement
27 Notes to the Financial Statements

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30 September 2025

STRATEGIC REPORT AND THE REPORT OF THE TRUSTEES

The Trustees present their report for the year ended 30 September 2025. This incorporates the Directors’ report, which has been prepared in accordance with the Companies Act 2006 and FRS102, and the Strategic Report. The accounts comply with current statutory requirements, the Memorandum and Articles of Association and the Statement of Recommended Practice ‘Accounting and Reporting by Charities’ (SORP).

The primary role of the International Institute for Strategic Studies (referred to as ‘IISS’ or ‘the Institute’) is to enhance public understanding of questions of international security, help to provide policy makers with facts and analysis to inform and advise their decision-making, and contribute to improved defence diplomacy and conflict resolution.

Strategy

The Institute’s medium- to long-term strategy comprises four elements as follows:

to provide facts and analysis on the sources of conflict, however caused, which may provoke the use of organised military force, and to examine the changing nature and use of organised force in international affairs;
to provide facts and analysis on the nature of political, geopolitical and geo-economic risk and advise governments and the private sector on measures that can be taken to mitigate that risk;
to provide an independent platform for intergovernmental consultations on geopolitical and geoeconomic issues in private and public settings, supported by the facts and analyses developed by the Institute; and
to sustain a network of experts in these matters on the permanent staff, on a part-time consulting basis and also generally among an engaged cohort of the individual membership.

The Institute measures the success of this strategy in the following ways:

evidence of senior government leaders internationally seeking IISS independent analysis;
attendance at its dialogues and conferences by government officials, international business and media representatives from around the world;
evidence that the Institute has contributed to improved defence diplomacy and conflict resolution, as confirmed to IISS by government officials;
continued diversification of funding from governments, the private sector, charitable foundations and individuals to maintain a significant body of research across a broad range of thematic and regional programmes;
worldwide demand for its publications and databases.

The Institute achieved the main objectives set by the Trustees for the year, which included the expansion of its research output, convening activity and dissemination of its publications, enhanced digital content, and widening the Institute’s international network and global coverage. More details can be found in the Achievements and Performance section on pages 3 to 9.

Research, Dissemination and Digital Content

During the past year, the Institute has continued to strengthen its digital-channel portfolio and celebrates the continuous growth of IISS audience reach, surpassing a significant milestone of 500,000 followers across all social media channels, an 11.7% annual increase. LinkedIn has become the most followed IISS channel with over 234,000 followers as of 30 September 2025. Instagram has become the fastest growing channel this year, with a 79% increase in followers. An increased focus on data visualisation, and the use of graphic content and images to illustrate complex topics, has resulted in increasing engagement from audiences. Graphics on European ballistic-missile defence (322,000 views), F-35

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30 September 2025

programme (227,000 views), defence-industrial partnerships (214,000 views) and Russian sabotage operations in Europe (132,000 views) have all achieved over 100,000 impressions.

The IISS website audience reached over 1.8 million unique users in the past year, with content gathering a total of 5.1 million views. Most website views came from the United States (over 1.2 million), the United Kingdom (over 690,000), Singapore (over 301,000), Germany (over 243,000) and India (over 230,000). The website’s most viewed pages, other than the homepage, were Careers (over 100,000 views), the Military Balance (over 95,000), Shangri-La Dialogue 2025 (over 84,000), the Military Balance+ (over 67,000) and Research Papers (over 42,000). The most viewed Online Analysis article was ‘Global defence spending soars to new high’ by Fenella McGerty and Karl Dewey (viewed over 42,000 times).

In the past 12 months, two further ‘Charting’ products (Charting Middle East and Charting Cyberspace ) have been added to the evolving digital-product portfolio in addition to Charting China . Podcast content continues to be an increased area of focus with the Sounds Strategic , Japan Memo and Arms Control Primer podcasts downloaded over 30,000 times and listened to over 15,300 times on YouTube.

The Communications team continued to support funded projects in close collaboration with research teams, including the launch and amplification of the Arms Control Primer podcast. Existing IISS flagship publications and key events were supported with recordings, transcripts and short-format content quickly being made available across website and digital channels, adding value to audience experience. Alongside usual media engagement, the Institute organised media roundtables where IISS experts briefed journalists and responded to questions, with high demand for their analysis and comment on both the Russia/Ukraine and Israel/Hamas wars. This year has also seen growing demand from global print and broadcast media to attend flagship IISS events.

Convening Power

The Institute continued to extend its platforms for intergovernmental consultation and dialogue, in both private and public settings, to improve defence diplomacy and conflict resolution. In all cases, the Institute was able to create informed debate, develop new networks of contacts and engage governments, the private sector, the international expert and opinion-forming community, and IISS members in both open debates and confidential discussions to improve mutual understanding of differing positions and promote new policy approaches. During the year, the Institute convened 112 events in ten countries with 7,851 attendees participating from over 100 countries.

The Institute also continued to deploy its convening power and analytical excellence informally via meetings between senior researchers and leading government figures and policy makers from a range of countries. At these meetings the Institute leverages its global reach and data-based approach to analysis to provide information on strategically important policy decisions being made at the highest levels.

Global Coverage and International Strategic Network

Investment in analytical expertise and in enhancing the role of its four international offices has been a core focus of the Institute in recent years to bring a powerful global perspective to all of its work, as well as engendering the widest possible engagement on issues of international security. Details about the activities of the international offices can be found on pages 15 to 16.

OBJECTIVES AND PRINCIPAL ACTIVITIES

The Institute’s declared objects are ‘ to promote on a non-party basis the study and discussion of and the exchange of information upon any major international security issues including without limitation those of a political, strategic, economic, social or ecological nature, and to promote conflict resolution by facilitating discussion and dialogue and publishing analysis on major international security issues to assist and promote the resolution of conflicts between or within nations’ .

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30 September 2025

The Institute aims to achieve these objects by providing to IISS members, governments, international organisations and the wider public the best possible objective information on military and political developments relevant to the prospects, course and consequences of conflict having an important military dimension. In furtherance of its objectives, the Institute:

delivers a comprehensive research programme committed to advancing wider understanding of constantly evolving global security issues;
convenes government officials, independent analysts, business leaders and journalists to advance understanding of political, military, economic, environmental and societal trends in the subjects addressed by the Institute's work;
continues to enhance the online content offered through the iiss.org website to maximise global access to its research and analysis; and
maintains an international network of influential and knowledgeable individuals, corporate entities, governments and others as an audience for its research and publications.

The Institute’s achievements against its objectives are discussed under the heading ‘ Achievements and Performance’ below.

The Institute’s ‘statement of values’ and ‘policy on financial transparency confidentiality and effectiveness’, published on the IISS website, reaffirm the IISS’s commitment to full independence and excellence in all activities, along with the Trustees’ determination that fundraising is maintained with the twin aims of guaranteeing the Institute’s independence of thought and analysis, as well as maintaining the Institute’s effectiveness as a strategic actor in a complex international environment.

The charity had no fundraising activities requiring disclosure under provisions of section 13 of the Charities (Protection and Social Investment) Act 2016.

ACHIEVEMENTS AND PERFORMANCE

Research Programmes

As an independent, non-partisan and international policy institute, the IISS is committed to advancing wider understanding of the critical security issues of the 21st century and their potential trends or resolution. The comprehensive research programme covers these challenges and responds to them both thematically and regionally. The IISS Advisory Council, composed of distinguished members from around the world, assists the Institute on the intellectual direction of its activities. The programme has been defined under the broad categories of War, Power and Rules covering strategic themes and regional concentrations:

Conflict, Security and Development
Defence and Military Analysis
China
Cyber Power and Future Conflict
Geo-Economics and Strategy
Strategy, Technology and Arms Control
European Security and Defence
US Foreign Policy and Transatlantic Affairs
Indo-Pacific Defence and Strategy
Japan Chair
Korea Chair
Latin America
Middle East
Russia and Eurasia
South and Central Asian Defence, Strategy and Diplomacy
Nuclear Arms Control, Non-Proliferation  Southeast Asian Politics and Foreign Policy and Disarmament

IISS research programmes actively contribute to a range of government and corporate briefings, convene external and IISS member events, deliver podcasts, and produce research and analysis for the wide range of IISS publications. The Institute has paid increasing attention to facilitating dialogue and conflictresolution. This is achieved by bringing together parties in ‘track-two’ meetings, involving nongovernmental experts, to discuss differences and consider how common interests can be advanced.

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30 September 2025

In the period under review, IISS research and research-related activities achieved notable impact on a number of fronts. The following is a list of key examples across the Institute’s programmes:

Aside from publishing a Strategic Dossier, entitled Progress and Shortfalls in Europe’s Defence , the Defence and Military Analysis (DMAP) programme produced several research reports including Tracking the Components of Missiles and UAVs used by Russia in Ukraine; Defending Europe Without the United States: Costs and Consequences; Enabling Responsible Space Behaviours Through Space Situational Awareness; and A European Reassurance Force for Ukraine. DMAP continued to organise activities for its Missile Defence Initiative (MDI) programme and publish regular blog posts on important defence developments. The team welcomed new colleagues to conduct research into space security and advanced technology.
The Strategy, Technology and Arms Control (STAC) programme published analyses on nuclear weapons and other strategic issues, which were amplified through policy and media briefings. STAC contributed to MDI events and publications, an IISS Track 1.5 project on Iran, and briefings on the military uses of space. It also reconceptualised the Arms Control Primer podcast , in its fourth season of the EUNDP Consortium, to explain national nuclear doctrines and expand its audience.
The Russia and Eurasia programme published widely cited output across IISS and other channels, notably on the Russia-Ukraine war. The programme hosted and delivered a series of events with high-level participation, including a roundtable on Russia sanctions and an EU-funded workshop on Russian influence strategies. Briefings were delivered to official, corporate and media audiences, and several European governments. The programme was awarded an EUCOM grant for a research project on "Russian grand strategy and domestic social cohesion".
The Geo-economics and Strategy Programme broadened the scope of its research work to include broader elements of economic security, such as government policy towards high-technology industries, supply-chain security and critical-minerals policy. The programme has hosted a number of events and contributed towards several papers on these and related issues. The programme has also been invited to produce analysis for governments and companies on economic-security issues.
The Japan Chair Programme published its third Adelphi book in 2025 analysing the effectiveness of Japan's new grand strategy given the country's strengths and weaknesses and its own definition of Japan's national power. The Japan Memo monthly podcast series, now more than 50 episodes old, covered a wide variety of Japan-related issues, ranging from energy security to Japan's relations with the US and China and Japan's role in Indo-Pacific minilateralism. The programme published articles on Japanese defence and economic-security policy, and hosted several events, including one on critical minerals, the secure supply of which is strategically vital for Japan.
The Cyber Power and Future Conflict (CPFC) Programme expanded its reach and influence through high-profile workshops, research, and international dialogues. This included the 4th Future Conflict Workshop in Singapore convening defence organisations from 21 countries and a UK-China Track 2 dialogue on military AI. The programme started a Charting Cyberspace infographic series, setting out power across the layers of cyberspace, Russia’s Information Confrontation Doctrine, Sovereign AI, and trends in state attribution for cyber incidents. It published research papers on topics including the national security implications of biotech, Russia’s information confrontation doctrine in practice, and the adoption of cloud for national security and defence in the Asia Pacific. Additionally, the programme supported the monthly Executive Briefs for GSIS (as outlined below). CPFC will fully launch the Cyber Power Matrix in January 2026, the most comprehensive public dashboard documenting global expressions of state cyber power from the past decade to the present.
The newly established Southeast Asian Security and Defence Programme (formerly Southeast Asian Politics and Foreign Policy Programme) completed the cross-IISS research project on Southeast Asia’s emerging anti-access environment, as well as updating the Myanmar Conflict Map and publishing accompanying reports on Myanmar and Southeast Asian security. The team are also in the process of delivering two new research projects: one on conflict prevention in Southeast Asia,

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30 September 2025

and another on regional nuclear crisis responses. The Senior Fellow leading the programme edited and delivered the 2025 Asia-Pacific Regional Security Assessment at the IISS Shangri-La Dialogue.

