Enterprise Risk Management and Intangible Assets…

Michael D. Moberly   February 2, 2010

In 2010 it would seem to be a management team, board, and c-suite ‘no brainer’ that enterprise risk management initiatives should universally encompass, without much argument or opposition, a company’s intangible and intellectual property assets!  

The full inclusion of intangible assets in ERM initiatives is epecially relevant today in light of the global economic fact (business reality) that steadily rising percentages (65+%) of most company’s value, sources of revenue, building blocks for future wealth creation and sustainability lie in – are directly related to the (a.) production, (b.) acquisition, and (c.) effective utilization of (a company’s) intangible assets and intellectual property. 

Taking this perspective one, and perhaps obvious, step further, it would also seem prudent, when the risks to those valuable, yet frequently fragile, assets are experiencing elevated vulnerability (probability) to loss, infringement, misappropriation, value erosion-dilution, and/or competitive advantage undermining, as they are today, that designing a position to oversee a company’s intangible asset risks would be an equally prudent consideration that would compliment management teams’ mounting fiduciary responsibilities for consistent and effective stewardship, oversight, and management of those assets.  

And, even more complimentary, the intangible asset risk positions’ overall performance (results, outcomes, and contributions, etc.) would be readily observable (transparent), measurable, and quantifiable.

At this point, risks to the intangible assets that a company produces and/or acquires is often spread, sometimes haphazardly and absent coordination or consensus, across an enterprise and subject to the sometimes subjective (risk taking) perspectives and spirit of business unit management.  While it is entirely imprudent to dismiss or disrespect the perspectives espoused by business unit management, stakeholders, and/or owners, it is true that efficiencies and effectiveness can be achieved when there is consenus and collaboration (enterprise wide) regarding the:

1. stewardship, oversight, and management of a company’s intangible and IP assets

2. abiliy to sustain control, use, ownership, and monitor the value, materiality, and risks to intangible and IP assets is articulated and understood as requisites integral to a company’s success, profitability, and sustainability.


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