The report notes that many corporate leaders are not aware of the value of their IP and are not involved in the risk planning around it which can leave valuable businesses exposed to risks
threatening their intellectual capital, in addition to failing to maximise on their IP portfolios.
As businesses race to fully digitise their processes and deploy a remote workforce in response to the pandemic, they are exposing their IP to a range of new risks. Particularly, the report identifies risks that come from rising cyber security threats. With many most vulnerable in the development phases of IP, remote working makes it more difficult for organisations to protect confidential information from cyber criminals.
Paul Merrey, Insurance Partner at KPMG UK, said: “Intellectual property is becoming an increasingly important driver of corporate value. Without proper valuation or risk management processes in place, businesses face failing to capitalise on their IP portfolios, as well as damaging them. Currently insurance offerings in this space are limited, but insurance can play a role in safeguarding this value. There are major opportunities for those willing to go beyond covering the legal costs associated with IP infringement, as existing solutions do, and provide more comprehensive cover that demonstrates a greater appreciation for the value of IP itself.”
The report points to the risks that surface throughout the IP lifecycle, from the moment work starts on research development to later stages, including monetising IP portfolios. It also includes key actions risk owners can take to minimise the risk to their IP portfolios, including:
1. Mitigating risks during creation and development processes of IP by signing NDAs with employees and business partners, articulating ownership rights, and safeguarding access to information.
2. Keeping your IP secret before its registered and in the public domain by following the guidance of domestic legislation in each IP jurisdiction and providing regular staff training on handling confidential information.
3. Maximising the value of IP through registration by selecting the right type of IP and deciding how broad or narrow the registration should be, as well as thinking through the geographical scope of the IP rights
4. Enforcing your rights during monetisation of your IP by forming ‘rainy day’ funds, creating patent thickets, and carefully monitoring licensing agreements, including conducting compliance audits. Having a clear market reputation as someone that protects its IP will also help deter potential infringers.
Dr. Trevor Maynard, Head of Innovation at Lloyd’s said: “This is the first of three in-depth reports on key intangible assets. Modern companies must protect these assets, just as they are careful with physical assets, and insurance is a key way to transfer their risks. In response, the Product Innovation Facility at Lloyd’s is working with our customers to create new insurance solutions in this space.”
Safeguarding Intellectual Property to Enhance Corporate Value
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