The Indo-Pacific Defence and Strategy Programme focussed on completing a cross-IISS research project on South and Southeast Asian perspectives regarding nuclear escalation dynamics in the region. It has also commenced a project on Nordic-Baltic engagements in and strategies for the IndoPacific. It also produced Online Analyses on regional security questions, podcasts, and engaged actively in IISS corporate briefings.
Supported by endowment funding, the IISS recruited a Senior Fellow for Nuclear Arms Control, NonProliferation and Disarmament based in the Singapore office who started his role in October 2025.
The Middle East programme continued to provide analysis on the various wars in the Middle East, most notably the 12-day conflict between Israel and Iran and the war in Gaza. Middle East analysts authored IISS analysis as well as contributions to external publications such as Foreign Affairs and the Financial Times. Commentary on regional politics drew on the IISS Strategic Dossier: Turbulence in the Eastern Mediterranean: Geopolitical, Security and Energy Dynamics, released in December 2024. The team supported the research and production of a major report on Syria's security sector titled From Fragmentation to Integration: Prospects for Security Sector Reform in Post-Assad Syria. The programme’s Senior Fellows actively disseminated IISS analysis at major conferences, including the NATO summit in the Hague. Finally, the Middle East programme introduced Charting Middle East , a visual overview of significant geopolitical trends and developments in the Middle East and North Africa region, publishing five editions.
The South Asia programme’s annual ‘track 1.5’ South Asia Security conference in Muscat in November 2024 brought together senior officials and experts and was followed by a smaller IndiaPakistan ‘track 2’ conversation in February. The progress made in these two meetings was shattered by the India-Pakistan conflict in May 2025, but despite the high-level of bilateral tensions, in July the programme hosted political leaders from India and Pakistan meeting each other for the first time since the conflict. In November 2025, senior officials from both India and Pakistan reconvened in Muscat, marking a special 20th anniversary of this series of conferences. In addition, the Third 'track 2' ‘intra-Afghan’ dialogue was held in Istanbul in February and the third ‘track 1.5’ conference on India-China relations took place in Singapore in September 2025. The annual ‘track 1.5’ dialogues on regional nuclear deterrence were held in New Delhi in June and Islamabad in November 2025 with policy-relevant research published to inform, encourage, and influence engagement and discussion.
Conflict, Security and Development Programme (CSDP) activities included the publication of The Armed Conflict Survey (ACS) 2025 (as referenced below), with a focus on economic models of nonstate armed groups (NSAGs). Work continued around organised crime and criminal economies, NSAGs, political risks, geopolitical shifts, stabilisation and reconstruction, as well as conflict monitoring, with the production of online analyses, articles, ACS chapters and events. CSDP also conducted field research on security sector reform in Syria and instability dynamics in the Horn of Africa, with the organisation of two international workshop on the topics in Berlin and the publication of two policy reports. Funded by the German Ministry for Foreign Affairs, a dossier style publication on engagement with NSAGs will be published in early 2026.
The China Programme’s work this year revolved around three main themes: China’s defence diplomacy, shifting deterrence landscape in the Indo-Pacific, and cross-Strait relations. This involved conducting research on the role of the PLA’s engagement across the Indo-Pacific as part of China’s Global Security Initiative. Additionally, the programme has applied novel ways to examine the political, military and economic costs of hypothetical crises or conflicts in Asia, in order to better understand the changing landscape of partnerships and alliances in the region. The team continued to publish its Charting China infographic series to highlight datasets on China-related research topics for a wide variety of audiences, and to deliver briefings to corporate members, governments and the media.

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30 September 2025

Publications

In 2025 the IISS has continued to see growth in print and ebook formats for commercial publications across the entire portfolio, and high readership of frequent pieces of online analysis on the IISS website.

Strategic Comments covers international security and political-military issues. With both paid offerings through publisher Taylor and Francis (T&F) and selected articles free to read via IISS.org, this year’s articles included the EU’s evolving view of China, political upheaval in Nepal, King Jong-un’s strategic choices, Israel’s domestic divisions, Japan’s increased engagement with China, the ‘new-era’ in EU-UK relations, the low-intensity conflict between Afghanistan and Pakistan, and South Korea’s political crisis.

Military Balance 2025 , launched in February, provided data and capability assessments for the armed forces of over 170 countries. The 66[th] edition assesses important defence issues by region, including Russia’s invasion of Ukraine, the diverse range of ballistic and cruise missiles used by the Houthis, and developments in defence industrial production. The accompanying wallchart focused on China’s armed forces, detailing selected unit locations and assessing important aspects of PLA modernisation.

The Military Balance+ database combines multiple years of data and qualitative assessments with advanced search and graphical capability. The product has received a variety of functional and performance enhancements and continues to be updated across all modules. The work to expand air equipment fits has passed several milestones, and a further highlight is an expansion of the dataset on the Ukrainian armed forces, which introduces information down to battalion level.

The Institute’s journal, Survival: Global Politics and Strategy , published six times per year, provides a platform for many of the leading thinkers in the field of international affairs to analyse and debate strategic questions. The April–May 2025 issue (volume 67, number 2) featured five articles on Trump’s America and the Transatlantic Future. The October–November 2025 issue of Survival (volume 67, number 5) featured two full articles under the rubric ‘Present Danger’: European Military Autonomy: What Comes First? by Barry Posen; and Europe Resolved: The Drumbeat of Strategic Autonomy by Erik Jones. A sharp turn in reader preference from online articles to print and ebook continues.

The 2025 edition of the annual Armed Conflict Survey provided a review of the political, military and humanitarian dimensions of active armed conflicts from July 2024–June 2025. The review is complemented by strategic analysis of regional and global drivers and conflict outlooks, providing unique insights into the geopolitical and geo-economic threads linking conflicts. This edition also includes Regional Spotlight chapters on the economics of non-state armed groups (NSAGs), including the diversification of drug-trafficking organisations in the Americas; the emerging arms-trafficking activities stemming from Ukraine; and the economic strategy underpinning Hayat Tahrir al-Sham’s evolution from NSAG to leader of the Syrian transitional government. This edition’s Chart of Armed Conflict provided a visual overview of the global conflict landscape, with a particular focus on migration.

The Adelphi series is the Institute’s principal contribution to policy-relevant, original academic research. In January, Joshua Rovner’s Strategy and Grand Strategy was published with an online webinar, followed by a promotional event at IISS-Americas. The book sold over 460 copies within the first 10 months, making it the Institute’s bestselling title of the year outside of The Military Balance . In May, Robert Ward’s Evaluating Japan’s New Grand Strategy was published, with an online promotional event in July. On 23 September 2025, we published C. Raja Mohan’s India and the Rebalancing of Asia, which was followed by an online launch the following day and a promotional event at IISS-Asia in early November.

In June, the latest Asia-Pacific Regional Security Assessment ( APRSA ) became an annual publication in the Taylor & Francis (T&F) portfolio and is now sold on their online platform, and in print via Routledge.com and other third-party channels. The 2025 edition contained a special chapter on defence industrial partnerships, covering companies and countries from Europe, Northeast, South and Southeast Asia, as well as the Middle East.

As well as the regular T&F titles, the IISS continued to disseminate publications to governments, businesses, think tanks and important thought leaders. In addition to these well-received reports, two new

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30 September 2025

Strategic Dossiers , Building Defence Capacity in Europe: An Assessment Progress and, Shortfalls in Europe’s Defence: An Assessment were published to accompany the IISS Prague Defence Summits in November 2024 and September 2025. The first book evaluated the key areas for building defence capabilities in Europe whilst the second assesses the progress that has been made in building up capability and evaluates the prospects for European allies achieving NATO’s new investment pledge.

The first Global Security and Innovation Summit (GSIS) convened in Hamburg in October 2025, with supporting publications in the form of twice-monthly briefing documents available as free to read online. Topics included digital identities in Europe, European opportunities in biotechnology, the AI challenge for governments and the semiconductor ecosystem and export controls.

Dialogues, Lecture Series and Conferences

The Institute’s international dialogues bring government officials together in a combination of formats, and address subjects that they might not be able to coordinate themselves. Under the international auspices of the Institute, it is often easier to arrange for discreet contacts to take place between government officials who wish to meet, but to do so unofficially and away from the public eye. In addition, the Institute organises lecture series and specialist conferences around the globe.

1. The Shangri-La Dialogue

Initiated in 2002, the Annual Asia Security Summit (IISS Shangri-La Dialogue) is the most important regular gathering of defence professionals in the region. Governments, the expert community, and media view the substance and tone of exchanges at the Dialogue as important indicators of the state of the region’s security. The Dialogue provides a platform for defence ministers and other principals to clarify their countries’ positions on important regional security topics. The Dialogue also allows senior regional defence leaders to enhance cooperation with one another, notably through the meetings on the Dialogue’s sidelines, to develop a sense of common community and solutions to regional challenges.

The 22nd IISS Shangri-La Dialogue convened from 30 May to 1 June 2025 amidst an increasingly complex and interconnected security environment. The current challenges to regional stability include the proliferation of arms and the weakening of arms-control mechanisms, along with new developments in the domains of cyber, outer space, and undersea. In addition to six plenary sessions, this year’s Dialogue included three live-streamed special sessions, featuring senior military and defence leaders, which discussed topics ranging from crisis management to maritime security, and defence innovation.

A common thread running through all the discussions was the need for greater collaboration to stabilise and strengthen the international order. In his Keynote Address, President of the French Republic Emmanuel Macron noted the opportunity for a new special relationship between Europe and Asia in this more competitive world. Similarly, in his Special Address, Malaysian Prime Minister Dato’ Seri Anwar Ibrahim warned against bloc politics and underscored the need for countries to increase their strategic aperture, as ASEAN has done this year through, for example, the ASEAN–GCC–China trilateral.

The 2025 Dialogue welcomed 558 delegates, including three heads of state, 28 government ministers, 28 chiefs of defence and seven international organisations. It was attended by 54 national delegations and 57 nationalities. Hundreds of government meetings took place on the sidelines of the event, with the IISS facilitating more than 70 of them. 40 delegates from the Southeast Asian Young Leaders’ Programme (SEAYLP) were welcomed from 19 countries in the Asia-Pacific and beyond who actively engaged in the Dialogue’s public sessions and organised discussions with senior officials.

2. The Manama Dialogue

Since its inception in 2004, the IISS Manama Dialogue has become a central element in the Middle East’s security architecture, where national leaders and ministers from the Middle East, North America, Europe, Asia, and Africa make major policy statements. The Dialogue also offers government delegations a bespoke occasion to consult bilaterally and multilaterally on the most pressing security and foreignpolicy challenges.

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30 September 2025

The 20th IISS Manama Dialogue was convened from 6 to 8 December 2024. It featured an opening address from Dr Abdullatif bin Rashid Al Zayani, Minister of Foreign Affairs, Kingdom of Bahrain, who underlined Bahrain’s approach to international relations and foreign policy. He highlighted the importance of upholding the integrity of international systems and values during turbulent times and engaging effectively with partners who have shared aspirations and interests to end conflicts, ease tensions, and resolve key regional and international issues. As always, the Dialogue facilitated defence diplomacy and led to tangible results, most notably the Canadian government signing a defence cooperation agreement with Bahrain, and the UK government formally joining the C-SIPA alongside Bahrain and the US.

The 2024 Manama Dialogue welcomed more than 630 delegates from 63 countries, including over 60 government delegations. In line with the IISS Manama Dialogue’s goal of facilitating military and economic cooperation, the IISS facilitated 85 bilateral meetings on the sidelines of the event. Also attending were 24 senior journalists representing major regional and global outlets, alongside a press corps of over 70, providing important coverage and scrutiny. Online, speeches and commentary from this year’s Dialogue Plenaries, Opening Address and Special Keynote Address generated over 15,000 engagements on social media with content reaching an international audience of over 73 million people.

The IISS Manama Dialogue Young Leaders’ Programme was also convened for the sixth time, with 26 carefully selected regional young leaders attending in person.

3. Prague Defence Summit

The IISS convened the inaugural Prague Defence Summit from 8 to 10 November 2024, a major forum for political, military and industry leaders to discuss the most effective ways to build defence capacity in the Euro-Atlantic region. In his Keynote Address to the Summit, President of the Czech Republic General (Retd) Petr Pavel asserted that “maintaining a strong transatlantic bond is not merely a strategic choice, but a necessity. A robust US presence in Europe reinforces NATO’s collective defence and sends a clear message to those who intend to threaten peace.”

The second edition of the Prague Defence Summit took place from 3 to 5 September 2025. In his Keynote Address to the IISS Prague Defence Summit, NATO Secretary General Mark Rutte provided a clear outline of the Alliance’s priorities to increase defence investments and to speed up defence production in the face of serious and lasting threats to transatlantic peace and security. Over 265 delegates attended the 2025 Summit with representation from 30 countries.

4. Lecture Series

The IISS Raffles Lecture series invites major figures in Asian and global affairs to speak on important developments in the Asia-Pacific region, addressing questions of defence, international affairs, geoeconomics and foreign policy. On 20 November 2024, the third IISS Raffles Lecture was given by Sweden’s Foreign Minister, Maria Malmer Stenergard, who discussed Sweden’s shifting policy approach towards the Indo-Pacific against a backdrop of global turbulence, and the opportunities ahead for crossregional collaboration including through Sweden’s recently released national defence policy direction for cooperation with countries in the Indo-Pacific. During the fourth IISS Raffles Lecture on 28 October 2025, Finland’s Minister of Foreign Affairs, H.E. Elina Valtonen outlined Finland’s strategy of ‘comprehensive defence,’ an approach that places equal importance on societal resilience, civil preparedness and the role of the private sector as it does on hard defence capabilities.

Membership

The IISS retains a strong global membership base which comprises a broad spectrum of leading analysts, academics and military and government officials, and international companies. Members are actively connected to international and strategic affairs through access to the Institute’s publicly available research and analysis disseminated via its publications, speaker events, member briefings and international conferences. Individual members are not directly involved in IISS governance, but form part of a unique global network supporting the work of the Institute and extending the Institute’s reach in the world of international affairs. IISS Corporate Membership is designed to enable corporations and

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30 September 2025

institutions to stay on top of world events by giving them a thorough understanding of international affairs, security issues and geopolitical and military conflicts, and to aid their strategic decision-making.

The Institute invites members to participate in discussion meetings at its London headquarters and overseas offices in Washington DC, Manama, Singapore, and Berlin, featuring IISS and guest speakers. Examples of the range of in-person events and webinars held over the past year included:

In a special 'in conversation' event in December 2024, Minister for Foreign Affairs of Australia the Hon. Penny Wong discussed Australia’s foreign policy approach in an uncertain world, focusing on Australia’s deep commitment to Southeast Asia, including its progress in implementing 'Invested: Australia’s Southeast Asia Economic Strategy to 2040'.

In a March event held in Washington, experts examined the key challenges and opportunities in space security and sustainability, focusing on international coordination, governance and the role of great-power competition. Associate Fellow Dr Laurence Rubin was joined by featured experts Mariel Borowitz, Alanna Krolikowski and Bruno Reynaud de Sousa who explored how the private sector drove innovation, shaped policy and governance, and impacted national security in an evolving space environment.

