The Importance of Transparency in IP

It may seem like an obvious aspect of our work in IP, however transparency is not always a given in our world.  It often requires a little extra effort to be transparent and inform stakeholders in a deliberate way.  We look today at transparency from the point of view of in-house IP teams, law firms and legal process outsourcing (LPO) service providers, with the intention of reminding ourselves of our own roles in this regard and what we can potentially do to foster a culture of transparency. We will deviate a bit from our professional lives to look at the general role of transparency and then come back to connect that with our roles as IP professionals. 

To begin considering why transparency is important, it is relevant to look at what exactly transparency means.  First of all, in our everyday lives as consumers, family members, friends and neighbors, we can consider what transparency means to us.  In many aspects of our lives, the law protects our right to transparency. For example if your neighbor wants to build a two story construction, they will likely need a permit and to advertise their intent to  build publicly.  You will have a right to object as well, as an interested party.  Meanwhile if we go to the store to buy a product, the price is displayed as is the weight of the contents and the ingredients.  In many countries the tax on products is included in the display price as required by law.  The practice of listing ingredients more transparently is also a relatively recent development and is constantly improving.  We have symbols and signals such as “fair trade” for coffee, or “not tested on animals” for cosmetics, which provide us with more transparency on the supply chain and sourcing of the product as well as the conditions under which it is produced. As family members we also foster transparency and as children often enter into agreements with parents, based on transparency around a desired behavior. We know that if we don’t meet the expectations given or try to hide our behavior, we will cause conflict.

So given all of these examples in everyday life, imagine we had no transparency for a moment. Imagine arriving at the cash desk in a supermarket and not having any idea what the price of your purchase would be, or buying a bag of pasta and not knowing what it was made of, or a t-shirt, not knowing if it was produced with child labor. These are not circumstances, which we would readily accept.  Perhaps 100 years ago, this was different, but we have become accustomed to making decisions based on reliable information, which allows us to ensure that our principles can be reasonably upheld and that we have predictability in the outcomes related to our daily activities. So with all of these practical examples, what does the Oxford dictionary say? 

Transparency: “the quality of allowing light to pass through so that objects behind can be distinctly seen”

I think this definition is really interesting as it refers to light and the ability to see. When we metaphorically shine a light on activities, statements, processes, practices, pricing etc. we see the reality easily or we notice that even on closer inspection, the full picture remains obscure or indistinct.  

In the business world, there has been nothing short of a revolution when it comes to transparency.  The internet and digital media have given us access to information, which was never so readily available and this allows us, not only to make more informed decisions by researching, but also to verify information provided by suppliers and sellers.  I can read a review of a product I am about to buy to judge the quality claims of the seller, or I can check other sources to judge whether red wine is really healthy or not etc.  The demand for transparency has also led to new services, platforms, media and products on the market, all of them catering to our growing need for information, opinion and products, which can demonstrate that they meet our needs in this regard.  I’m certain that you can think of many brands, which have built their identity around these values.  

Businesses who are not transparent, on the other hand, have often suffered from extreme negative publicity events, stalling sales and severe losses in their market valuations. The human cost of these failures have been enormous as well. People may have had their health affected or lost their lives.  Employees will have lost jobs and management often been removed in order to recover in the wake of the scandal. This is where we start to see the real costs of a lack of transparency versus the value of transparency for businesses who embrace it and build a trusted identity around it. 

As IP professionals we belong to an industry that places a premium on trust. We are trusted with our client’s valued property and their reputation as individuals and as businesses.  IP is a global activity and in particular, pricing and conditions are very complex due to the differing processes among countries, in how they manage IP at a local level.  We are exposed to these variations daily and I believe that this is one aspect of what makes our industry so fascinating, however it also introduces risks, challenges and costs for all parties involved. At a most basic level, patent and trademark offices fees over 180 countries are priced in local currency and  have to be converted to the billing currency.  How this is done, provides an opportunity for transparency or an opportunity to add unnecessary cost.  In the last decade, we have been gifted the technology to allow us to manage such processes, not only transparently but also efficiently. The need to invest undue time and resource in order to manage currency for example, is no longer a reality and should not be accepted as a barrier anymore. The availability of portals, digital communication, PTO internet sites etc. has allowed us to stay on top of fees and verify them.  Again, there is no longer any resource impediment to ensuring that we are paying the correct local fees.  Exchange rates can be checked in real time from various sources and we even have instruments available to lock in rates for predictability. In the IP world we are governed by some of the same laws, which apply to other industries or protect consumers. That said, there is little specific regulation around this area in IP compared to lets say, the food and beverage area or consumer pricing and as a result it is more incumbent on us to lead in the absence of clarity or guidance from our regulators.

Ultimately though, regardless of whether we are aiming to be efficient or not, or whether the law requires it or not, we should see transparency as something positive rather than a nuisance or a cost. If we are unable to manage a cost with certainty, then we should be transparent about this and make our clients aware of it. This is a question of respect and trust.  Regardless of whether we are an in-house professional, IP law firm, or service provider, we must all be able to answer questions to our client, whomever that may be. There is still scope to improve the standards of transparency in IP and if we believe that transparency is critical to our sustained success, the best way to foster transparency is to not only provide it proactively, but insist on it. 

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