Strengthening WIPO’s Governance For The Next 50 Years: A Time For Action

By Carolyn Deere Birkbeck

In 2017, the World Intellectual Property Organization (WIPO) will mark its 50th anniversary. In the lead up to that milestone, the next three years provide a vital opportunity for Member States to update and strengthen WIPO’s governance, both to address current problems and to better equip the organisation for addressing challenges that may arise in the next 50 years.

In August 2014, a UN Joint Inspection Unit (JIU) ‘Report on the Management and Administration of WIPO’ listed a core set of governance problems facing WIPO and recommended that the WIPO General Assembly should: “review the WIPO governance framework as well as current practices with a view to strengthen the capacity of the governing bodies to guide and monitor the work of the organisation.”[1]

At this week’s annual Assemblies of WIPO Member States, governments have a clear opportunity to take up this call; they should agree to establish a Working Group of Member States on Governance, with a mandate to present recommendations for approval in advance of the 2017 WIPO Assemblies. Here, WIPO’s Working Group on Constitutional Reform, which met from 1999 to 2002, which produced a number of practical, constructive recommendations and decisions, sets a useful precedent for such an initiative.

To launch this process, Members should hold informal consultations to take stock of WIPO’s governance system and deliberations to date, and to set priorities for further discussion and action by the Working Group. This informal phase should seek to engage Ambassadors and senior officials in national capitals, as well as the Director General.

Why Does Getting WIPO’s Governance Right Matter?

Governance is about the system by which Member States exercise authority and control over WIPO’s strategic direction and activities, and by which Members and stakeholders hold the organisation to account. WIPO’s governance system relates to the organisation’s legal foundations, the structure of its governing bodies, and its financial arrangements. It also includes formal rules, procedures and policies in respect of WIPO’s decision-making processes, the conduct of its meetings, and program and budget, as well as to WIPO’s financial management, and oversight. In addition, WIPO’s governance system includes its practices with regard to external relations with the UN system, participation of observers, transparency, and the appointment of the Director General. As in most international organisations, informal practices with regard to consultations and consensus building are a de facto part of this governance system.

Getting WIPO’s governance right matters because the institution and subjects it addresses are more important and controversial than ever. At a time when promoting innovation, creativity and more affordable and open access to knowledge and technologies are among the top priorities of all governments, the rules and institutions for governing IP are increasingly relevant to policymakers and the public everywhere. More and more stakeholders demand a voice in decision-making in this area, particularly with rising awareness of how IP laws and policies impact outcomes on a range of public policy issues – from development, public health, and food security to education, privacy, and the environment.

Second, ensuring WIPO’s governance is fit for purpose is vital because WIPO is the primary multilateral forum for discussion of IP issues. It is well-established that multilateralism is threatened by fragmentation through the rising number of bilateral and regional agreements, and by ‘megalateral’ negotiations such as for a TransAtlantic Trade and Investment Partnership (TTIP) and the Trans-Pacific Partnership (TPP). As the UN system’s key agency charged with IP, WIPO represents the best, albeit imperfect, option for pursuing much-needed multilateral approaches to norm-setting and development cooperation, the needs and priorities of developing countries, and the call for a balanced IP system that can serve public welfare goals of all of its Members. To meet these expectations, WIPO needs to be accountable, relevant, and responsive to cutting edge policy debates.

Third, public expectations of good governance in international organisations have risen. When judged in terms of professionalism, financial stability, and its ability to attract engagement of Members and stakeholders, many other UN agencies face far greater hurdles than WIPO. But, consistent with trends in other international organisations – from the World Health Organisation, World Trade Organisation and the World Bank, to the UN’s Food and Agriculture Organisation – WIPO Members should take up the task of ensuring their organisation’s governance is fit for purpose.

Fourth, all WIPO Members have immediate interests in addressing governance problems because they are widely acknowledged to hamper the day-to-day work of the organisation.

On the one hand, many Member States express relatively high satisfaction with some of WIPO’s functions, such as its global IP protection services, the WIPO Arbitration and Mediation Centre, and its information and data services, including PatentScope and the publication of the Global Innovation Index.