In a June webinar, IISS experts Dr Alexander Bollfrass, Emile Hokayem, Fabian Hinz, Dr Hasan Alhasan and Air Marshal (Retd) Martin Sampson provided a strategic assessment of the Israel–Iran conflict, with a focus on actors’ objectives and capabilities, and implications for the region. They addressed the most pressing questions the conflict poses: How feasible are Israel’s political and military objectives? How much damage have Iran’s nuclear facilities sustained and how quickly would they be able to resume enrichment? For how long can Iran sustain its missile and UAV attacks, and how likely is the regime to survive Israel’s assault? What are the main escalation and de-escalation pathways on the horizon?

Also in June, a webinar held in collaboration with adelphi and as part of London Climate Action Week, brought together the London-based and international investment community along with government and civil-society stakeholders to explore the critical role of finance in supporting and preserving environmentally sensitive regions, while also fostering economic development, reducing conflict over resources, navigating criminal dynamics, and promoting sustainable livelihoods.

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30 September 2025

FINANCIAL REVIEW AND RESULTS FOR THE YEAR

For the year ended 30 September 2025, total income was £33,651,000 (2024: £32,322,000). The primary reason for this variance was convening two Prague Defence Summits within this financial year. Total expenditure for the year rose to £29,525,000, (2024: £25,492,000) with the extra event staging costs.

After accounting for net gains on investment assets of £1,677,000 (2024: £927,000); foreign exchange losses of £90,000 (2024: £219,000); and actuarial losses on the defined benefit pension scheme of £36,000 (2024: £70,000); the net movement in funds for the year was a surplus of £5,677,000 (2024: £7,468,000).

As at 30[th] September 2025 and 2024, there was no liability on the defined benefit pension. Under the most recent actuarial valuation funding plan, the IISS pension scheme is in a surplus position.

Net cash outflow totalled £6,569,000 for the year (2024: £9,357,000 net inflow), leaving total cash balances, including investment portfolio cash, of £9,250,000 at the year-end (2024: £15,819,000). The primary reason for the large variance in cash relates to the investment timing of the new endowment funding in support of the IISS-Asia Senior Fellow for Nuclear Arms Control, Non-Proliferation and Disarmament.

The group reported an improved net current asset position of £4,196,000 (2024: £3,453,000). Total net assets as at 30[th] September 2025 Increased to £39,417,000 (2024: £33,740,000).

Reserves

‘Free reserves’ are defined as unrestricted funds excluding designated funds and funds represented by tangible and intangible fixed assets, other than those financed by external loans. The Institute’s reserves policy has been determined by the Trustees after considering current and projected income streams and the Institute’s expenditure profile. To ensure that the Institute is able to successfully meet its objects, the Trustees aim to hold free reserves equivalent to between 3 and 6 months operating expenditure. This target level of reserves will mitigate the risk of income fluctuations causing delays or cancellations to any expenditure commitments and ensure that planned activities can be completed. Furthermore, in the event of a significant drop in income levels there will be sufficient reserves in place to implement any necessary organisational changes.

At 30 September 2025, the Institute held free reserves of £11,896,000 (2024: £9,291,000) which equated to approximately 6 months (2024: 5.5 months) of operating expenditure associated with unrestricted funds. Free reserves comprise IISS unrestricted general funds of £25,318,000, less tangible and intangible fixed assets of £13,422,000. As at 30 September 2025, IISS restricted funds totalled £11,000 (2024: £82,000) and endowment funds totalled £14,088,000 (2024: £11,146,000) with the addition of a third endowment for a new IISS Korea Chair in Advanced Technologies, National Security and Defence. The Trustees continue to review the reserves policy in line with the Institute’s financial resources.

Investment Policy and Performance

Cazenove Capital Management Ltd. manages the Institute’s UK investment portfolios. The overall investment objective of the main portfolio is to maximise its total return by achieving several percentage points above inflation, in line with constraints over risk. Portfolio performance and asset allocation are closely monitored by the Investment Committee in conjunction with the portfolio managers. The Institute considers this portfolio to be a long-term investment fund and operational cash flow demands are met through operational surpluses. The Investment Committee has adopted a diversified asset allocation strategy in keeping with its appetite for moderate risk. At 30 September 2025, portfolio returns over the previous year, three years, and five years as compared to UK CPI +4% were as follows:

Total Returns	1 year %	3 years p.a. %	5 years p.a. %
Portfolio	11.8	9.4	7.3
Bench(CPI+ 4%)	8.1	8.3	9.4

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30 September 2025

The Institute’s UK Japan Chair expendable endowment fund is invested in a Charity Multi-Asset Fund (CMAF). The CMAF generates an annual pay-out of 4% and enables the Institute to drawdown the approved funds required to meet all costs associated with the Japan Chair research position. As at 30 September 2025, 75% of the Charity Multi-Asset Fund (CMAF) was invested in equities (2024: 72%).

During the year, with the generous support of the Korea Foundation and Hanwha, a new endowment was established for the IISS Korea Chair in Advanced Technologies, National Security and Defence. After consideration by the Investment Committee, the permanent endowment funds received to date have also been invested in the CMAF. Funding will be drawn down on a total return basis to meet Korea Chair staff costs and is complimented by a multi-year grant to support Korea Chair programme activities.

The Institute’s endowment in support of the IISS-Asia Senior Fellow for Nuclear Arms Control, NonProliferation and Disarmament position has been invested with Schroders Asia, as allocated below.

As at 30 September 2025, fund allocations across the portfolios can be summarised as follows:

	Main portfolio	Main portfolio	Japan Chair (CMAF)	Japan Chair (CMAF)	Korea Chair (CMAF)	Senior Fellow for Nuclear Arms Control	Senior Fellow for Nuclear Arms Control
	2025	2024	2025	2024	2025	2025	2024
Asset allocation:
UK equity funds	9%	9%				8%
UK fixed interest funds	9%	8%
International equity funds	66%	62%				62%
International fixed interest funds	3%	5%				29%
Portfolio funds	12%	14%	100%	100%	100%
Cash	1%	2%				1%	100%

The IISS and the Economic Climate

The Institute’s Dialogue activities and publications are protected by multi-year agreements that provide contracted levels of income. As referenced above, the Institute has received expendable endowment funding providing guaranteed financial support for three senior research posts.

The Institute’s commercial trading subsidiary, Arundel House Enterprises Limited (AHEL), experienced much improved trading conditions in relation to its catering and event activities, in addition to strong growth in consultancy and advisory work with an increased emphasis in the advisory offering.

IISS investment portfolio benefited from the strong equity market performance during 2025. The Investment Committee continues to monitor closely its diverse portfolio of investment funds that includes non-sterling denominated exposure in equities and bonds. The Institute naturally hedges its foreign currency transactions, minimising conversion as far as possible to avoid exchange rate losses.

Financial health

As outlined in the Financial Review, the Trustees consider the Institute’s financial health to be sound. At 30 September 2025, the Institute held investment assets totalling £21.8 million and cash of £9m with no loan liabilities, compared to investment assets of £4.6 million, £5 million of cash and a building loan liability of £2.4 million in 2015, demonstrating a clear strengthening in the Institute’s financial position over the past 10 years.

As a result of the income security provided by the diverse revenue sources and multi-year funding arrangements, and in considering budgets and forecasts covering the period to 30 September 2028, the Trustees are confident that the Institute can be considered a going concern for the foreseeable future. Accordingly, there are no material uncertainties surrounding the preparation of the financial statements on a going concern basis. The global nature of IISS operations and funding sources has also contributed towards further income diversity that has helped to mitigate risk during continued economic uncertainty.

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30 September 2025

PRINCIPAL RISKS AND UNCERTAINTIES

The Trustees have assessed the major risks to which the charity is exposed, in particular those related to the operations and finances of the Institute and are satisfied that systems are in place to manage exposure to the major risks.

The most significant potential risks, as identified by the Institute’s Risk Register, are actively managed in the following manner:

Damage to the Institute’s reputation	As reiterated in the Institute’s ‘Statement of Values’ and ‘Policy on financial transparency confidentiality and effectiveness’, the IISS firmly states and demonstrates its commitment to independence and excellence when conducting all activities, with staff training in place to ensure awareness and understanding of the Institute’s policy. Trustees have ultimate oversight over potential donors and funding sources.
A material weakening in the Institute’s financial position and funding levels	Continued efforts to diversify revenue streams to ensure no reliance on one income source. Multi-year agreements are in place for key funders. Liquidity and foreign exchange positions are monitored regularly through cash flow forecasts and external currency specialists. A well-diversified investment portfolio mitigates risk in the event of poor performance of any one asset class. A three- year forecasting and response-planning model is updated regularly and monitored by the Trustees. If circumstances require, IISS will work with funders to adapt grant activities to ensure contractual and funder obligations can be met.
A major failure of the Institute’s IT systems caused by internal or external factors	Principal systems, architecture, and software (including cloud servers, fail-over, disaster recovery, and protective programmes) have been designed drawing on external professional advice to provide best practice stability and security. In recognition of the increasing cyber threat, additional security measures have been introduced to detect and counter attacks.
Failure to maintain the existing high level of Institute staff expertise	Retention measures in place include competitive pay, benefits and working conditions. The competency framework ensures well-structured performance and development reviews. Consulting Fellows and membership base are drawn on when in-house expertise is not available. Adapted working practices have enabled hybrid home and office-based working for staff.

In addition to the review of the risk register by senior management, the Audit Committee and the Trustees, financial performance is evaluated at the Trustee meetings held four times each year. The Institute’s investments and financial resources are monitored by the Investment Committee, which meets four times a year. Ongoing internal controls over these risks, as well as measures to mitigate exposures and financial loss, are exercised on a daily basis by the Institute’s Directing staff.

FUTURE PLANS

Looking ahead, the IISS remains focused on its mission to shape and enable strategic discussion and inter-governmental dialogue, and to provide impartial analysis on major international security issues as a means of informing the public debate and assisting conflict resolution and prevention. The Institute will continue to fulfil this mission through its primary activities of research, dialogues, conferences, lectures, publications, online databases and outreach to governments, the private sector, and the expert and opinion-forming communities. The main objectives for the forthcoming year ending 30th September 2026 are:

Research – the Institute will continue to produce new research and analysis under the rubrics of War, Power and Rules. Under War, the IISS will address the changing shape of armed conflict and

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30 September 2025

military capabilities, cyber power, and the security-development nexus. The IISS will furthermore work on the intersection of national security, innovation and technology. The Power stream will include geo-economics and strategy, the evolving tools of economic statecraft in a multipolar system, and regional security dynamics in Europe, the Middle East and the Indo-Pacific. The Rules stream will address the changing nature of international law, the impact of legal diplomacy exercised by major powers, the emerging regulation of advanced technology with security implications, the rise of economic security in national-security policy and the impact of global geopolitics on the rules-based international order. It will also consider approaches to arms control in the fields of nuclear weapons and uncrewed vehicles.

Digital content – In 2026 the IISS will aim to continue to grow its commercial customers across Military Balance+ and where other opportunities present themselves in government, the private sector and the analytical community to support IISS research and the Institute’s overall mission. Building on recent success with new forms of digital content, such as the ‘Charting’ series and the dashboards being developed, the digital engagement with IISS stakeholders will continue to grow in breadth and depth. The Institute will launch new digital products in 2026, with a focus on complex data and analysis. Partnerships will continue with existing and new external parties and apply new third party technology, in particular AI tools, to support IISS research, publications, and convening work streams. The deeper integration of technology, content and research teams that has come about through continuous digital transformation is paying dividends in digital content which conveys a more dynamic image of the Institute and makes IISS research priorities clearer to external audiences.
Overseas offices – Investment in its international offices and staff remains a priority to ensure that all research activity is infused with both local and regional expertise, yet blended with an international perspective, while also reaching the widest possible audience and engaging a new generation of young analysts internationally. In 2026, the priority of the newest overseas office in Berlin will be to continue deepening IISS engagement with European powers, expanding the IISS analytical footprint in Berlin, and extend IISS convening activity in other European countries, a process that was consolidated in 2025 through the second IISS Prague Defence Summit and inaugural GSIS. The IISS Asia office in Singapore, the IISS Middle East office in Bahrain and the IISS Americas office in Washington, DC will continue to develop strategies to raise further funds and diversify the Institute’s funding base in their respective regions.
Fundraising – During the coming year, the Institute will continue its efforts to identify opportunities for major annual gifts or for the establishment of research endowments at the IISS to support pertinent research positions.

STRUCTURE, GOVERNANCE AND MANAGEMENT

The Institute is governed by Articles of Association lodged with the Registrar of Companies and the Charity Commission for England and Wales.

The Institute’s Articles of Association reflect current best practices and the requirements of the Companies Act 2006 and recognise the fiduciary responsibilities carried by the Institute’s Trustees. Revised Articles of Association were formally lodged with the Charity Commission on 4[th] March 2025.

The Trustees constitute Directors for the purposes of the Companies Act, and act as Trustees for the purposes of the Charities Act. As required by the Articles of Association, all are Members of the Institute. They receive no remuneration for their services. Upon appointment new Trustees are provided with an induction pack, which includes copies of the Institute’s governing documents as well as information about the Institute’s activities and finances. Training is available for all Trustees at any time as required.

In accordance with the Articles of Association, a Trustee can be elected by ordinary resolution or by a decision of the Trustees. A new Trustee may be proposed and considered for election by the existing Trustees. The Trustees delegate the exercise of certain powers in connection with the administration of the Institute as set out below.

