Women Get On Board is a member-based company that connects, promotes and empowers women to corporate boards. That’s why we’ve launched the Women Get On Board Virtual Speaker Series, focused on topics that are essential for boards to be more effective in their roles.
For our most recent speaker series on February 11, 2021, Deborah Rosati, FCPA, FCA, ICD.D, Corporate Director & Founder and CEO of Women Get On Board introduced Natalie Giroux, Managing Director of Stratford Intellectual Property. An intellectual property (IP) expert with deep technical knowledge and strong business insights, Natalie brings extensive experience in strategic IP management, network performance engineering, traffic management, and technical due diligence.
A vital role of any director is to be strategic about the protection of the company’s intellectual property.
“IP is one of the most valuable assets of any company,” said Natalie.
IP does not only refer to patents. It encompasses everything from trademarks and trade secrets to know-how and copyrights. For this reason, every organization—no matter its size or industry—has a stake in protecting IP and managing IP risks.
Asking the right questions
As a director, the best way to support the protection of your company’s IP is to ask strategic questions about current practices.
Natalie recommended 20 questions that directors should ask to determine the state of IP at their organization. Link to blog: https://stratford.group/insights/questions-board-members-should-ask-about-ip
As a starting point, she suggested inquiring about internal policies. Ask about the culture surrounding IP at the company and inquire about how knowledgeable employees are on the issue. Natalie’s advice? All employees should have “a healthy dose of paranoia” about mishandling IP.
She recommended implementing incentive programs, basic IP awareness training for every team member, top-notch cyber security, and a “clean desk policy” to avoid unintentional loss of IP. Even a rule as simple as ensuring that whiteboards are cleared of sensitive information after each meeting can make a difference. Additionally, all employee contracts should contain well-defined non-disclosure agreements, as well as an IP assignment clause.
Ask about the company’s executives, too. Natalie said that all senior leaders should have a strong understanding of the organization’s IP processes and strategy.
“Too often, the IP strategy is handled by one executive in a silo and the rest of the executive team doesn’t even understand what it is,” she said.
What about investors? What can you do assure them that your IP is in safe hands? The key is to always be due diligence ready. That means keeping all IP carefully catalogued and ready for review at any time. To ensure that the company is prepared for due diligence, directors should inquire about current IP tracking processes and ensure they are up to par.
Researching the IP landscape
Learning how your company fits into the larger IP landscape can help to set strategy moving forward. Directors should ensure that the organization is regularly researching trademarks and patents in their industry to gain valuable intelligence on existing and emerging competitors, as well as potential partners.
In addition to providing intelligence, research can help companies identify IP for acquisition. Purchasing IP from universities can be a cost-effective form of R&D when conducted correctly.
Savvy board members would also be wise to inquire about the company’s most recent freedom to operate search. Although costly, it is crucial to be certain that the company has the right to offer their product in any given location.
Without careful management, managing IP can become quickly become expensive. Part of the board’s role is to investigate the financial aspects of IP protection.
Don’t be shy about looking into the organization’s filing strategy for IP—and the related expenses. Too often, companies file patents or trademarks without a plan to pay for the upcoming costs of moving it forward. Similarly, it is worthwhile to ask about whether there is a strategy in place to divest or license IP as a separate income stream.
Directors should also be aware of how IP affects the company’s valuation. During mergers and acquisitions, organizations often neglect to include trademarks, trade secrets, copyrights, and patents in their valuation—to their detriment. Ask leadership if they are maintaining a running valuation of the company’s IP as it grows.
Managing IP Risks
Board members should be prepared to ask about how the company will handle the risks related to IP. How are they monitoring for infringement of each of the organization’s trademarks, patents, trade secrets, and copyright? Does the company have a strategy to ensure that it is adhering to industry standards and taking all relevant bylaws into account?
Directors would be also wise to inquire about the company’s plan if it is sued for IP infringement itself. Litigation in such cases often moves quickly, so it is crucial that leadership has a response team in place, as well as an internal and external communications plan.
Everyone could benefit from becoming more informed about IP management. As Natalie pointed out, IP is fragile and requires extensive protection.
“The minute the IP is lost, it is too late and it’s really impossible to recover,” she said.
As a director, you have a role to play in protection the company’s IP. It is your job to ensure that you understand the issues surrounding IP, and the correct questions to ask.
Interested in learning more about effective boards and governance? Join us for our next virtual Women Get On Board Speaker Series on April 13th called “Are You Ready for Public Service Boards?”. Register here.