Intellectual Property (IP) Governance

Good governance brings about desired results of good performance and effective control among others. To this end, IP is one of the subjects that never enjoyed cold air of many boardrooms. Many believe that nothing relates to IP within their company, but on the contrary, Mideva a Kenyan Lawyer once said, “The presence of a creative mind denotes IP existence”.  For a minute just think and think again, have you protected the entity’s logo? What about the monthly journal? How do you document company IP? What about the new software?  I challenge you today to look up for annual financial statements and see how companies do not appreciate IP. 

An entity may own IP just like any other property, the difficulty is that IP is an intangible property, and this is the main reason it is often overlooked. The competitive advantage of nearly any Namibian business can be tied to its IP Assets; be it their software applications, brands, patented processes goodwill, trade secrets, corporate knowledge, copyright materials e.g. fliers, newsletters, photographs etc. and product designs. An entity may obtain intellectual property protection by registering the work with the Registrar of Intellectual Property as prescribed in relevant Acts. Registration is however not mandatory for copyright works since the protection is vested in the work once it is in a concrete form, notwithstanding the fact that registration is recommended.

It is the primary responsibility of the governing body to set, steer strategies and approve policies that give effect to IP management. Many of the Boards and organizations that promote best practices fail to consider the stewardship of IP-related assets; you may find that they do not include them in their books of accounts despite their existence. Typically, Board directors and management prioritized non-IP issues on the corporate agenda; however, legal requirements and market activities suggest that this might be a serious misstep simple because IP as much as it is intangible, if it is well managed it could be a messiah to many financial troubled entities.

In Namibia IP is registered and protected within the provisions of Industrial Property Act 01/2012 and copyright and neighboring right Protection Act 6/1994. It is alarming to note that despite the laws in place, many entities (private and public) have failed to protect their work that meets requirements of protection under of IP laws and this is a miscarriage of good governance. Disregarding IP within entities invites criticism and exhibits board failure to run an entity effectively, noting that well-established companies around the globe appreciate IP as key to success. Poor management of IP exposes entities to risk such that of losing Its IP to competitors and non-registration of new IP. In the absence of IP policies unnecessary litigation and disputes may arise such as in an event where an employee comes up with an invention or creation within the scope of the employment, without a policy, it would be difficult to determine the ownership of the work.

We should view IP in the same way we visualize the tangible assets because they are all entity’s resources that are acquired due to past events from which future economic benefits are expected to flow into the business. To give effect to IP within the organization, board of directors should adopt “Tone at the top” principle on IP during the execution of their fiduciary duty. IP management or governance include enactment of an effective policy on IP regulation. A policy should set out procedures of IP protection: the registration process of IP to gain exclusive rights, enforcement or procedures in an event of IP infringement, IP Register, IP valuation, Audit and most importantly IP commercialization. Entity must adopt a principle of keeping IP register, because it aids in determining the value of IP and enhances compliance such as renewal and maintenance.

Benefits of having a good and well-coordinated IP management in place cannot be overemphasized. Having effective practices and policies that regulate the IP in an entity reduces corporate risk. Well-managed IP can be used as collateral in obtaining financial leverage. An entity may, maximize its profit by commercializing their IP and they may discover new market opportunities.

An organization can only be a responsible corporate citizen if it prioritizes issues that will drive it towards success and sustainability of which IP is not exceptional. It is factual that globally; the business agenda is no longer set by the financially powerful but by those who are intellectually powerful; therefore, IP governance is essential.  

By:

Onesmus K Joseph - ACIS/ACFE/BAP/CFIP/PPL

MPHIL Candidate - KNUST (Kumasi; Ghana) 

Governance Practitioner

josephonesmus@yahoo.com