Document(s) 6 of 17

INTRODUCTION

The implementation of the WIPO Development Agenda will depend upon reforms to the agency’s governance.¹ At the 2007 WIPO General Assemblies, several of the recommendations on the Development Agenda adopted by member states proposed particular governance reforms (WIPO 2007). Alongside specific proposals for improvements, this article argues for consideration of a deeper overhaul of WIPO’s governance, including the internal management and working practices within the WIPO Secretariat, reforms to decision-making processes among member states and member oversight of the Secretariat, strategies for altering the Secretariat’s institutional culture, and alternative institutional arrangements, including with respect to how WIPO is financed.

WHAT IS WRONG WITH WIPO’S GOVERNANCE?

Governance-related deficiencies at WIPO were key factors that prompted the Friends of the Development to push for the Development Agenda. WIPO’s institutional culture has long been characterized by opaque decision making, a pro-intellectual property (IP) outlook, and an imperial management style (Musungu 2005; Halbert 2007; May 2007). Since it became a United Nations (UN) agency in 1974, WIPO has known only two directors general. Together, their legacy has included a narrow technocratic approach to IP law that has neglected public policy considerations, a bias in favour of the interests of IP right-holders and developed countries, and an institutional momentum in favour of stronger IP rights and new global IP rules (Boyle 2004). The Development Agenda emerged as a direct challenge to this institutional culture and to the intensity of WIPO’s pro-IP commitments (Chon 2006; Menescal 2008; Netanel 2008). While the former director-general, Kamil Idris, launched several efforts to address some developing country concerns, particularly by expanding WIPO’s capacity-building activities, the debates on the Development Agenda confirm that developing countries as a whole remain far from persuaded that such efforts are adequate (Idris 2003; WIPO 2004, 2007). Indeed, for the countries that form the Friends of Development coalition at WIPO, the content and quality of WIPO’s capacity-building is a key issue they hope to address through the Development Agenda (South Centre 2004).

Beyond WIPO’s internal culture, its institutional design and, in particular, its unique financing arrangement present challenges for the implementation of the Development Agenda. While member states formally approve WIPO’s program and budget each year, the primary financiers of WIPO are the users of the system of international IP treaties that WIPO administers, which are mostly multinational corporations from developed countries. While several of the larger developing countries are becoming more active users of WIPO’s services, such as those related to the Patent Cooperation Treaty, developed countries will continue to dominate for the foreseeable future. The WIPO Secretariat openly views the IP holders that use its services as its core non-government constituency. In 1988, the incumbent WIPO director-general established an Industry Advisory Commission to ensure that the organization responded to industry needs and enable their direct input into decision making (Musungu and Dutfield 2003). Over 90 percent of the non-governmental organizations (NGOs) accredited as being permanent observers to WIPO’s work are the companies, associations of IP holders, and other interested groups, such as IP attorneys.

WIPO’s governance is also weak in terms of its accountability to member states and its relationship with the public at large. Often misperceived as an agency dealing only with technical issues, WIPO largely escaped public scrutiny until a few years ago. Interaction with WIPO was left to a small technocratic community of IP officials and lawyers spurred on by major commercial interests (Braithwaite and Drahos 2000). This relative obscurity was reinforced by the nature of WIPO’s relationship with its primary interlocutors at the national level, namely IP offices that in most countries operate away from the spotlight of public debate and policy discussion within government (Deere 2008b).