On the other hand, Members express a range of concerns about WIPO’s performance in regard to its other core functions, such as in norm-setting, development cooperation and providing a forum for policy dialogue.

Taken together, problems in these areas too often deprive the organisation of adequate strategic direction in respect of critical global debates on the future of the IP system, and weaken the relevance, responsiveness, credibility, and legitimacy of WIPO as a multilateral forum for international cooperation.

Where is WIPO’s Governance Falling Short?

Over the past decades, the full diversity of WIPO Member States and stakeholder groups have articulated a growing number of concerns about shortcomings in WIPO’s governance.

These range from complaints about weak accountability to Member States and poor public transparency; weaknesses in budget oversight and internal management; the dominance of developed countries in agenda-setting and the historical legacy of rules and processes devised primarily by them; a bureaucratic culture that hampers responsiveness to new approaches to IP issues; undue Secretariat influence on treaty negotiation and accession processes; and inadequate opportunities for engagement by public interest NGOs.

Added to these are concerns that WIPO’s financial arrangements carry the risk of the organisation’s ‘capture’ by industry groups convinced that the fees they pay in exchange for WIPO’s services also entitles them to have a decisive influence on the organisation’s other activities.

Although one can point to important successes, such as the conclusion of the 2013 Marrakesh Treaty to Facilitate Access to Published Works for Persons who are Blind, Impaired or Otherwise Print Disabled, WIPO Member States also frequently complain about out-dated and inefficient decision-making processes. Notably, they emphasise the inefficiency of WIPO meetings, treaty negotiations that languish, and Committee meetings that end in stalemate.

Recent examples of such problems include breakdowns in the work of the Committee on WIPO Standards (CWS), the Committee on Development and IP (CDIP), and the Program and Budget Committee (the PBC). Impasses at the PBC earlier this month prevented adoption of recommendations on all items in time for this week’s General Assembly, which in turn can have significant implications for the organisation’s day-to-day work (i.e., the inability to agree on definition of development expenditure hampers the Secretariat’s ability to prepare a draft 2015/16 Program and Budget). Further, the sharp and acrimonious closing remarks of Members at the close of the May 2014 session of the Committee on Development and IP (where Members failed to agree on a process for an independent assessment of the implementation the Development Agenda and other key aspects of the Development Agenda’s Coordination and Monitoring Mechanism) were symptomatic of enduring tensions between Members on WIPO’s role.

Although not all Members or stakeholders agree on the significance of all of these complaints, the conclusions of the 2014 UN Joint Inspection Unit (JIU) report on WIPO’s Management and Administration should provide a firm basis for Member States to reflect and take action on the governance front.[2]

Key concerns raised by the JIU included the complexity of WIPO’s governance structure; paralysis of formal decision-making in many WIPO bodies; and an over-emphasis on informal decision-making. The JIU argued that these problems confuse Member States and frustrate their ability to review and guide the work of the organisation. The JIU also concluded that these problems contributed to ailing trust between Members, frustration with the Secretariat, and the inability of Members to build and sustain a shared vision of WIPO’s mandate, which in turn undermines the prospect of reaching consensus on a range of substantive matters before the organisation. Among other matters, the JIU report highlighted the shift of power toward WIPO’s Program and Budget Committee (PBC) and the limited space for substantive policy deliberations on major strategic matters and challenges facing the organisation, which are too often postponed due to time-constraints, shunted between WIPO Committees, or relegated to opaque informal processes.

Importantly, on many issues, Members fail to agree for good reason – because Member States, and groups within them, have different and evolving interests with respect to IP policy, law and practice. However, recurring breakdowns also reflect deeper governance challenges facing the organisation across its work. In short, weaknesses in WIPO’s governance system can contribute to and exacerbate the challenges governments face in forging compromises and resolving tensions on substantive issues.

Why is Governance at WIPO so Challenging?

The governance challenges facing WIPO are numerous in part because the issues it grapples with are complex, both politically and technically, and the demands upon the organisation have grown.

