IP at risk in new normal

As businesses race to digitise processes and work with a remote or hybrid workforce in response to the pandemic, they are exposing their IP to a range of new risks.

KPMG says corporate leaders are not aware of the value of their IP and are not involved in the risk planning around it which can leave businesses exposed.

Insurance partner at the firm, Paul Merrey, said IP 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," he explained. "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.”

Key actions to minise risks to IP portfolios (Source: Safeguarding Intellectual Property to Enhance Corporate Value, KPMG & Lloyd's of London)

Risks surface from the moment work starts on research development to later stages, including monetising IP portfolios. Risk owners can take the following key actions to minimise the risk to their IP portfolios:

- 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.

- 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.

- 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

- 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.

Image: Swiss Re

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