The capacity for developing country delegations to provide effective oversight of WIPO and serve as effective advocates of change is circumscribed in several ways. First, over time, a technocratic rapport has emerged between the staff of the WIPO Secretariat and those of many developing country IP offices, many of which rely on WIPO for capacity building, technical assistance, and training. Through such activities, and the normal day-to-day processes of engagement at WIPO meetings and conferences, the WIPO Secretariat has been effective at reproducing a pro-IP perspective among many of the developing country delegates charged with oversight of the organization (May 2007). In most developing countries, WIPO is perceived as an agency with considerable technical authority, and staff of national IP offices consistently defer to it for advice. Second, many staff in national IP offices benefit personally and professionally from WIPO’s training and travel opportunities (as well as from the lucrative per diem payments that it provides). Delegates to WIPO meetings perceive their primary role as one of securing further capacity-building and technical assistance from the agency. In the context of ongoing norm-setting processes, it should not surprise us that this dependence can skew the incentives facing national IP officials, particularly from weaker developing countries, leading them to agree to outcomes favoured by the WIPO Secretariat and key developed country members (Abdel Latif 2005; May 2007). Third, WIPO’s practice of organizing consultations and government input on a regional basis has been criticized by some for weakening the ability of developing countries to organize globally or thematically in regard to specific debates at WIPO (Kwakwa 2002; Yu 2007; Visser 2007; Abdel Latif 2005).

A further challenging aspect of WIPO’s governance concerns decision-making processes. There is inadequate day-to-day oversight of the Secretariat by WIPO member states—a fact highlighted by recent evidence of financial mismanagement (New 2007). The WIPO Coordination Committee, charged with overseeing the organization between the annual General Assemblies, which gather all WIPO members, is widely acknowledged as being unwieldy, with a membership of over fifty countries. The engagement of many members of the Coordination Committee is often too weak to ensure effective oversight. Using the terminology of organizational theory, the result is that the principals (WIPO member states) exercise inconsistent control over their agent (the Secretariat) (Hawkins et al. 2006). In the vacuum that results, the political space is open for particular member states and vested interests to dominate, for the Secretariat to advance a bureaucratic agenda in favour of institutional growth, and for the institution to be harnessed by disreputable staff to deliver personal favours or secure personal benefits.

In the absence of adequate oversight, severe problems in internal management have developed, including low staff morale, poor human resources policies, and numerous allegations of financial irregularities and corruption (New 2007). To date, the staffing pool at WIPO has suffered three shortfalls: it is overly technocratic, draws too heavily on the diplomatic community and former industry lobbyists, and is dominated by a pro-IP perspective. Hiring practices have been non-transparent, and a revolving door has enabled key staff to move between government IP offices, Geneva missions, corporate lobbying firms, and the WIPO Secretariat.

All organizations, particularly government institutions, are difficult to change in both the short term and the long term. The challenge is particularly strong in the case of international organizations where change demands collective decisions, action and oversight from member states (Haas 1990). At WIPO, the secretariat is a large international bureaucracy with over a thousand staff members and an annual budget of around US$550 million. Debates on the reform of the World Bank, International Monetary Fund (IMF), and a range of UN agencies over the past decade have drawn attention to several tools that the membership of international organizations can use to stimulate reform, including alterations to approved work programs, instructions to alter staffing, decisions to revise budgets, and the withholding or withdrawal of financial support. In addition, the scholarly literature on improving the accountability of international organizations emphasizes options such as changes to the practices and procedures of decision making and budgeting, the organization’s mandate, or the leadership of the agency (Woods 2008). Decisions to introduce new evaluation mechanisms and financing arrangements can also alter the incentives at play within the organization. The appropriate tools vary according to the objectives at hand, which might range from improving efficiency or cost effectiveness to mainstreaming an organization’s orientation toward the needs of developing countries.

What kind of governance reforms would promote and enable the change necessary to advance the goals of the Development Agenda? Importantly, implementation of the WIPO Development Agenda will demand a culture shift in global IP policy making that will require far more than internal governance reforms at WIPO. That said, governance reforms at WIPO are vital among the range of actions needed both within and beyond the organization to translate the Development Agenda into practice.