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30 September 2025

The Trustees are aware of the Charity Governance Code published in 2020 which sets out the principles and recommended practice for good governance within the sector. The Institute has reviewed its current governance arrangements against the principles within the code and addressed any issues raised where required.

During the year under review, Lord Mark Sedwill was appointed as Chair of the Board of Trustees, succeeding Bill Emmott on 16 July 2025, and Florence Parly took up the position of Vice-Chair on the 19 November 2025, succeeding Dr Chung Min Lee. The Board of Trustees would like to record thanks to both Mr Emmott and Dr Lee for their long service and dedicated support to the IISS.

Audit Committee

The task of monitoring the Institute’s financial control systems and the management of major risk is delegated to the IISS Audit Committee. The current membership of the Audit Committee is: Grace Skaugen (Chair of Committee & Honorary Treasurer) Matthew Symonds Florence Parly

Matt Symonds (appointed 11 February 2025)

Investment Committee

The IISS Investment Committee is empowered to receive advice from the Investment Managers and to vary the investment policy at any time. The current membership of the Investment Committee is: Dr Grace Skaugen (Chairman of Committee & Honorary Treasurer) Matthew Symonds

Matt Symonds (appointed 11 February 2025)

Trustee Remuneration and Employment Committee

The IISS Remuneration Committee is responsible for the annual review of the Director-General and Chief Executive’s remuneration package, with oversight of the Institute’s overall human resources policies. The current membership of the Remuneration Committee is:

Lord Mark Sedwill (Chair of Committee and Chair of the IISS Trustees) Dr Grace Skaugen (Honorary Treasurer) Caroline Atkinson Neha Aviral

Nominations Committee

The IISS Nominations Committee is responsible for proposing new Trustees to the Board. The current membership of the Nominations Committee is:

Lord Mark Sedwill (Chair of Committee and Chair of the IISS Trustees) Florence Parly (Vice Chair of the IISS Trustees) Matthew Symonds Kasper Rorsted

Director-General and Chief Executive

The Director-General and Chief Executive is responsible for the day-to-day management of the Institute’s affairs and for implementing policies agreed by the Trustees. The Director-General and Chief Executive is assisted by senior management.

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30 September 2025

Remuneration Policy

The IISS’s remuneration policy and practices reflect the Institute’s objectives of good governance combined with the need to attract and retain the best talent internationally. This policy aims to support the sustained growth and development of the Institute and its employees and to ensure that the Institute is able effectively to carry out its mission to provide objective information and analysis on geopolitical change as well as facilitate conflict resolution and the maintenance of international peace and security.

The Institute’s Staff Remuneration Committee, which consists of the Director-General and Chief Executive; the Director of Finance; and the Director of Human Resources, carries out promotion decisions and an annual salary review with increases awarded for individual performance linked to a ‘competency framework’. This review incorporates IISS key management personnel, with the exception of the Director-General and Chief Executive and Executive Chairman. Salaries and benefits are positioned between the upper end of the charitable sector and middle of the corporate sector to ensure the Institute can compete globally in recruiting and retaining talent from the private sector, governments, and the international expert community. A review of market rates with reference to available salary surveys and monthly competitor research is undertaken regularly.

As referenced above, the IISS Trustee Remuneration and Employment Committee annually reviews the remuneration package of the Director-General and Chief Executive and the Institute’s overall human resources policies, including salary rates and staff benefits. Remuneration packages may consist of fixed elements such as salary, pension, life assurance and private medical insurance; and a variable element of a discretionary performance-based bonus payment. Employee benefits are reviewed annually.

The Trustees are invited to approve annually the staffing and salary budget and forecast for the year. This includes senior management. No Trustees are remunerated but travel expenses are reimbursed.

Public Benefit

The Trustees have given due consideration to the Charity’s Commission’s published guidance on the Public Benefit Requirement under the Charities Act 2011.

The beneficiaries of the Institute include individuals and organisations within the political, diplomatic, defence and academic fields, the public in general, international agencies and governments worldwide. The interests and concerns of these groups are constantly evolving, and the charity's development is influenced by the need to continue to address their current interests and concerns. As clearly evidenced in this report, the Institute has successfully reached these audiences during the year under review.

In the UK, the Institute’s staff have regularly provided facts and evidence-based analysis on geo-strategic and geo-economic trends to key members of the expert media, parliamentarians, civil servants and ministers. Internationally, the Institute has provided unique defence diplomatic platforms in the Middle East and Asia that have facilitated high level consultations on defence issues and conflict resolution that has also engaged Europeans and North Americans. It has published evidence-based research that numerous governments have found added value to their internal assessments. The Institute has also briefed various inter-governmental organisations, including NATO and the EU, on important issues of public policy and has provided evidence to a number of parliamentary enquiries. It continues to put into the public domain the best available information on a wide range of international issues to ensure a more informed public debate.

Group Structure

IISS Middle East

The IISS Middle East branch office in Manama, Bahrain was established as a base for the Institute’s many research programmes and activities throughout the region and serves to connect IISS activities in Europe, North America and Asia with those in the Middle East. Since its foundation in May 2010, the office has built a strong cohort of experts and administrative staff who work closely with the entire IISS

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30 September 2025

global network to provide not just first-class information and analysis on Middle East and broader international strategic issues but also strengthen links between the strategic community in the Middle East and those in other parts of the world.

Since 2004 the IISS has held annually the IISS Regional Security Summit: The Manama Dialogue in Bahrain. Full details of the Dialogue can be found on page 7.

The International Institute for Strategic Studies – US (IISS-Americas)

IISS-Americas is a branch of the IISS located in Washington DC. During the year, IISS-Americas continued its efforts to engage and expand the IISS membership base in the region, promote IISS activities and research to a North American audience of government leaders and policy shapers, and cultivate relationships with US policy makers to ensure strong US representation at the dialogues. The office held both in-person and hybrid events to continue outreach to a global audience. This has reinforced the reputation of IISS-Americas as representing a vibrant, international, intellectual community.

Arundel House Enterprises Limited (AHEL)

AHEL is a wholly owned trading company with revenue arising from the letting of facilities and provision of event catering at Arundel House and the provision of Consultancy and Advisory services. The company reported a profit for the year of £593,000 before gift aid (2024: £356,000).

The International Institute for Strategic Studies (Asia) Limited (IISS-Asia) and the Strategic Studies Fund (SSF)

IISS-Asia is a company limited by guarantee registered in Singapore. In January 2025, IISS-Asia again convened the IISS Shangri-La Dialogue Sherpa Meeting, an important inter-sessional activity of the Shangri-La Dialogue process. As detailed on page 7, the Shangri-La Dialogue was held from 30 May to 1 June 2025, whilst the Raffles Lecture series continued during the year under review.

Notably, IISS-Asia research staff edited the annual Asia-Pacific Regional Security Assessment and organised and participated in IISS webinars on Asia-Pacific security. IISS-Asia also took the lead in recruiting and servicing IISS members in Singapore and the wider Asia-Pacific region.

The SSF is a trust fund established in Singapore for the purpose of raising funds to be applied in Singapore towards activities relevant to the objectives of the Institute and of benefit to the Singapore community. The Fund ceased operations on 30 September 2025 and is in the process of winding up.

The results for IISS-Asia and the SSF are consolidated on the basis that the Institute holds a majority of the voting rights in IISS-Asia and has ultimate discretion over the disbursement of SSF funds and over its activities.

IISS India Organisation – (IISS-India)

During the year under review, IISS-India, a non-profit subsidiary of IISS with its registered office in New Delhi, was wound up.

IISS Europe gemeinnützige GmbH (IISS-Europe)

IISS-Europe was incorporated as a non-profit subsidiary of IISS on 4 November 2019, with its registered office in Berlin, established to deepen IISS engagement with European powers, expand its analytical footprint in Germany and play an active part in shaping the security and defence debate in Germany and the EU. The IISS-Europe office includes research and operational staff in support of a broad five-year research programme on ‘Power shifts and the evolving international order: Strategic challenges for Germany and Europe’.

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30 September 2025

Statement of Trustees’ Responsibilities

The Trustees (who are also directors of The International Institute for Strategic Studies for the purposes of company law) are responsible for preparing the Report of the Trustees and the financial statements in accordance with applicable law and accounting standards (FRS102).

Company law requires the Trustees to prepare financial statements for each financial year. Under company law the Trustees must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the charitable company and the group and of the incoming resources and application of resources, including the income and expenditure, of the group for that period. In preparing these financial statements, the Trustees are required to:

select suitable accounting policies and then apply them consistently;
observe the methods and principles in the Charities SORP;
make judgments and estimates that are reasonable and prudent;
state whether applicable UK accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements; and
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the charitable company will continue in business.

The Trustees are responsible for keeping adequate accounting records that are sufficient to show and explain the charitable company’s transactions, disclose with reasonable accuracy at any time the financial position of the charitable company and enable them to ensure that the financial statements comply with the Companies Act and the provisions of the charity’s constitution. They are also responsible for safeguarding the assets of the charity and the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

So far as each of the Trustees at the date of this report is aware, there is no relevant audit information of which the charity’s auditor is unaware. Each Trustee has taken all the steps that he/she ought to have taken as a Trustee in order to make himself/herself aware of any relevant audit information and to establish that the charity’s auditor is aware of that information.

Corporate Governance

Processes are in place to ensure that performance is monitored and that appropriate management information is prepared and reviewed regularly by both the executive management and the Trustees.

The systems of internal control are designed to provide reasonable, but not absolute, assurance against material misstatement or loss. They include:

an annual budget approved by the Trustees;
regular consideration by the Trustees of both financial and non-financial results; and
delegation of day-to-day management authority and segregation of duties.

Auditors

Crowe U.K. LLP has indicated its willingness to be reappointed as statutory auditor.

The Strategic Report and Report of the Trustees was approved by the Trustees in their capacity as Company Directors on 29 January 2026 and signed on their behalf by:

Lord Mark Sedwill Chair of the Trustees

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30 September 2025

REFERENCE AND ADMINISTRATIVE DETAILS

The International Institute for Strategic Studies , also known as the IISS, is a registered charity and a company limited by guarantee. The liability of each Board of Trustees member under the guarantee does not exceed the sum of £1.

Registered Office	Arundel House
	6 Temple Place
	London
	WC2R 2PG
Company Number	615259
Charity Number	206504
Trustees
*Chair*	Lord Mark Sedwill (Chair from 16 July 2025)
	Bill Emmott (Chair until 16 July 2025; resigned 19 November 2025)
*Vice-Chair*	Florence Parly (Vice-Chair from 19 November 2025)
	Dr Chung Min Lee (resigned 19 November 2025)
*Hon Treasurer*	Dr Grace Skaugen (Hon Treasurer from 21 November 2024)
	Chris Jones (resigned 21 November 2024)
	Matthew J Symonds
	Caroline Atkinson
	John Brennan
	Neha Aviral
	Hakeem Belo-Osagie
	Kasper Rorsted
	Matt Symonds (appointed 11 February 2025)

During the year under review, Chris Jones resigned from the Board on 21 November 2024 and Matt Symonds was reappointed to the Board with effect from 11 February 2025.

Subsequent to the year-end, Bill Emmott and Chung Min Lee resigned from the Board on 19 November 2025.

For the purposes of clarity, there are two Trustees on the Board of Trustees named Matthew Symonds.

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30 September 2025

Executive Directing Staff

Director-General and Chief Executive Dr Bastian Giegerich Director of Geo-Economics; Japan Chair Robert Ward Director of Regional Security Emile Hokayem Director of Finance Sally Taylor Director of Operations Dr John Hobart Director of HR Jane Graham Director of Editorial Services and Digital Strategy David Tomchak Executive Director, IISS-Asia Veerle Nouwens Executive Director, IISS-Middle East Martin Sampson Executive Director, IISS-Europe Dr Ben Schreer Corresponding Executive Director, IISS-Americas Sir Thomas Beckett

Agents and Advisers

Legal Advisers Stone King Sewell LLP, 13 Queen Square, Bath BA1 2HJ Bankers HSBC Bank plc, 60 Queen Victoria Street, London EC4N 4TR Investment Managers Cazenove Capital Management (part of Schroder & Co. Limited), 12 Moorgate, London EC2R 6DA Schroders Wealth Management, 138 Market Street, #23-02 CapitaGreen, Singapore 048946 Pension Fund Managers Mobius Life, 7th Floor, 20 Gresham Street, London EC2V 7JE Pension Consultants / Actuary Mercer, The St Botolph Building, 138 Houndsditch, London EC3A 7AW Pension Administrators Aptia, Maclaren House, Talbot Road, Stretford, Manchester, M32 0FP Auditor Crowe U.K. LLP, 2[nd] Floor, 55 Ludgate Hill, London EC4M 7JW

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30 September 2025

Independent Auditor’s Report to the Members of The International Institute for Strategic Studies

Opinion

We have audited the financial statements of The International Institute for Strategic Studies (the charitable company’) and its subsidiary (the group’) for the year ended 30 September 2025 which comprise the Consolidated Statement of Financial Activities, Consolidated and Charity Balance Sheets, Consolidated Cash Flow Statement and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

give a true and fair view of the state of the group’s and the charitable company’s affairs as at 30 September 2025 and of the group’s income and receipts of endowments and expenditure, for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the Trustee's use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the charitable company's or the group’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the Trustees with respect to going concern are described in the relevant sections of this report.

Other information

The Trustees are responsible for the other information contained within the annual report. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30 September 2025

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion based on the work undertaken in the course of our audit

the information given in the Trustees’ report, which includes the directors’ report and the strategic report prepared for the purposes of company law, for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors’ report included within the Trustees’ report have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In light of the knowledge and understanding of the group and charitable company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors’ report included within the Trustees’ report.

