Who is more likely to compromise your Intellectual Property (IP): internal employees or external hackers?

Who is more likely to compromise your Intellectual Property (IP): internal employees or external hackers?

In the fast-paced world of IT and technology, a troubling trend has emerged. More than a quarter of firms in this sector have leaders who have not had their qualifications, experience, or criminal records checked, according to recent findings.

This lax approach to due diligence is concerning, especially given that eight out of ten senior leaders in the UK's largest tech companies believe their firms are at greater risk from internal issues such as poor leadership and potential IP theft, than from external threats.

The reasons for this lack of scrutiny are varied. In many cases, it seems that it is simply presumed that someone applying for a leadership position can be trusted and that their application and interview are entirely accurate. This assumption, however, can be risky, as over half of successful applications contain errors.

The importance of thorough background checks is further emphasized by the fact that during mergers and acquisitions, two boards often come together who have different minimum requirements or values. This inconsistency in leadership checking during mergers and acquisitions may be a contributing factor to why leaders are not being checked more consistently.

The business world is starting to realise the importance of due diligence on candidates, and discussions during mergers are increasingly focusing on lessening the chances of a scandal emerging at a later date. In the wake of high-profile reputational scandals, ensuring that everyone in a company has the skills and experience they say they do is becoming increasingly important.

The research shows that in over half of IT and technology companies, screening has exposed a leadership lie - the highest of any sector. This is a significant finding, as poor leadership can lead to the implementation of poor processes to protect against IP theft.

Interestingly, IT and technology companies in Germany are leading the way in this regard. They ensure their leadership's qualifications, experience, and criminal backgrounds are checked through structured pre-employment screenings and background checks often conducted by specialized third parties or detective agencies. These checks include verification of resumes, criminal record searches, financial status, and sometimes personal surveillance to prevent hiring unsuitable candidates, especially for managerial roles.

Personal recommendations also play a significant role in recruitment decisions, with over three-quarters of IT and technology firms relying on them. However, this method can be unreliable, as people at any level are capable of embellishing the truth, either because they need to secure a job or because they intend to cause harm.

In response to these concerns, more than a third of HR directors admitted that people have been hired who would not have been if proper background screening had been conducted. This underscores the need for stricter screening procedures and a more rigorous approach to leadership recruitment in the IT and technology sector.

As IP battles are likely to intensify, and changes can't come soon enough, organisations must take steps to ensure they have the right leaders in place to navigate these challenges. The reputation of the business, as well as its performance, depends on it. Reputational risk is rising up the boardroom agenda in more than half of IT and technology companies, and this trend is expected to continue.

Read also:

• IM Motors reveals extended-range powertrain akin to installing an internal combustion engine in a Tesla Model Y
• Ford Embraces Silicon Valley Approach, Introducing Affordable Mid-Sized Truck and Shared Platform
• Future Outlook for Tesla in 2024: Modest Expansion in Electric Vehicle Sales, Anticipated Surge in Self-Driving Stock
• Vegetable oils are similarly utilized in the process of road cleaning.