IMMEDIATE ACTION

To fulfil the promise of WIPO’s Development Agenda, the goals of governance reforms should include greater accountability, effectiveness, and development orientation. Reform of WIPO’s governance could be undertaken in two phases. To begin, WIPO’s member states and senior management could take several immediate steps to reorganize and improve internal management practices that would boost the long-term prospects for WIPO’s Development Agenda. At the same time, governments should initiate a discussion on further, deeper reforms to WIPO’s institutional design and structure, which will demand deeper, longer, and more political deliberation. That discussion should include a fundamental reconsideration of how the range of functions currently clustered within the WIPO Secretariat might be better organized, managed, and financed.

In order for both this short- and longer-term agenda to advance, concerted efforts to transform the institutional culture at WIPO will be necessary. Firm and enlightened leadership by the new director-general will be critical, albeit not sufficient. The new director-general must embody, and be perceived to embody, the objectives and values advanced in WIPO’s Development Agenda. This will demand more than commitments to improve technical assistance and capacity building for developing countries. The director-general must exemplify an interest in public policy goals beyond the technocratic discussions of IP norms and administration, as well as a willingness to move beyond the mindless reiteration of the absolute benefits of IP. He must show himself to be a listener who enjoys and commands the full support and respect of the diversity of WIPO’s members and stakeholders.

The top tasks of the new director-general must be to undertake a series of internal reforms to restore confidence in financial and human resources management, improve accountability to member states, and demonstrate an active commitment to concrete changes in the activities of the organization to reflect WIPO’s Development Agenda. To this end, the new director-general needs to draw together a professional team experienced in the management of organizational transformation that will champion and implement change.

A critical component of this effort must be reforms to staff management and recruitment policies. Such changes will demand tough decisions to upgrade norms of staff conduct and practices, including those that apply to consultants. The Secretariat should propose a new code of ethics to complement the standard UN codes governing all staff, which would demonstrate to WIPO members and the public how seriously the senior management takes issues of accountability. Change will demand a recruitment policy that focuses on going beyond the usual pool of candidates to attract a more diverse, multi-disciplinary staff. It will also demand efforts to retain high-quality staff that could serve as internal agents and promoters of change.

New leadership will not, however, resolve all of the challenges. WIPO’s membership also has work to do. It needs to provide clear instructions to the WIPO Secretariat regarding the reform agenda. Immediate decisions that members should consider include:

1. A New Policy for Public Consultation and Participation

The prospect of a more development-friendly WIPO will depend upon an expansion of the community involved in IP policy decision- and law-making beyond the grip of IP lawyers, industry lobbyists, and technocrats. To match the best practices in other international organizations, there is a need for clear policy guidelines for transparency and public access to meeting documents and also for public consultation and participation across all of WIPO’s activities (e.g., training, meetings, research, impact assessments, capacity building, and norm setting). Such mechanisms should supplant WIPO’s existing Industry Advisory Commission and Policy Advisory Commission. Increased civil society participation in the Development Agenda meetings, various public symposia, and the Intergovernmental Committee on Genetic Resources, Traditional Knowledge and Folklore should be replicated elsewhere in WIPO and across its various functions.

2. An Expanded Office of External Relations

Beyond efforts by WIPO member states and external stakeholders to promote change at WIPO, the consolidation of informal and formal partnerships with other UN agencies could help bring a more development-oriented perspective to the organization. Dialogue with the family of international agencies and inter-governmental processes will help the Secretariat and its member states identify how WIPO and its new Development Agenda can contribute to the achievement of overarching UN priorities, such as the UN Millennium Development Goals. WIPO could also take a more active role within the UN system by co-convening and participating in policy debates on the global IP system and its relevance to a broad range of issues, including innovation, access to knowledge, development, trade, energy, climate, environment, agriculture, and public health. Importantly, WIPO’s members and external stakeholders will need to ensure that such partnerships do not become vehicles for promoting deference in the UN system to WIPO where issues of intellectual property arise in debates on global challenges. Instead, they should provide opportunities to bring new perspectives to WIPO and for WIPO to enrich and inform global discussion with development-oriented perspectives and expertise on IP, consistent with the Development Agenda. Importantly, the prospect of a network of institutional partnerships also poses the risk of diluting the capacity of members, particularly developing countries, to properly monitor what role WIPO plays in them and the nature of the agenda it advances. The Office should also be responsible for enhancing WIPO’s partnerships with civil society, academia, and the private sector and ensuring implementation of its policy for public consultation and participation.

