By Dana O’Born ~ Director of Strategic Initiatives
Whenever a new member company joins CCI, there’s a question I like to make a point of asking the CEO: How much IP does your company own?
The answers vary widely; depending on their business, some companies hold hundreds of patents, or only a handful, or none at all. But regardless, it tends to be a good start to an interesting conversation.
Every innovative company has leaders who think about intangible assets — that includes patents, yes, but also trademarks, copyright, industrial designs, developer contracts and other forms of intellectual property.
In 1975, just 17 per cent of the total value of the S&P 500 companies came from intangible assets, but as of 2020, 90% of the S&P 500 is intangible assets. Most of the largest, most valuable corporations in the world today are built mainly on intangible assets like software, patents and data.
The shift to an economy driven by IP and data has been underway for a while, but we can be sure that the COVID-19 pandemic has accelerated the transformation.
When she launched pre-budget consultations earlier this year — her first time doing so as Canada’s Finance Minister — Chrystia Freeland said that this year’s budget will be a monumentally different document than years past, because it will provide a roadmap for the post-pandemic recovery.
We were pleased to hear her goals of the budget are to create a Canadian economy that is “more innovative, more competitive, greener and more sustainable.”
Driving innovation and growth in the intangible economy is exactly why the No. 1 request in CCI’s 2021 pre-budget submission is to help Canadian innovators generate more Canadian intellectual property.
Today in Canada, one of the most important government programs for driving innovation and technological development is the Scientific Research and Experimental Development (SR&ED) tax credit.
But while SR&ED covers a range of specific activities for private sector research and development, it stops short of allowing companies to claim the costs associated with filing a patent or other forms of IP.
What message are we sending to Canadian businesses when we encourage businesses to apply their ingenuity to developing new ideas, new products, new workflows and new technologies, but we don’t consider the steps to actually own those innovations to be part of the R&D process?
Expanding SR&ED isn’t our only idea for how Canada can generate more intellectual property, and derive future prosperity in the knowledge economy by owning these vital intangible assets.
CCI’s budget submission is full of ideas for how to put intellectual property and innovation at the centre of the Canadian economy, and if you’re interested, I’d encourage you to take the time to read the whole document here.
To learn more about CCI’s federal advocacy efforts, please get in touch with me at email@example.com