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COVID-19 brings new cyber threats to businesses’ intellectual property

COVID-19 brings new cyber threats to businesses

KPMG, in collaboration with Lloyd’s, today publishes a report highlighting the new threats to intellectual property (IP) portfolios posed by a changing risk landscape under COVID-19.

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Safeguarding Intellectual Property to Enhance Corporate Value examines the increasing importance of intellectual property as a driver of corporate value, drawing attention to the risks and opportunities facing businesses.

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.”

 

ENDS

For more information, please contact:

Olivia Shalofsky
PR Assistant Manager, KPMG UK
(+44) 07469 441 308
Olivia.shalofsky@kpmg.co.uk

 

About KPMG

 

KPMG LLP, a UK limited liability partnership, operates from 21 offices across the UK with approximately 17,600 partners and staff.  The UK firm recorded a revenue of £2.40 billion in the year ended 30 September 2019. KPMG is a global network of professional firms providing Audit, Tax, Legal and Advisory services. It operates in 154 countries and has 200,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity.  Each KPMG firm is a legally distinct and separate entity and describes itself as such.

 

About Lloyd’s

Lloyd’s is the world’s leading insurance and reinsurance marketplace. Through the collective intelligence and risk-sharing expertise of the market’s underwriters and brokers, Lloyd’s helps to create a braver world.

The Lloyd’s market provides the leadership and insight to anticipate and understand risk, and the knowledge to develop relevant, new and innovative forms of insurance for customers globally.

It offers the efficiencies of shared resources and services in a marketplace that covers and shares risks from more than 200 territories, in any industry, at any scale.

And it promises a trusted, enduring partnership built on the confidence that Lloyd’s protects what matters most: helping people, businesses and communities to recover in times of need.

Lloyd’s began with a few courageous entrepreneurs in a coffeeshop. Three centuries later, the Lloyd’s market continues that proud tradition, sharing risk in order to protect, build resilience and inspire courage everywhere.

© 2020 KPMG LLP a UK limited liability partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.

For more detail about the structure of the KPMG global organisation please visit https://home.kpmg/governance.

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