3. An Independent Evaluation Office

The mandate of this office should be to provide evaluation services for all of WIPO’s activities against benchmarks of effectiveness, accountability, and development orientation. Learning from the experience of the IMF, an Independent Evaluation Office for WIPO should be structured to have the autonomy and authority to investigate and report on matters without interference from particular members, the Secretariat, or stakeholders (Woods 2008). It should have its own executive director who is appointed by and reports directly to the WIPO General Assembly, as well as an independent budget approved by the membership.

4. A Research and Impact Assessment Unit

The credibility of research and impact assessment relies upon independence. WIPO member states and the Secretariat need to be involved in these activities, but a unit charged with these tasks should be managed in a way that ensures its standing as an unbiased and independent authority. A new Research and Impact Assessment Unit should, on the basis of work plans and a budget approved by the General Assembly, undertake ongoing activities in three areas: (1) research requested by the General Assembly and various committees; (2) development and public interest impact assessments of proposed and existing treaties and norm-setting initiatives; and (3) responses to requests for research by particular countries. The unit would report annually to the General Assembly and its Coordination Committee. The unit’s ongoing activities should, however, be overseen by an expert board (ten experts selected by WIPO members, with consideration for regional representation and expertise) and managed by a managing director appointed by the expert board and subject to yearly performance reviews. The unit’s work would be evaluated annually by the Independent Evaluation Office. Staffed by a small multi-disciplinary team of economists, lawyers, and development specialists, it would be charged with working in partnership with experts and researchers in countries and regions from academia, industry, NGOs and government to implement its workplan. Importantly, the Reseach and Impact Assessment Unit should not serve to build and concentrate expertise in Geneva. Rather, it would operate as a research network and clearing house, with a focus on building processes at the national level to foster local IP research capacity and expertise.

5. Reorganizing Capacity Building

WIPO’s capacity-building activities, which include education, training, technical assistance, and infrastructural support, should be separated from WIPO norm-setting processes. A new Capacity Building Unit should receive its funding and mandate from the General Assembly, but its work program should be set by its own board that is comprised equally of donor and recipient countries. The managing director should be hired and reviewed by this board. The board and the managing director would in turn report annually to the WIPO General Assembly. The unit would accept contributions through special trust funds and voluntary funds. The work of the unit would be evaluated annually by the Independent Evaluation Office based on criteria derived from the recommendations made in the context of the WIPO Development Agenda and from internationally agreed principles to improve ownership of development assistance, such as those set forth in the OECD’s Paris Declaration on Aid Effectiveness.² Each recipient and donor country interacting with the unit would be required to involve representatives of both their development/foreign affairs agencies and their IP agencies. The provision of capacity building would be linked to diagnostic studies that assess capacity building needs in light of national development and poverty alleviation goals and that draw on consultative processes at the national level. The process would also involve participation from donors working on other aspects of the country’s public administration. To implement projects, the unit would draw on a range of capacity-building providers and experts according to the preferences and needs of the country at hand. According to choices made by countries, projects could be led by, or involve, experts from NGOs, private law firms, industry, other UN agencies, as well as WIPO staff involved in treaty administration and research.

Each of these five proposed reforms will likely encounter some internal resistance from the WIPO Secretariat and from some member states. Progress will require the director-general to be open to negotiation and consultation with member states regarding reform. The challenge will be for the Secretariat and the member states to balance the already well-heard but legitimate voices of private IP holders with those of development and public interest advocates. Some WIPO staff are already keen to support a process of an internal renewal. With confident leadership, these staff could help WIPO to deliver on the new priorities set forth in the Development Agenda recommendations.