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

adequate and proper accounting records have not been kept; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of trustees' remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.

Responsibilities of trustees

As explained more fully in the Trustees’ responsibilities statement, the Trustees (who are also the directors of the charitable company for the purposes of company law) are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the Trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the Trustees are responsible for assessing the charitable company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Trustees either intend to liquidate the charitable company or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

Details of the extent to which the audit was considered capable of detecting irregularities, including fraud and non-compliance with laws and regulations are set out below.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

Extent to which the audit was considered capable of detecting irregularities, including fraud

Irregularities, including fraud, are instances of noncompliance with laws and regulations. We identified and assessed the risks of material misstatement of the financial statements from irregularities, whether

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30 September 2025

due to fraud or error, and discussed these between our audit team members. We then designed and performed audit procedures responsive to those risks, including obtaining audit evidence sufficient and appropriate to provide a basis for our opinion.

We obtained an understanding of the legal and regulatory frameworks within which the charity and group operates, focusing on those laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements. The laws and regulations we considered in this context were the Companies Act 2006, the Charities Act 2011, together with the Charities SORP (FRS 102). We assessed the required compliance with these laws and regulations as part of our audit procedures on the related financial statement items.

In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which might be fundamental to the charity’s and group’s ability to operate or to avoid a material penalty. We also considered the opportunities and incentives that may exist within the charity and the group for fraud. The laws and regulations we considered in this context for the UK operations were taxation legislation, employment legislation and General Data Protection Regulation (GDPR). We also considered compliance with local legislation for the group’s overseas operating segments.

Auditing standards limit the required audit procedures to identify non-compliance with these laws and regulations to enquiry of the Trustees and other management and inspection of regulatory and legal correspondence, if any.

We identified the greatest risk of material impact on the financial statements from irregularities, including fraud, to be within the timing surrounding recognition income and the override of controls by management. Our audit procedures to respond to these risks included enquiries of management, and the audit committee about their own identification and assessment of the risks of irregularities, sample testing on the posting of journals, reviewing accounting estimates for biases, reviewing regulatory correspondence and reading minutes of meetings of those charged with governance.

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed noncompliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. In addition, as with any audit, there remained a higher risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.

Use of our report

This report is made solely to the charitable company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the charitable company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charitable company and the charitable company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

Nicola May Senior Statutory Auditor For and on behalf of Crowe U.K. LLP Statutory Auditor London Date 13 February 2026

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30[th] September 2025

CONSOLIDATED STATEMENT OF FINANCIAL ACTIVITIES (incorporating an income and expenditure account)

Year ended 30[th] September 2025

Notes Income from: Donations 2 Charitable activities Dialogues, conferences and lecture series 3 Research programmes 3 Publications Membership Other trading activities 3 Investments Capital applied to income Other income Total Expenditure on: Raising funds Charitable activities Dialogues, conferences and lecture series 4 Research programmes 4 Publications 4 Membership 4 Other trading activities Total Net gains on investments Net income / (expenditure) Transfers between funds 12 Other recognised gains/(losses): Foreign exchange (losses) / gains Actuarial losses on defined benefit pension schemes Net movement in funds Funds brought forward at 1 October 2024 12 Funds carried forward at 30 September 2025 12,13	Unrestricted Funds £'000 3,509 13,187 1,632 1,862 2,086 2,544 121 - 360 25,301 67 10,687 5,845 4,154 757 1,656 23,166 680 2,815 (15) 27 (36) 2,791 22,512 25,303	Restricted Funds £'000 - - 5,718 - - - 344 220 6 6,288 - - 6,359 - - - 6,359 - (71) 15 - - (56) 82 26	Endowed Funds £'000 2,282 - - - - - - (220) - 2,062 - - - - - - - 997 3,059 - (117) - 2,942 11,146 14,088	Total Funds Total Funds 2025 2024 £'000 £'000 5,791 9,555 13,187 10,436 7,350 7,065 1,862 1,516 2,086 2,058 2,544 1,018 465 420 - - 366 254 33,651 32,322 67 53 10,687 7,418 12,204 12,323 4,154 4,347 757 688 1,656 663 29,525 25,492 1,677 927 5,803 7,757 - - (90) (219) (36) (70) 5,677 7,468 33,740 26,272 39,417 33,740

All amounts relate to continuing operations and, as all gains and losses are included, a separate statement of total recognised gains and losses has not been presented.

The notes on pages 27 to 48 form part of these accounts

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30th September 2025

CONSOLIDATED BALANCE SHEET (Company Number 615259)

As at 30[th] September 2025

Notes Fixed assets Intangible assets 6 Tangible assets 7 Investments 8 Total Fixed assets Current assets: Debtors 9 Cash at bank and in hand Total Current assets Liabilities: Creditors: Amounts falling due within one year 10 *Net current assets* *Total assets less current liabilities* *Net assets excluding pension liability* Defined benefit pension liability 14 Total net assets 13 The Funds of the charity Expendable endowment funds 12 Restricted income funds 12 Unrestricted income funds 12 Pensions reserve 12 Total unrestricted funds 13 Total group funds 13	2025 £'000 452 12,970 21,799 35,221 4,282 9,003 13,285 (9,089) *4,196* *39,417* *39,417* - 39,417 14,088 26 25,303 0 25,303 39,417	2024 £'000 468 12,753 17,066
		30,287
		3,248 9,670
		12,918
		(9,465)
		3,453 33,740
		33,740 -
		33,740
		11,146 82 22,512 0
		22,512
		33,740

The consolidated balance sheet includes the assets, liabilities and funds of The International Institute for Strategic Studies (Asia) Limited, Arundel House Enterprises Limited, IISS Europe gemeinnützige GmbH, and the Strategic Studies Fund.

The accounts were approved and authorised for issue by the Trustees on 29 January 2026 and signed on their behalf by:

Lord Mark Sedwill Chair of the Trustees

The notes on pages 27 to 48 form part of these accounts

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30th September 2025

CHARITY BALANCE SHEET (Company Number 615259)

As at 30th September 2025

Notes Fixed assets Intangible assets 6 Tangible assets 7 Investments 8 Total Fixed assets Current assets: Debtors 9 Cash at bank and in hand Total Current assets: Liabilities Creditors: amounts falling due within one year 10 *Net current assets* *Total assets less current liabilities* *Net assets excluding pension liability* Defined benefit pension liability 14 Total net assets The Funds of the charity Expendable endowment funds 12 Restricted income funds 12 Unrestricted funds 12 Pensions reserve 12 Total unrestricted funds 13 Total funds including pensions reserve 13	2025 £'000 452 12,873 15,508 28,833 4,389 5,220 9,609 (5,893) 3,716 32,549 32,549 0 32,549 7,823 16 24,710 0 24,710 32,549	2024 £'000 469 12,596 11,053
		24,118
		2,903 3,889
		6,792
		(5,506)
		1,286 25,404
		25,404 0
		25,404
		5,144 38 20,222 0
		20,222
		25,404

The unconsolidated surplus incurred by the Charity in 2025 was £6,586,000 (2024: surplus £1,179,000)

The accounts were approved and authorised for issue by the Trustees on 29 January 2026 and signed on their behalf by:

Lord Mark Sedwill Chair of the Trustees

The notes on pages 27 to 48 form part of these accounts

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30th September 2025

CONSOLIDATED STATEMENT OF CASH FLOW

Year ended 30th September 2025

2025 Notes £'000 Cash flows from operating activities: *Net cash provided by operating activities* A Cash flows from investing activities: Dividends, interest and rents from investments 465 Purchase of property, plant and equipment (815) Proceeds from sales of property, plant and equipment - Purchase of software and website costs (255) Purchase of investments (12,381) Proceeds from sales of investments 3,222 *Net cash (used in) provided by investing activities* *Net cash provided by (used in) financing activities* *Change in cash and cash equivalents in the year* *Cash and cash equivalents at the beginning of the reporting period* *Cash and cash equivalents at the end of the reporting period* B NOTES TO THE STATEMENT OF CASH FLOW A *Reconciliation of net incoming resources to net cash inflow from operating activities* Net income for the reporting period (as per the statement of financial activities) Adjustments for: Dividends and interest from investments Depreciation charges Amortisation charges Pension reserve deficit funding (Gains) on investments Exchange losses/ (gains) on fixed assets Change in cash and cash equivalents due to exchange rate movements (Increase)/ Decrease in debtors Increase/(Decrease) in creditors Net cash provided by (used in) operating activities B *Analysis of cash and cash equivalents* Cash at bank and in hand Portfolio cash	2025 £'000 3,195 (9,764) - (6,569) 15,819 9,250 2025 £'000 5,803 (465) 604 271 (36) (1,677) (6) 111 (1,034) (376) 3,195 2025 £'000 9,003 247 9,250	2024 £'000 420 (244) - (137) (2,000) 2,110	2024 £'000 9,208 149 -
			9,357 6,462
			15,819
			2024 £'000 7,757 (420) 601 253 (70) (927) 21 (219) 1,776 436
			9,208
			2024 £'000 9,670 6,149
			15,819

The notes on pages 27 to 48 form part of these accounts

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30th September 2025

NOTES TO THE FINANCIAL STATEMENTS

1 Accounting policies

a) Status

The Institute is a registered charity and a company limited by guarantee, incorporated in England and Wales. Its registered office address is Arundel House, 6 Temple Place, London WC2R 2PG. The Trustees constitute Directors for the purposes of the Companies Act and act as Trustees for the purposes of the Charities Act. The charity is a Public Benefit Entity.

b) Accounting convention

The accounts of the Charity and the Group have been prepared under the historical cost convention as modified by the revaluation of investments and in accordance with FRS102. The accounts are prepared in accordance with the Companies Act, and the current Statement of Recommended Practice: ‘Accounting and Reporting by Charities’ (SORP). The functional and reporting currency of the Group is GBP.

Basis of consolidation

The accounts include the assets, liabilities and funds, and the statement of financial activities of the charity and its subsidiary undertakings. Subsidiaries' activities are consolidated on a line by line basis. A separate statement of financial activities has not been prepared for the Charity alone as permitted by Section 408 of the Companies Act 2006.

Going concern

After making enquiries, the Trustees have reasonable expectation that the charity has adequate resources to 5803 continue its activities for the foreseeable future, and are satisfied that there are no material uncertainties surrounding the ability of the group to continue as a going concern. Accordingly, they continue to adopt the going concern basis in preparing the financial statements as outlined in the Trustees' Report above.

Critical accounting judgements and key sources of estimation uncertainty

In the application of the group’s accounting policies, which are described in this note, trustees are required to make judgements, estimates and assumptions about the carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and underlying assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects the current and future periods.

Significant areas of estimate and judgement include provisions, income recognition, and assumptions used to value the defined benefit pension scheme and the remaining useful life of assets. Related accounting policies for these items are noted below. The principal accounting policies adopted, judgements and key sources of estimation uncertainty in the presentation of the financial statements are as follows: 9250.154

c) Investments

All investments are valued at their mid-market value at the balance sheet date, which gives rise to unrealised gains and losses. The differences between the carrying value (or cost if acquired during the year) and the proceeds of liquidated investments are identified as realised investment gains or losses. Realised and unrealised gains and losses are presented net in the Statement of Financial Activities.

Investment income and related tax credits are accounted for when received.

d) Restricted funds

Restricted funds are funds subject to specific restrictive conditions imposed by donors or by the purpose of the funds raised.

e) Expendable Endowment funds

The expendable endowment fund is treated as capital until the right to transfer funds to income and expend in accordance with the donor conditions has been granted.

f) Tangible fixed assets and depreciation

Furniture, fittings and equipment acquisitions are stated at cost. Freehold buildings are stated at cost. Depreciation is charged when assets are brought into use. The following depreciation policies are applied consistently across the group over the useful economic lives of the assets on a straight line basis:

i) Computers, printers and other electronic equipment with functional unit costs in excess of £1,000 are depreciated over a period of three years.
ii) Furniture, fittings and equipment of a non-electronic nature with unit costs in excess of £250 are depreciated over a period of five years.

iii) Plant and machinery items with unit costs in excess of £1,000 are depreciated over a period of ten years. iv) Leasehold improvements with unit costs in excess of £1,000 are depreciated over the life of the lease.

v) Freehold Building improvements with unit costs in excess of £1,000 are depreciated over a period of fifteen years.

vi) Freehold building depreciation is charged at 1% using the straight line basis.

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30th September 2025

g) Intangible fixed assets and amortisation

Website costs and software acquisitions are stated at cost. Amortisation is charged when assets are brought into use. The following amortisation policy is applied consistently across the group:

i) Software and website costs in excess of £1,000 are depreciated over their useful economic lives on a straight line basis over a period of three years.

No amortisation is charged on assets in the course of development.

h) Debtors

Debtors are stated in the balance sheet at estimated net realisable value, being the invoiced amount less any provision for bad and doubtful debtors. Provisions are made specifically against debtors where there is evidence of a dispute or an inability to pay. An additional provision is made against older balances.

i) Cash at bank and in hand

Cash includes cash-in-hand, cash-at-bank and bank overdrafts. Bank loans are included within Creditors.

j) Creditors

Trade and other creditors: Trade and other creditors are stated at cost.

k) Foreign currency

Assets and liabilities denominated in foreign currencies are translated into sterling at the rate of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate ruling at the date of the transaction. Exchange differences are taken to the Statement of Financial Activities. Foreign currency subsidiaries are translated into UK£ Sterling on the following basis:

assets and liabilities are translated at the closing rate at the balance sheet date; - income and expenses are translated at average exchange rates for the financial year; and - all resulting exchange differences are taken to the Statement of Financial Activities.

l) Publications and membership income

Publications revenue advanced to the Institute under agreement with the publishers is recognised during the financial year in which the sale arises. An estimate of additional royalty income due up to 30 September 2025, to be received in early 2026, has been made in these financial statements.