It is obvious that the world has changed enormously since 1967 (when WIPO was created), and 1974 (when the organisation joined the United Nations system). Further, whereas WIPO was originally created primarily to serve as the administrative and technical secretariat of intergovernmental IP treaties, its functions and range of activities have subsequently expanded (due to the increasing use of its treaties for IP applications and registrations) and diversified (as WIPO now hosts a growing range of activities in development cooperation, dispute resolution, and research). WIPO is also now tasked with addressing complex and highly politicised policy and legal debates. The organisation itself has also grown significantly (from a staff count of 544 in 1992 to 1296 in the year 2013), with a budget of over 670 million CHF for the 2014/15 biennium.

The realm of IP policymaking has always been highly contentious – dominated by private actors with strong vested interests and billions of dollars of investment at stake. Recurring debates between consumers and producers of knowledge and innovation with starkly contrasting interests have been in play since the earliest days of IP laws.

Regulators in the IP arena face rapidly changing technologies, a diversity of business models, and myriad approaches to IP policy, law and practice across the many fields of technology, innovation and creativity. Together, the evolving ecology of innovation and creativity often outstrips the capacity of policymakers to keep up.

In addition, WIPO faces the challenge of managing the divergent interests often expressed by groups of developed countries and developing countries (despite the reality of a range of interests among these groups of countries, and within them). In this context, there is an enduring struggle for the ‘soul’ of WIPO between developed countries determined that the organisation should promote stronger IP protection, and developing countries, arguing that the organisation’s approach to IP should be guided by the broader development and public policy goals of the UN system. Although WIPO does not face the same structural problems with sufficient voice for developing countries as in several other global economic institutions (such as the World Bank where countries do not have an equal vote), developing countries have nonetheless seek to correct a legacy of marginalisation in WIPO’s norm-setting and decision-making.

Political scientists have long noted that, as with national IP institutions, WIPO’s unique self-financing business model makes it highly susceptible to regulatory capture. For several decades, WIPO has raised most of its income through fees paid by IP right-holders and applicants in exchange for global IP protection services established by treaties such as the Patent Cooperation Treaty (PCT). As the range of issues that IP touches grows, however, the expectations regarding WIPO’s engagement with an increasing number and diversity of stakeholders have also grown. Here, WIPO’s challenge is to find mechanisms that work for its traditional stakeholders (such as the associations of rights-holders, IP professionals and the large multinational companies that comprise the main users of its IP protection systems) as well as for the wider range of stakeholders now seeking a voice, such as SMEs, which are the greatest source of innovation and employment in many countries, and the diversity of public research institutions and civil society actors with public interests at stake.

Finally, WIPO has one of the most complex governance structures in the UN system. (This complexity stems from incremental evolution of WIPO’s governance structure, which emerged from the amalgamation of several existing structures going back to the Paris and Berne Conventions of the 1890s, followed by the progressive adding of new treaties).

WIPO’s Governance System as a Work in Progress

The governance issue is not new for WIPO. Recent research at Oxford University on the history of WIPO’s governance[3] highlights that the organisation has been under evolution since its inception.

For many years, WIPO Member States and the Secretariat have understood that WIPO’s governance system can facilitate or impede action on the substantive work of the organisation. They have come together many times to transform and strengthen WIPO’s governance in a range of areas.

Members have, for instance, considered a range of constitutional reform measures aimed at “simplifying and rationalizing” WIPO’s governance structure, ultimately adopting five constitutional amendments (Although only one has formally entered into force, all are followed in practice).

WIPO Members have also approved a range of internal organisational reforms that refine WIPO’s governance system and strengthen its accountability. This has included new or revised policies, rules and regulations on matters as diverse as the accreditation of observers and transparency of documents. Members have also taken decisions to bolster and refine WIPO’s financial management and the framework for independent audit and oversight (such as through updates of the organisation’s Financial Rules and Regulations). In addition, Member decisions to approve new mechanisms for better engaging Member States in the Program and Budget process. They have approved Secretariat initiatives such as the implementation of a Strategic Realignment Program (and its emphasis on Results-based Management), and an Enterprise Resource Planning System, which can be considered governance decisions to the extent that they facilitate the ability of Members to provide strategic direction and exercise effective oversight.

Further, the adoption of 2007 WIPO Development Agenda, which aims to mainstream development throughout WIPO’s work, was not only a governance project (to the extent that it aimed to impact WIPO’s mandate), but also added the CDIP to WIPO’s governance structure.