Critically, achieving greater effectiveness, accountability, and development orientation at WIPO will rely on efforts by member states to improve oversight of the Secretariat and to engage in a critical assessment of their own performance. Most notably, member states must:

• build national IP policy-making processes that engage the full range of relevant national ministries and non-governmental stakeholders from industry, civil society, and the research community. In order for development-oriented IP reforms at WIPO to advance, national IP policies in both developed and developing countries, as well as their strategies with respect to international negotiations and the global IP system, must also reflect development goals.
  
  
• improve the quality of their own participation in WIPO meetings. This will require boosting the accountability of national representatives to WIPO. Governments should broaden the composition of their delegations to WIPO to include representatives of the ministries of foreign affairs, development, agriculture, and education, where appropriate. WIPO members should also reconsider whether IP offices alone are the most appropriate national focal points for interaction with WIPO.
  
  
• uphold the principles of the Development Agenda in their national decision making and norm setting. In order for WIPO’s activities and processes to reflect the goals of the Development Agenda, governments must engage in an ongoing process of consultation with relevant private and public interest groups and experts. With these improvements in hand, governments should commit to, and operationalize, new principles for WIPO’s norm setting (set out in Table 1).

Table 1: Principles for WIPO Norm Setting

Guided by principles advanced by WIPO members in 2007, the norm-setting activities of WIPO should:

• be member-driven and based on transparent work plans and strategic vision;
  
  
• take into account differences in the level of economic, social, and technological development among members;
  
  
• preserve and protect a robust and lively public domain;
  
  
• be fully compatible with, and actively support, other international instruments that reflect and advance development objectives, such as international human rights instruments;
  
  
• provide developing countries with policy space commensurate to their development needs and requirements through flexibilities, exceptions, limitations, and the provision of protection adequate to the level of development and national conditions of each country;
  
  
• reflect careful, evidence-based impact assessments of costs and benefits to different stakeholders and countries;
  
  
• be preceded and effectively guided by debates and public hearings, with open participation by all member countries and all stakeholders, with a view to assessing potential impacts as well as the desirability of new norm-setting activities; and
  
  
• include provisions on objectives and principles to curb anti-competitive practices and abuse of monopoly rights, promote technology transfer of technology, and provide longer compliance periods for developing countries, as well as to enable the use of flexibilities and “policy space” for the pursuit of public policies, and to include safeguards, exceptions and limitations where relevant for public policy goals.

Source: WIPO (2007).

ISSUES FOR FURTHER DEBATE

Implementing WIPO’s Development Agenda will also demand systematic attention to proposals for deeper governance, such as (1) improving oversight by creating an executive group of member states (bringing WIPO in line with many other international organizations); (2) separating WIPO’s norm-setting processes from other organizational functions, such as treaty administration; and (3) insulating the management of WIPO’s capacity-building activities from undue influence on the part of any member states, the Secretariat, or public stakeholders, whether IP right-holders or advocacy groups. Following are several options that WIPO members could consider:

1. An Executive Board

WIPO members should consider establishing an executive board comprised of representatives of no more than twenty-five WIPO members to oversee the organization’s budget and work program on a monthly basis and to report annually to the WIPO General Assembly. The executive board would combine the functions of the existing Coordination Committee and the Program and Budget Committee. It would also be responsible for hiring and reviewing the performance of the director-general. Several options for electing representatives could be discussed. One option would be to follow the example of the World Health Organization where positions on the board rotate among groups of countries who must nominate qualified national representatives.