Membership income is recognised on the subscription period start date. Any income invoiced in advance of the subscription period start date is deferred and recognised in the relevant accounting year.

m) Grants

Research grants are credited to the Statement of Financial Activities in accordance with the progress and performance of the grant programme activities. Income for Dialogues is recognised to the extent that the event has been planned and progress work completed in line with the contract.

When donors specify that grants are for particular restricted purposes, this income is included in incoming resources of restricted funds.

n) Deferred income

Income is deferred to future periods where the donor has placed an external restriction that the income should be used in those future periods or where the Institute has not fully earnt entitlement to that income.

o) Expenditure

Expenditure is classified under the principal categories of Raising Funds, Charitable Activities, Commercial Activities Operating Expenditure and Financing Costs.

Charitable activities costs comprise all expenditure directly related to the objects of the Institute including direct staff costs attributable to each activity, together with a corresponding apportionment of central support costs.

Support costs are apportioned to charitable activities by a method based on the average headcount of employees allocated to each activity for the financial year.

Knowledge and Information expenses are included within support costs.

Financing Costs comprise those costs directly attributable to investment managers' fees/commissions and borrowing costs incurred in relation to financing.

Raising Funds comprise those costs directly attributable to fundraising activities.

Other Trading Activities Operating Expenditure comprise all costs incurred by Arundel House Enterprises Limited in delivering its catering, event and consultancy activities.

Expenditure is accounted for on an accruals basis.

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30th September 2025

p) Leasing

Rental costs under operating leases are charged to the Statement of Financial Activities in equal amounts over the period of the leases.

q) Pension costs

The Institute maintains a contributory defined benefit pension scheme which was closed to new entrants in 2001. The assets of the scheme are held separately from those of the Institute being invested in managed funds. The pension scheme is accounted for in accordance with FRS102 Retirement Benefits.

The Institute has defined contribution pension schemes which are open to all employees and also contributes to the personal pensions of some employees. Contributions to the scheme are accounted for when payable. Further details of all pension schemes can be found in Note 14.

r) Redundancy and termination payments

Redundancy and termination payments only occur when absolutely necessary as the Institute seeks to minimise organisational change. When redundancy or termination payments do arise, they are charged on an accruals basis and included with Staff Costs.

s) Knowledge and Information Services

The Knowledge and Information Services (formerly the Library) holds a comprehensive collection of books, journals, pamphlets and online resources covering a broad range of current international relations, security and defence topics. The collection is regularly updated for continued use by IISS research staff. New publications are expensed through the SoFA and the library does not hold any valuable publications which may require inclusion on the Balance Sheet.

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30th September 2025

2 Donations Unrestricted Restricted Endowed 2025 £'000 £'000 £'000 £'000 Donation in support of the IISS-Middle East office and related research activities 3,352 3,352 Donation for an endowment fund for new IISS-Asia Senior Fellow for Nuclear Arms Control - Donation for an endowment fund for Korea Chair Senior Fellow 2,282 2,282 Other 157 157 3,509 - 2,282 5,791 3 i) Dialogues, conferences and lecture series Unrestricted Restricted 2025 £'000 £'000 £'000 Manama Dialogue 4,120 4,120 Shangri-La Dialogue 6,080 6,080 Prague Defense Summit 2,647 2,647 GSIS Hamburg 219 219 Lecture series 121 121 13,187 - 13,187 Funding for dialogues, conferences and lecture series received during the year from UK and international Governments totalled ££10,851,000 (2024: £8,171,000).	Unrestricted £'000 3,352 157 3,509	Restricted £'000 - Unrestricted £'000 4,120 6,080 2,647 219 121 13,187	Endowed £'000 2,282 2,282 Restricted £'000 -	2025 £'000 3,352 - 2,282 157 5,791 2025 £'000 4,120 6,080 2,647 219 121 13,187	2024 £'000 3,452 6,003 100
					9,555
					2024 £'000 3,849 5,927 381 279
					10,436

3 ii) Research programmes South and Central Asian Defence, Strategy and Diplomacy Strategy, Technology and Arms Control Europe Defence & Military Analysis Conflict, Security & Development Geo-Economics & Strategy Middle East Southeast Asian Politics and Foreign Policy Indo-Pacific Defence and Strategy Cyber Power and Future Conflict Japan Chair China Other Research Programmes	Unrestricted £'000 11 - - 333 - - - - 1,163 - - 10 115 1,632	Restricted £'000 984 137 - 1,372 849 79 88 203 389 1,171 112 277 57 5,718	2025 2024 £'000 £'000 995 1,734 137 146 - 153 1,705 1,547 849 469 79 8 88 80 203 255 1,552 1,723 1,171 766 112 43 287 - 172 141 7,350 7,065

Funding for research projects received during the year from UK and international Governments totalled £5,392,000 (2024: £5,844,000)

3 iii) Other trading activities

Other trading activities include event catering at its Arundel House venue, the sale of digital publications, and the provision of consultancy and advisory services providing strategic advice and political risk analysis to a range of government and commercial clients.

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30th September 2025

4 i) Analysis of expenditure - charitable activities and governance

Group

Charitable activities Primary costs Dialogues and conferences Research programmes Publications Membership Support costs Support operations Total 2025 Total 2024	Staff costs £'000 2,600 5,167 1,743 274 5,182 14,966 13,906	Other direct costs £'000 6,131 3,052 135 30 2,781 12,129 9,936	Depreciation charges £'000 - 15 22 - 774 811 853	Exchange (gains) /losses £'000 - - - (2) (102) (104) 81	Allocation of support costs £'000 1,956 3,970 2,254 455 (8,635) - -	Total 2025 £'000 10,687 12,204 4,154 757 - 27,802	Total 2024 £'000 7,418 12,323 4,347 688 -
							24,776 24,776

The above table analyses by expense category the costs related to the charit ~~able activitie~~ s ~~and the go~~ vernance of the Institute. Charitable activities costs include both primary costs, which are directly attributable to specific charitable activities, and centrally incurred support costs. The total support costs are then apportioned across the specific activities in accordance with the average headcount of employees allocated to each activity for the financial year. Costs relating to commercial activities are not included in the above table.

Included in support costs for 2025 are governance costs of £202,000 (2024: £211,000). Governance costs include staff costs, trustee travel to board meetings and audit fees.

Staff costs include amounts paid to consulting fellows and other consulting associates not on the payroll, so will be higher than salaries and wages costs included in Note 5.

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30th September 2025

4 ii) Net Income/ Expenditure

Net income/ expenditure is stated after charging:
Depreciation
Amortisation
Auditors' remuneration
- Audit fees
- Tax advisory and other services
Operating leases
- Land and buildings
Trustees' professional indemnity insurance
Staff costs
Wages and salaries
Social security costs
Employers' contribution to defined contribution pension schemes
Operating costs of defined benefit pension schemes (excluding finance costs)
Other forms of employee benefits

2025
2024
£'000
£'000
604
601
271
253
41
37
6
3
1,378
1,424
26
29
2025
2024
£'000
£'000
12,617
11,209
1,366
1,103
554
465
50
35
654
544
15,241
13,356

5 Staff costs

Costs of Consulting Fellows and other sub-contractors totalling £931,000 (2024: £973,000) are not included in the figures above.

Wages and salaries include £3,422,000 (2024: £4,846,000) in respect of restricted grant funded staff salaries. Remuneration of key management personnel totalled £3,060,000 during the year (2024: £2,992,000). No Redundancy payments were paid during the year (2024: nil).

The average number of employees (headcount) during the year

Dialogues and conferences Research programmes Publications Commercial Activities Membership Support Number of employees whose emoluments were over £60,000 £590,001 to £600,000 £480,001 to £490,000 £450,001 to £460,000 £360,001 to £370,000 £220,001 to £230,000 £210,001 to £220,000 £200,001 to £210,000 £190,001 to £200,000 £180,001 to £190,000 £170,001 to £180,000 £150,001 to £160,000 £140,001 to £150,000 £130,001 to £140,000 £120,001 to £130,000 £110,001 to £120,000 £100,001 to £110,000 £90,001 to £100,000 £80,001 to £90,000 £70,001 to £80,000 £60,001 to £70,000	No. 20 52 37 9 7 54 179 No. - 1 1 - 1 2 1 1 - - 4 1 2 6 4 6 8 8 3 17 66	No. 16 50 36 4 6 51
		163
		No. 1 - - 1 1 - 1 1 1 1 - 4 2 5 1 7 6 8 7 8
		55

None of the above employees (2024: none) are accruing retirement benefits under the defined benefit scheme. 52 of the above employees (2024: 47) are accruing retirement benefits under money purchase schemes, and contributions on their behalf amounted to £372,000 (2024: £340,000).

For staff who are directly attributable to specific charitable activities (including both restricted and unrestricted funds), the pension costs are allocated on the same apportionment basis as their staff time/salaries. Support staff pension costs are apportioned on a headcount basis, outlined in note 4.i.

31 32

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30th September 2025

6 Intangible fixed assets

Group Cost At 1 October 2024 Exchange differences on consolidation Disposals Additions At 30 September 2025 Amortisation At 1 October 2024 Exchange differences on consolidation Eliminated on disposals Charge for the year At 30 September 2025 Net book value At 30 September 2025 At 30 September 2024	Software and Website costs £'000 2,318 - (80) 255 2,493 1,850 - (80) 271 2,041 452 468	Total £'000 2,318 - (80) 255
		2,493
		1,850 - (80) 271
		2,041
		452
		468

Projects under development total £206,000 (2024 £41,000) in relation to Finance system change, Website upgrade and CCTV upgrades. These are treated as Assets under construction and are not amortised until they are in use. We expect these to come into use in the first quarter of 2026.

Charity Cost At 1 October 2024 Exchange differences on consolidation Disposals Additions At 30 September 2025 Amortisation At 1 October 2024 Exchange differences on consolidation Eliminated on disposals Charge for the year At 30 September 2025 Net book value At 30 September 2025 At 30 September 2024	Software and Website costs £'000 2,297 - (63) 255 2,489 1,829 - (63) 271 2,037 452 468	Total £'000 2,297 - (63) 255
		2,489
		1,829 - (63) 271
		2,037
		452
		468

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30th September 2025

7 Tangible fixed assets

Group Cost At 1 October 2024 Exchange differences on consolidation Disposals Additions At 30 September 2025 Depreciation At 1 October 2024 Exchange differences on consolidation Eliminated on disposals Charge for the year At 30 September 2025 Net book value At 30 September 2025 At 30 September 2024	Freehold land £'000 3,000 - - - 3,000 - - - - - 3,000 3,000	Freehold buildings £'000 11,456 - - - 11,456 2,983 - - 115 3,098 8,358 8,473	Furniture, fittings, plant & machinery, equipment, building improvements & motor vehicles £'000 7,245 9 (900) 815 7,169 5,965 3 (900) 489 5,557 1,612 1,280	Total £'000 21,701 9 (900) 815
				21,625
				8,948 3 (900) 604
				8,655
				12,970
				12,753

Furniture, fittings, plant & machinery, equipment, building improvements and motor vehicles contain assets in the course of construction £5,000 (2024: £22,000).

Charity Cost At 1 October 2024 Exchange differences on consolidation Disposals Additions At 30 September 2025 Depreciation At 1 October 2024 Exchange differences on consolidation Eliminated on disposals Charge for the year At 30 September 2025 Net book value At 30 September 2025 At 30 September 2024	Freehold land £'000 3,000 - - - 3,000 - - - - - 3,000 3,000	Freehold buildings £'000 11,456 - - - 11,456 2,983 - - 115 3,098 8,358 8,473	Furniture, fittings, plant & machinery, equipment, building improvements & motor vehicles £'000 6,204 9 (858) 772 6,127 5,081 5 (858) 384 4,612 1,515 1,123	Total £'000 20,660 9 (858) 772
				20,583
				8,064 5 (858) 499
				7,710
				12,873
				12,596

Furniture, fittings, plant & machinery, equipment, building improvements and motor vehicles contain assets in the course of construction £5,000 (2024: £22,000).