In short, the organisation has been open to evolution. Yet, there are several governance issues that remain on the table. A diversity of Members from different regional groups has advanced proposals on various governance matters in a number of Committees, and a number of background documents by the Secretariat on governance already exist. The good news is thus that, when deciding to take stock and set priorities on governance, neither Members nor stakeholders need start from scratch.

A key stumbling block to action, however, is that debate on different aspects of governance reform is currently dispersed across several different WIPO bodies, most notably the WIPO General Assembly, the PBC, the CDIP and Independent Advisory Oversight Committee, and to some extent in the Assemblies of the Unions. Collectively, this means that the governance debate at WIPO suffers from a long ‘shopping list’ of reform ideas and proposals on a broad range of issues. This predicament is further frustrated by a chaotic, sporadic and reactive process of discussion that meanders timelessly through Committees with agendas too full to offer adequate time for reflection.

Priorities for Discussion

Amidst the broad range of governance matters that Members could consider in a reflection process, highest in the minds of governments should be those that facilitates international cooperation where their interests align, and that better equip them to manage tensions constructively and achieve balanced compromises where their interests diverge.

Following are six examples of where WIPO Member States clearly share interests:

1. improving the efficiency and transparency of decision-making processes. This could include attention to practical challenges related to the efficiency of WIPO meetings, including with respect to decision-making processes, the selection of Chairs, meeting documentation; and the legal status of Chair’s reports and summaries. Several of these matters could be addressed through an updating of WIPO’s General Rules of Procedure (last amended in 1979).

2. completing work to improve WIPO’s oversight framework, a core vehicle for ensuring accountability of the organisation.

3. developing guidelines for consultations with regional groups and coordinators, and policies with respect to engagement with the diversity of relevant stakeholders in WIPO’s activities and partnerships (not just in their role as Observers).

4. devising processes for feedback and review of WIPO’s Directors General performance throughout the terms of their appointment.

5. addressing challenges that go to the heart of WIPO’s governance system, most notably the complexity of WIPO’s governance structure and mandate. Members should carefully consider proposals for simplifying WIPO’s governance structure; creating an Executive Body; reviewing the role of the PBC and external offices; sustaining attention to the on-going task of mainstreaming development in WIPO’s work, including through implementation of the Development Agenda Monitoring and Coordination Mechanism; and forging greater space within WIPO’s committee structure for high-level policy deliberation and debate on substantive matters and tensions. WIPO’s Members should also pursue a constructive, forward-looking dialogue on their understanding of the mandate(s) of the organisation.

6. reaching a shared vision with regard to the organisation’s financial arrangements, notably in respect of its core income streams (most notably from fees, but also government contributions, voluntary Funds in Trust, and other potential partners and donors), their sustainability, and their implications for WIPO’s strategic direction and its accountability to Members and the diversity of its stakeholders.

A Governance Process as a Legacy for the Future

In sum, as WIPO approaches its 50^th anniversary, Members should this week seize the opportunity to launch a serious forward-looking process of reflection and action on governance. The Chair of the WIPO General Assembly and the Director General in their roles as facilitators, should embrace this prospect. They have before them a critical opportunity to make their legacy one of ensuring WIPO’s governance is fit to face the challenges and priorities – some enduring, some new – of the next 50 years. The JIU’s 2014 report serves as a critical reminder that governance issues should not slip between the cracks at WIPO.

Dr. Deere Birkbeck is a Senior Researcher at the Global Economic Governance Programme, co-hosted by University College and the Blavatnik School of Government at the University of Oxford.

[1] See JIU (2014) Review of Management and Administration in the World Intellectual Property Organisation (WIPO), JIU/REP/2014/2. United Nations Joint Inspection Unit: New York, p. i.

[2] JIU (2014) Review of Management and Administration in the World Intellectual Property Organisation (WIPO), JIU/REP/2014/2. p.2. United Nations Joint Inspection Unit: New York.

[3] Deere Birkbeck, C. (2014) “The Governance of the World Intellectual Property Organization: A Review of Reforms (1967-2014)”, GEG Working Paper 2014/93, Global Economic Governance Programme, University College and Blavatnik School of Government, Oxford.

Image Credits: WIPO