2. Restructuring the WIPO Secretariat

Consideration should be given to reorganizing the activities of the WIPO Secretariat. Headed by the WIPO director general, the Secretariat should retain its mandate to provide services to the General Assembly and its committees as well as to ongoing norm-setting processes, and to manage the agency’s core budget. The other existing activities of the Secretariat, such as treaty administration, capacity building, and research could be delegated to semi-autonomous units with distinct heads and management structures as described above (e.g., a Research and Impact Assessment Unit, a Capacity Building Unit, an Office for Independent Evaluation, and a Treaty Administration Unit, discussed below). WIPO would thus be transformed from a single, centralized, top-down bureaucracy to a system of interlocking parts with governance structures appropriate to the objectives and activities of each function.

3. A Treaty Administration Unit

On the basis of a work plan and budget approved by the WIPO General Assembly, a Treaty Administration Unit could be responsible for activities in two areas: (1) administration of WIPO’s twenty-three treaties and (2) arbitration and mediation related to IP disputes. The Treaty Administration Unit could be involved in norm-setting processes, but only to the extent that members call upon it to provide information or advice. Similarly, the unit would not be a direct provider of training, technical advice, or capacity building to countries, although it would participate in activities organized by the Capacity Building Unit as an information-provider. Fees that the unit collects for treaty-related services provided to IP right-holders and other clients would be channelled directly to WIPO’s central budget and distributed to the priority activities of the organization, according to the workplan and budget approved by the General Assembly. The Treaty Administration Unit would have a managing director appointed by the executive board for three years and would be subject to periodic evaluation by the Independent Evaluation Office.

4. Reconsider Practices Related to Regional Groups

Governments should also consider different options for organizing collectively to ensure their interests are properly represented and they effectively execute their oversight responsibilities. To this end, a careful evaluation of the benefits and risks associated with the use of regional groupings to generate consensus in WIPO’s norm-setting activities and to organize the Secretariat’s interactions with member states should be undertaken.

Finally, to ensure proposals for improved governance attract the careful consideration they warrant, WIPO member states should not let them languish in tortuous inter-governmental negotiation processes. Instead, they should follow the example set by many other international organizations and call for an independent evaluation of WIPO’s governance that would consider a full range of options for ensuring that WIPO better addresses the needs of its full membership and fosters a global IP system that more fairly balances IP protection, development priorities, and the public interest. Meanwhile, the Friends of Development will also need to intensify their effort to sustain support among the diversity of member states and within the organization for the Development Agenda.

NOTES

The views expressed in this chapter are personal and do not reflect those of any institution with which the author has an affiliation.

¹ Development Agenda for WIPO, http://www.wipo.int/export/sites/www/ip-develop-ment/en/agenda/recommendations.pdf.

² Paris Declaration on Aid Effectiveness, 2005, http://www.oecd.org/dataoecd/11/41/34428351.pdf.

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Deere, Carolyn. 2005. “Elements for a Code of Ethics for Providers of IP Technical Cooperation.” Paper presented at the Dialogue on Intellectual Property and Sustainable Development: Revising the Agenda in a New Context, sponsored by ICTSD and UNCTAD, Bellagio, Italy, 24–28 October.

——. 2008a. The Implementation Game: The TRIPS Agreement and the Politics of Intellectual Property Reform in Developing Countries. Oxford: Oxford University Press.

——. 2008b. “The Politics of Intellectual Property Reform in Developing Countries: The Relevance of the World Intellectual Property Organization.” In The Development Agenda: Global Intellectual Property and Developing Countries, ed. Neil Weinstock Netanel. Oxford: Oxford University Press.

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——, and Graham Dutfield. 2003. Multilateral Agreements and a TRIPS-plus World: The World Intellectual Property Organization. Quaker United Nations Office, TRIPS Issues Papers no. 3, http://www.quno.org/geneva/pdf/economic/Issues/Multilateral-Agreements-in-TRIPS-plus-English.pdf.

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——. 2008a. Committee on Development and Intellectual Property, First Session Geneva, March 3–7, 2008—Summary by the Chair, http://www.wipo.int/edocs/mdocs/mdocs/en/cdip_1/cdip_1_summary.pdf.

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Document(s) 6 of 17