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30th September

8 Fixed asset investments

Group Quoted Hedge Funds Property Fund Portfolio Funds UK Fixed Interest Funds International Fixed Interest Funds UK Equity Funds International Equity Funds Total Quoted investments Portfolio cash Total market value at 30 September Total historical cost at 30 September Reconciliation of opening and closing market values Opening market value at 1 October Additions at cost Disposals at opening market value Net (loss)/gain on revaluation Closing market value at 30 September Portfolio cash at 30 September Total market value at 30 September Charity Quoted Hedge Funds Property Fund Portfolio Funds UK Fixed Interest Funds International Fixed Interest Funds UK Equity Funds International Equity Funds Total Quoted investments Portfolio cash Total market value at 30 September Total historical cost at 30 September Reconciliation of opening and closing market values Opening market value at 1 October Additions at cost Disposals at opening market value Net (loss)/gain on revaluation Closing market value at 30 September Portfolio cash at 30 September Total market value at 30 September	2025 £'000 593 514 11,653 914 364 743 6,771 21,552 247 21,799 19,065 10,917 12,381 (3,287) 1,541 21,552 247 21,799 2025 £'000 593 514 5,398 914 364 743 6,771 15,297 211 15,508 9,786 10,917 5,568 (2,297) 1,109 15,297 211 15,508	2024 £'000 427 394 5,159 495 280 550 3,612
		10,917 6,149
		17,066
		9,786
		10,101 2,000 (2,080) 896
		10,917 6,149
		17,066
		2024 £'000 427 394 5,159 495 280 550 3,612
		10,917 136
		11,053
		9,786
		10,101 2,000 (2,080) 896
		10,917 136
		11,053

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30th September 2025

9 Debtors Group Trade debtors Other debtors Prepayments and accrued income Charity Trade debtors Other debtors Amounts owed by group and associated undertakings Prepayments and accrued income	2025 £'000 940 499 2,843 4,282 2025 £'000 456 252 1,017 2,664 4,389	2024 £'000 345 540 2,363
		3,248
		2024 £'000 133 334 565 1,871
		2,903

10 Creditors: amounts falling due within one year Group Trade creditors Other creditors Taxation and social security Accruals Deferred income (note 11) Charity Trade creditors Other creditors Taxation and social security Accruals Deferred income (note 11) 11 Deferred income Group Brought forward at 1 October Received in the year Expended in the year Carried forward at 30 September Charity Brought forward at 1 October Received in the year Expended in the year Carried forward at 30 September	2025 £'000 569 134 399 776 7,211 9,089 2025 £'000 473 98 268 564 4,490 5,893 2025 £'000 7,942 23,098 (23,829) 7,211 2025 £'000 4,227 9,477 (9,214) 4,490	2024 £'000 475 92 272 684 7,942
		9,465
		2024 £'000 430 89 230 530 4,227
		5,506
		2024 £'000 6,791 18,431 (17,280)
		7,942
		2024 £'000 3,815 6,741 (6,329)
		4,227

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30th September 2025

12 Movement in funds

Group

Expendable endowment Restricted Gerald Segal Memorial Fund Research Grants Unrestricted General fund Pensions reserve Total funds Charity Expendable endowment Restricted Gerald Segal Memorial Fund Research Grants Unrestricted General fund Pensions reserve Total funds	Balances b/fwd £'000 11,146 10 72 82 22,512 - 22,512 33,740 Balances b/fwd £'000 5,144 10 28 38 20,222 - 20,222 25,404	Income £'000 2,062 - 6,288 6,288 25,301 25,301 33,651 Income £'000 2,062 3,746 3,746 13,304 13,304 19,112	Expenditure £'000 - (2) (6,357) (6,359) (23,166) (23,166) (29,525) Expenditure £'000 - (2) (3,781) (3,783) (9,447) (9,447) (13,230)	Transfers £'000 - - 15 15 (51) 36 (15) - Transfers £'000 - - 15 15 (51) 36 (15) -	Gains/ (losses) £'000 880 - - - 707 (36) 671 1,551 Gains/ (losses) £'000 617 - - - 682 (36) 646 1,263	Balances c/fwd £'000 14,088
						8 18
						26
						25,303 -
						25,303
						39,417
						Balances c/fwd £'000 7,823
						8 8
						16
						24,710 -
						24,710
						32,549

Expendable endowment - restricted to fund a Chair in Japanese Security Studies at the IISS, IISS-Asia Senior Fellow for Nuclear Arms Control including a new fund in 2025 to fund Korea Chair Senior Fellow and activities. Gerald Segal Memorial Fund - to fund study on Asian issues.

Restricted Grants - for research projects and specific non-research projects in strategic studies.

Pensions reserve - represents the FRS102 pension liability.

13 Analysis of net assets by fund

Group

Tangible assets Intangible assets Investments Net current assets/ (liabilities) Pension liability arity Tangible assets Intangible assets Investments Net current assets/ (liabilities) Pension liability	Expendable Endowment £'000 - - 14,088 - - 14,088 Expendable Endowment £'000 - - 7,823 - - 7,823	Restricted Funds £'000 - - - 26 - 26 Restricted Funds £'000 - - - 16 - 16	Unrestricted Funds £'000 12,970 452 7,711 4,170 - 25,303 Unrestricted Funds £'000 12,873 452 7,685 3,700 - 24,710	Total Funds £'000 12,970 452 21,799 4,196 -
				39,417
				Total Funds £'000 12,873 452 15,508 3,716 -
				32,549

Charity

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30th September 2025

14 Pension schemes

The disclosures set out below relate to pension schemes to which contributions are made by the charity – a defined benefit scheme, individual personal pension schemes and a defined contribution scheme.

a Defined benefit scheme

The Institute sponsors the International Institute for Strategic Studies Staff Superannuation Scheme which is a defined benefit arrangement. The last completed full actuarial valuation of this scheme was carried out by a qualified independent actuary as at 29 February 2024. The scheme is closed to new entrants and no contributions were made during the year.

Prior to completion of the valuation, the Institute made deficit funding payments of £25,000 during the financial year. Following the triennial actuarial valuation as at 28 February 2024, these payments are no longer required as the scheme is no longer in a deficit position.

Subsequent to the year-end, a full scheme buy-in was completed with an insurance policy purchased from insurer Just to meet all scheme liabilities.

i) The amounts recognised in the balance sheet are as follows:

Present value of funded obligations Fair value of plan assets Asset/(deficit) Effect of asset ceiling Net defined benefit asset/(liability) Amounts in the balance sheet: Liabilities Assets Net liability	2025 2024 £'000 £'000 (1,722) (2,314) 2,500 2,530 778 216 (778) (216) - - - - - - - -

ii) Changes in the present value of the defined benefit obligation are as follows:

Defined benefit obligation at start of year Interest expense Actuarial losses / (gains) Benefits paid and expenses Defined benefit obligation at end of year	2025 2024 £'000 £'000 2,314 2,136 115 119 (619) 121 (88) (62) 1,722 2,314

iii) Changes in the fair value of the scheme assets are as follows:

Opening fair value of scheme assets Interest Income Actuarial gains / (losses) Contributions by the company Benefits paid and expenses Fair value of scheme assets at the year end The actual return on the plan assets in the year	2025 2024 £'000 £'000 2,530 2,279 126 129 (93) 124 25 60 (88) (62) 2,500 2,530 2025 2024 £'000 £'000 33 253

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30th September 2025

14 Pension scheme (continued)

iv) The defined benefit costs recognised within the Statement of Financial Activities are as follows:

Net interest cost Total amount charged to the Statement of Financial Activities	2025 £'000 (11) (11)	2024 £'000 (10)
		(10)

The International Institute for Strategic Studies are no longer required to make any contributions to its defined benefit pension scheme in the year ending 30 September 2026, since the scheme completed a full buy-in subsequent to the year-end.

v) Defined benefit costs included in other recognised gains and losses

Return on plan assets (excluding amounts included in net interest cost) - gain / (loss) Experience gains / (losses) arising on the plan liabilities Effects of changes in the demographic and financial assumptions underlying the present value of the plan liabilities - gain / (loss) Changes in asset ceiling Total gains/(losses) included in other recognised gains and losses	2025 £'000 (93) (453) (166) (778) (1,490)	2024 £'000 124 (18) 139 (216)
		29

vi) The major categories of scheme assets are as follows:

Equities Fixed Interest Diversified Growth Property Cash and other Total Assets	2025 £'000 568 1,171 548 152 61 2,500	2024 £'000 563 1,255 514 153 45
		2,530

vii)	Principal assumptions at the balance sheet date (expressed as weighted
	averages)
			2025	2024
	Discount rate at 30 September		5.80%	5.06%
	Inflation (RPI)		3.22%	3.34%
	Inflation (CPI)		2.47%	2.49%
	Allowance for revaluation of deferred pensions of CPI or 5% p.a. if less		2.47%	2.49%
	Allowance for pension in payment increases of RPI or 5% p.a. if less		3.01%	3.11%
	Allowance for pension in payment increases of RPI or 2.5% p.a. if less		2.03%	2.07%
	Allowance for commutation of pension for cash at retirement	50% of Post A Day		50% of Post A Day
viii)	The mortality assumptions adopted at 30 September 2025 imply the following		Years
	life expectancies at age 65:
	Male retiring in 2024		20.80
	Female retiring in 2024		23.50
	Male retiring in 2044		22.10
	Female retiring in 2044		25.00

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30th September 2025

14 Pension scheme (continued)

b Personal pension plans

The Institute did not contribute to the personal pension schemes of employees in the year. No contributions was charged to the Statement of Financial Activities when due and no cost incurred for the year ended 30 September 2025 (2024: £22,000).

c Defined contribution scheme

The Institute has a defined contribution pension scheme which is open to all employees. The contributions made in the year ended 30 September 2025 were £549,000 (2024: £437,000). Contributions outstanding at the year end amounted to £89,000 (2024: £73,000).

d IISS-US pension scheme

The Institute contributes to a United States 401(k) defined contribution pension scheme which is open to employees at the IISS-US office. The contributions paid in the year ended 30 September 2025 were £24,000 (2024: £19,000). Contributions accrued at the year end amounted to £4,800 (2024: £5,900).

15 Leasing commitments

The future total minimum payments to which the Group is committed as at 30 September 2025 under operating lease agreements are as follows:

agreements are as follows:
	2025	2024
	£'000	£'000
Office premises
Net present value of total lease commitments due:
Within one year	1,332	1,314
Between one and two years	1,344	1,344
Between two and five years	3,149	3,210
Over five years	1,125	1,471

16 Capital commitments

As at 30 September 2025, capital commitments of £211,000 had been contracted but not provided for. These relate to reinstating fixtures and implementing a new finance system, including website releases and CCTV upgrades.(2024: £63,000).

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30th September 2025

17 Related Parties

a Trustees or connected persons

The Trustees did not receive any remuneration during the current or previous year.

No transactions, contracts or other arrangements (including grants) with any Trustees were entered into by the Institute during the year ended 30 September 2025 (2024: Nil).

Travel expenses for both governance and attending Institute dialogues and other activities were paid or reimbursed in respect of 7 trustee (2024: 6) and the total amount was £9,300 (2024: £18,000).

b Other related parties

The ultimate parent undertaking (Parent Charity) includes IISS-UK, and its two branches, IISS-US and IISS-Middle East.

I Arundel House Enterprises Ltd

Related party transactions of the ultimate parent undertaking with Arundel House Enterprises Ltd were as follows:

Balance at beginning of year Expenses paid on behalf of Parent Expenses paid on behalf of related party Amounts paid in during the year Foreign currency movement Balance at end of year	2025 2024 £'000 £'000 (371) (52) (842) (423) 2,971 1,125 (1,223) (1,052) (27) 31 508 (371)

II International Institute for Strategic Studies (Asia) Ltd

Related party transactions of the ultimate parent undertaking with IISS-Asia Ltd were as follows:

Balance at beginning of year Expenses paid on behalf of Parent Expenses paid on behalf of related party Amounts paid out during the year Amounts paid in during the year Foreign currency movement Balance forgiven on behalf of Parent Balance at end of year	2025 2024 £'000 £'000 - - (1,088) (510) 3,724 2,760 (6,747) (2,044) 15 (14) 4,096 (192) - -

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30th September 2025

III Strategic Studies Fund

Related party transactions of the ultimate parent undertaking with the Strategic Studies Fund were as follows:

Balance at beginning of year Expenses paid on behalf of Parent Expenses paid on behalf of related party Foreign currency movement Balance at end of year	2025 £'000 4 (4) - -	2024 £'000 3 - 1
		4

Related party transactions of IISS-Asia with the Strategic Studies Fund were as follows:

Balance at beginning of year Expenses paid on behalf of Parent (IISS-Asia) Expenses paid on behalf of related party Amounts paid in during the year Foreign currency movement Balance at end of year	2025 £'000 (23) - 23 - - -	2024 £'000 (164) - 137 - 4
		(23)

IV IISS India Organisation

Related party transactions of the ultimate parent undertaking with IISS India Organisation were as follows:

Balance at beginning of year Expenses paid on behalf of Parent Expenses paid on behalf of related party Foreign currency movement Balance at end of year	2025 £'000 64 (61) (3) -	2024 £'000 71 (7)
		64

V IISS Europe gemeinnützige GmbH

Related party transactions of the ultimate parent undertaking with IISS Europe gemeinnützige GmbH were as follows:

Balance at beginning of year Expenses paid on behalf of Parent Expenses paid on behalf of related party Amounts paid out during the year Foreign currency movement Balance at end of year	2025 £'000 867 (1,276) 915 - 2 508	2024 £'000 542 (186) 297 225 (11)
		867

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30th September 2025

18 Subsidiary undertakings

I Arundel House Enterprises Ltd

Registered office : Arundel House, 6 Temple Place, London, WC2R 2PG Registered number : 3720258

The charity beneficially owns the entire share capital of Arundel House Enterprises Limited, a company
a incorporated in England and Wales under registration number 3720258, which manages the conference facilitie and provision of event catering at Arundel House, and provides advisory and consultancy services. The results for Arundel House Enterprises Limited have been consolidated into the group financial statements.

b Summary of profit and loss account for Arundel House Enterprises Ltd

Turnover Cost of sales Gross profit Other expenses Net profit before taxation Gift Aid to IISS Loss after taxation	2025 £'000 2,600 (360) 2,240 (1,647) 593 (593) -	2024 £'000 1,085 (41)
		1,044 (688)
		356 (356)
		-

c Summary of balance sheet for Arundel House Enterprises Ltd

Tangible fixed assets Debtors Cash at bank and in hand Current assets Creditors Net assets Aggregate capital and reserves	2025 £'000 - 78 877 955 (945) 10 10	2024 £'000 - 804 13
		817 (807) 10
		10

II International Institute for Strategic Studies (Asia) Ltd

Registered office : 9 Raffles Place, #51-01 Republic Plaza, Singapore 048619 Registration number : 200106226Z

a The charity holds a majority of the voting rights of The International Institute for Strategic Studies (Asia) Limited, a company limited by guarantee and incorporated in Singapore under company number 200106226Z. The financial statements are audited in local currency and converted into UK£ Sterling at the appropriate exchange rate for consolidation purposes.

b Summary of income statement for International Institute for Strategic Studies (Asia) Ltd

Donations Dialogue and Lecture Series Research programmes Other Total income Dialogue and Lecture Series Research programmes Total expenses Net losses less gains on investments (Deficit)/Surplus for the year	2025 £'000 - 6,201 2,666 165 9,032 (4,032) (6,844) (10,876) 380 (1,464)	2024 £'000 6,003 6,073 2,280 157 14,513 (3,791) (3,900) (7,691) 0 6,822 43

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30th September 2025

c Summary of balance sheet for International Institute for Strategic Studies (Asia) Ltd

Tangible fixed assets Debtors Cash at bank and in hand Current assets Creditors Net assets Aggregate capital and reserves	2025 £'000 6,339 406 2,635 3,041 (1,783) 7,597 7,597	2024 £'000 6,125 358 4,495
		4,853 (1,861)
		9,117
		9,117

III Strategic Studies Fund

Registered office : 9 Raffles Place, #51-01 Republic Plaza, Singapore 048619 IPC Registration number : 1798

a The charity is a trustee of the Strategic Studies Fund (SSF), a trust established in Singapore under Charity number 1798, and has ultimate discretion over the disbursement of SSF funds. The financial statements are audited in local currency and converted into UK£ Sterling at the appropriate exchange rate for consolidation purposes. During the year, it was agreed to wind up SSF and these will be final audited financial statements.

b Summary of income statement for Strategic Studies Fund

2025 £'000 Lectures Series - Research - Total income - Lectures Series (15) Research - Other expenses - Total expenses (15) Deficit for the year (15) Summary of balance sheet for Strategic Studies Fund 2025 £'000 Debtors - Creditors - Net assets - Reserves -	2024 £'000 132 -
	132
	(138) - -
	(138)
	(6)
	2024 £'000 20 (5)
	15
	15

c Summary of balance sheet for Strategic Studies Fund

IV IISS India Organisation

Registered office: E-301, East of Kailash, New Delhi-110065, India Incorporated in India with limited liability under number U80903DL2014NPL270367

a The charity holds a majority share-holding (99.9%) in IISS India Organisation, a limited not for profit company incorporated in India. The financial statements are audited in local currency and converted into UK£ Sterling at the appropriate exchange rate for consolidation purposes.

IISS-India was wound up during the year and the company officially dissolved on 25 July 2025.

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30th September 2025

b Summary of income statement for IISS India Organisation

Other Income Total income Other expenses Total expenses Surplus for the year	2025 £'000 - - 60 60 60	2024 £'000 -
		-
		-
		-
		-

c Summary of balance sheet for IISS India Organisation

Debtors Cash at bank and in hand Current assets Creditors Net liabilities Aggregate capital and reserves	2025 £'000 - - - - - -	2024 £'000 5 -
		5 (65)
		(60)
		(60)

V IISS Europe gemeinnützige GmbH

Registered office: Palais am Pariser Platz, Pariser Platz 6A, 10117 Berlin, Germany

a The charity holds a 100% share in IISS Europe gemeinnützige GmbH, a not for profit company incorporated in Germany on 28 May 2019. The financial statements are audited in local currency and converted into UK£ Sterling at the appropriate exchange rate for consolidation purposes.

b Summary of income statement for IISS-Europe

Dialogue Research Other Income Total income Dialogue Research Total expenses Surplus/(Deficit) for the year	2025 £'000 2,942 910 - 3,852 (2,801) (1,010) (3,811) 41	2024 £'000 381 972 -
		1,353
		(163) (1,426)
		(1,589)
		(236)

c Summary of balance sheet for IISS-Europe

Tangible fixed assets Debtors Cash at bank and in hand Current assets Creditors Net liabilities Aggregate capital and reserves	2025 £'000 49 106 271 377 (1,165) (739) (739)	2024 £'000 46 475 1,273
		1,748 (2,537)
		(743)
		(743)

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30th September 2025

19 Comparative Information

i) Consolidated Statement of Financial Activities (incorporating an income and expenditure account)

Year ended 30[th] September 2024

Notes Income from: Donations 2 Charitable activities Dialogues, conferences and lecture series 3 Research programmes 3 Publications Membership Other trading activities Investments Capital applied to income Other income Total Expenditure on: Raising funds Charitable activities Dialogues, conferences and lecture series 4 Research programmes 4 Publications 4 Membership 4 Other trading activities Total Net gains on investments 17 Net income/ (expenditure) Transfers between funds 12 Other recognised gains/(losses): Foreign exchange gains Actuarial losses on defined benefit pension schemes 14 Net movement in funds Funds brought forward at 1 October 2023 12 Funds carried forward at 30 September 2024 12,13	Unrestricted Funds £'000 3,552 10,436 1,637 1,516 2,058 1,018 120 - 254 20,591 53 7,418 6,313 4,347 688 663 19,482 558 1,667 - (219) (70) 1,378 21,134 22,512	Restricted Funds £'000 - - 5,428 - - - 300 193 - 5,921 - - 6,010 - - - 6,010 - (89) - - - (89) 171 82	Endowed Funds £'000 6,003 - - - - - - (193) - 5,810 - - - - - - - 369 6,179 - - - 6,179 4,967 11,146	Total Funds Total Funds 2024 2023 £'000 £'000 9,555 3,053 10,436 9,930 7,065 7,679 1,516 1,480 2,058 1,890 1,018 515 420 343 - - 254 140 32,322 25,030 53 86 7,418 7,366 12,323 12,174 4,347 4,700 688 554 663 359 25,492 25,239 927 (110) 7,757 (319) - - (219) (111) (70) (70) 7,468 (500) 26,272 26,772 33,740 26,272

All amounts relate to continuing operations and, as all gains and losses are included, a separate statement of total recognised gains and losses has not been presented.

The International Institute for Strategic Studies

Annual Report and Financial Statements for the year ended 30th September 2025

ii) Comparative movement in funds

For the year ended 30 September 2024

Group Expendable endowment Restricted Gerald Segal Memorial Fund Research Grants Unrestricted General fund Pensions reserve Total funds Charity Expendable endowment Restricted Gerald Segal Memorial Fund Research Grants Unrestricted General fund Pensions reserve Total funds	Balances b/fwd £'000 4,967 22 149 171 21,134 - 21,134 26,272 Balances b/fwd £'000 4,967 22 106 128 19,299 - 19,299 24,394	Income £'000 5,810 - 5,921 5,921 20,591 - 20,591 32,322 Income £'000 (193) - 3,841 3,841 12,013 - 12,013 15,661	Expenditure £'000 - (12) (5,998) (6,010) (19,482) - (19,482) (25,492) Expenditure £'000 - (12) (3,919) (3,931) (11,479) - (11,479) (15,410)	Transfers £'000 - - - - (70) 70 - - Transfers £'000 - - - - (70) 70 - -	Gains/ (losses) £'000 369 - - - 339 (70) 269 638 Gains/ (losses) £'000 370 - - - 459 (70) 389 759	Balances c/fwd £'000 11,146
						10 72
						82
						22,512 -
						22,512
						33,740
						Balances c/fwd £'000 5,144
						10 28
						38
						20,222 -
						20,222
						25,404

Expendable endowment - restricted to fund a Chair in Japanese Security Studies at the IISS Gerald Segal Memorial Fund - to fund study on Asian issues.

Restricted Grants - for research projects and specific non-research projects in strategic studies. Pensions reserve - represents the FRS102 pension liability.

iii) Comparative Analysis of net assets by fund

For the year ended 30 September 2024

Group

Tangible assets Intangible assets Investments Net current assets/ (liabilities) Pension liability Charity Tangible assets Intangible assets Investments Net current assets/ (liabilities) Pension liability	Expendable Endowment £'000 - - 11,146 - - 11,146 Expendable Endowment £'000 - - 5,144 - - 5,144	Restricted Funds £'000 - - - 82 - 82 Restricted Funds £'000 - - - 38 - 38	Unrestricted Funds £'000 12,753 468 5,920 3,371 - 22,512 Unrestricted Funds £'000 12,596 469 5,909 1,248 - 20,222	Total Funds £'000 12,753 468 17,066 3,453 -
				33,740
				Total Funds £'000 12,596 469 11,053 1,286 -
				25,404

The International Institute for Strategic Studies

FOR INFORMATION ONLY: CHARITY SOFA DOES NOT FORM PART OF AUDITED FINANCIAL STATEMENTS

YEAR ENDED 30TH SEPTEMBER 2025

Income from: Donations Charitable activities Dialogues, conferences and lecture series Research programmes Publications Membership Investments Capital applied to income Other incoming resources Total Expenditure on: Raising funds Charitable activities Dialogues, conferences and lecture series Research programmes Publications Membership Total Net (losses)/ gains on investments Net income/ (expenditure) Transfers between funds Other recognised gains/(losses): Foreign exchange (losses)/ gains Actuarial gains/ (losses) on defined benefit pension schemes Net movement in funds Funds brought forward at 1 October 2023 Funds carried forward at 30 September 2024	Unrestricted Funds £'000 4,102 4,339 469 1,862 2,086 121 - 325 13,304 67 3,840 627 4,156 757 9,447 680 4,537 (15) 2 (36) 4,488 20,223 24,711	Restricted Funds £'000 - - 3,305 - - 216 220 5 3,746 - - 3,783 - - 3,783 - (37) 15 - - (22) 72 50	Endowed Funds £'000 2,282 - - - - - (220) - 2,062 - - - - - - 617 2,679 - - - 2,679 5,109 7,788	Total Funds 2025 £'000 6,384 4,339 3,774 1,862 2,086 337 - 330 19,112 67 3,840 4,410 4,156 757 13,230 1,297 7,179 - 2 (36) 7,145 25,404 32,549	Total Funds 2024 £'000 3,908 3,849 3,812 1,516 2,058 340 - 178
					15,661
					53 3,326 7,004 4,340 687
					15,410 928
					1,179 - (99) (70)
					1,010 24,394
					25,404

2025-09-30-accounts

Company Number: 615259 Charity Number: 206504

THE INTERNATIONAL INSTITUTE FOR STRATEGIC STUDIES

Annual Report and Financial Statements for the year ended 30 September 2025

CONTENTS

Annual Report and Financial Statements

STRATEGIC REPORT AND THE REPORT OF THE TRUSTEES

Strategy

Research, Dissemination and Digital Content

Convening Power

Global Coverage and International Strategic Network

OBJECTIVES AND PRINCIPAL ACTIVITIES

Annual Report and Financial Statements for the year ended 30 September 2025

ACHIEVEMENTS AND PERFORMANCE

Research Programmes

Annual Report and Financial Statements for the year ended 30 September 2025

Annual Report and Financial Statements for the year ended 30 September 2025

Publications

Dialogues, Lecture Series and Conferences

1. The Shangri-La Dialogue

2. The Manama Dialogue

3. Prague Defence Summit

4. Lecture Series

Membership

FINANCIAL REVIEW AND RESULTS FOR THE YEAR

Reserves

Investment Policy and Performance

Annual Report and Financial Statements for the year ended 30 September 2025

The IISS and the Economic Climate

Financial health

PRINCIPAL RISKS AND UNCERTAINTIES

FUTURE PLANS

Annual Report and Financial Statements for the year ended 30 September 2025

STRUCTURE, GOVERNANCE AND MANAGEMENT

Annual Report and Financial Statements for the year ended 30 September 2025

Audit Committee

Investment Committee

Trustee Remuneration and Employment Committee

Nominations Committee

Director-General and Chief Executive

Remuneration Policy

Public Benefit

Group Structure

IISS Middle East

The International Institute for Strategic Studies – US (IISS-Americas)

Arundel House Enterprises Limited (AHEL)

The International Institute for Strategic Studies (Asia) Limited (IISS-Asia) and the Strategic Studies Fund (SSF)

IISS India Organisation – (IISS-India)

IISS Europe gemeinnützige GmbH (IISS-Europe)

Statement of Trustees’ Responsibilities

Corporate Governance

Auditors

REFERENCE AND ADMINISTRATIVE DETAILS

Executive Directing Staff

Agents and Advisers

Independent Auditor’s Report to the Members of The International Institute for Strategic Studies

Opinion

Basis for opinion

Conclusions relating to going concern

Other information

Annual Report and Financial Statements for the year ended 30 September 2025

Opinions on other matters prescribed by the Companies Act 2006

Matters on which we are required to report by exception

Responsibilities of trustees

Auditor’s responsibilities for the audit of the financial statements

Extent to which the audit was considered capable of detecting irregularities, including fraud

Use of our report

Annual Report and Financial Statements for the year ended 30[th] September 2025

CONSOLIDATED STATEMENT OF FINANCIAL ACTIVITIES (incorporating an income and expenditure account)

CONSOLIDATED BALANCE SHEET (Company Number 615259)

As at 30[th] September 2025

CHARITY BALANCE SHEET (Company Number 615259)

As at 30th September 2025

CONSOLIDATED STATEMENT OF CASH FLOW

NOTES TO THE FINANCIAL STATEMENTS

1 Accounting policies

a) Status

b) Accounting convention

Basis of consolidation

Going concern