The Taiwan Association of Intangible Assets and Business Valuation successfully hosted the "ESG and International Intellectual Property Valuation and Operation Summit Forum" on the afternoon of November 6 at National Taipei University of Business. The event focused on exploring the effective integration of ESG (Environmental, Social, and Governance) factors into valuation and appraisal practices. The forum attracted numerous experts from academia and industry, fostering valuable discussions on the application, benefits, and challenges of incorporating ESG considerations into evaluation processes.
The keynote speech at the conference was chaired by Prof. Robert Kua-Terng Su, Honorary President of the Taiwan Association of Intangible Assets and Business Valuation, and delivered by William Hanlin, President of the International Association of Certified Valuation Specialists (IACVS). The keynote address, titled "Assessing and Reporting ESG Considerations in Valuation and Appraisal Work," covered foundational concepts of ESG (Environmental, Social, and Governance), its historical context, significance, international standards such as those established by the IVSC, data collection and analysis, and strategies for integrating ESG risks into valuation reports. In his address, President William Hanlin provided an in-depth analysis of ESG's role in modern valuation and appraisal practices, framing it through a historical and contextual lens. He highlighted that the concept of ESG first emerged in the 1960s and gained prominence through pivotal events, such as the 1989 Exxon Valdez oil spill, the 1997 Kyoto Protocol, and the 2015 Paris Agreement. These milestones drove regulatory bodies to mandate corporate disclosure of ESG ratings, emphasizing ESG's critical role in investment decisions and sustainable corporate development.
President William Hanlin emphasized the need for a comprehensive integration of ESG evaluation processes, spanning data collection, analysis, and report preparation. He highlighted that data must possess both "relevance" and "reliability," aligning with international valuation standards such as IVS 106. The speech further detailed how ESG factors can be incorporated into three common valuation methodologies. For the asset-based approach, considerations include replacement or reconstruction costs. In the market-based approach, ESG risks in comparable transactions are analyzed. For the income-based approach, adjustments are made to cash flows or discount rates. President Hanlin also recommended the use of tools such as questionnaires and "analytical assessment templates" to systematically collect data, ensuring accuracy in evaluation results.
President William Hanlin addressed the challenges in ESG evaluation, noting that while historical data may be reliable, it is not always relevant, whereas forward-looking data, though relevant, may lack reliability. He emphasized that in the absence of concrete data, appraisers must rely on professional judgment, taking care to avoid personal biases that could affect outcomes. The speech also highlighted how ESG factors influence the Weighted Average Cost of Capital (WACC), including their impact on equity costs, interest rates, and Beta. President Hanlin advocated for greater reference to international standards and practical experience in ESG evaluations to enhance decision-making transparency and fairness in the future.
The keynote speech was followed by three presentations from industry experts.
The first presentation was chaired by Prof. Huoshu Peng, Honorary President of the Taiwan Association of Intangible Assets and Business Valuation, and delivered by Dr. Zhi-li Sun. The topic of the presentation was "Principles of ESG Valuation, Biopharmaceutical Patent Valuation, and Operational Practices." Drawing on her extensive research experience, Dr. Sun provided a detailed explanation of how ESG valuation principles can be integrated into the practical application of biopharmaceutical patents, from technical value assessment to patent licensing operations, helping companies develop more competitive strategies in a rapidly changing environment. Dr. Sun emphasized that the value of patents extends beyond financial returns, serving as a critical resource for achieving ESG objectives. She conducted an in-depth analysis of the main purposes and applications of intellectual property valuation, including investment evaluation, transaction pricing, financial reporting, tax planning, and legal use cases. She particularly stressed the need to consider diverse variables in patent valuation, such as market demand, technological uniqueness, industry competition, and product lifecycle. These factors not only impact the immediate market value of assets but also determine their potential for future earnings. Additionally, Dr. Sun demonstrated, using international case studies, how market-based, cost-based, and income-based approaches can be applied to provide a comprehensive value judgment for intellectual property.
In addition, Dr. Sun provided a detailed explanation of the core process for evaluating biopharmaceutical patents, from preliminary data collection and market analysis to subsequent economic value assessment. She demonstrated how the risk-adjusted net present value (rNPV) method can be applied to evaluate the value of new drug technologies. Dr. Sun highlighted that this approach is particularly critical for resource-constrained companies, as it enables them to more accurately forecast the returns and risks of research and development investments, thereby improving the precision of their overall strategic decision-making.
The second presentation was chaired by Prof. Hsing-Chin Hsiao from the National Taipei University of Business and delivered by Mr. Jin-Rong Wu, General Manager of Microdrive Technology Co., Ltd. The presentation, titled "The Current State, Future, and Challenges of the Global Semiconductor and Artificial Intelligence Markets," began with an overview of the development of the semiconductor industry, tracing its history from the invention of the transistor at Bell Labs in 1947 to the birth of integrated circuits and the founding of Intel. General Manager Wu elaborated on how early technological breakthroughs significantly impacted the global semiconductor market, presenting a rich historical context that demonstrated how technology has driven market growth. He further analyzed current global trends in semiconductor market revenues and applications, specifically highlighting the significant revenue growth of TSMC in 2024 and its strong market share in core sectors. Mr. Wu emphasized that Taiwan, as a global leader in wafer foundry, will continue to strengthen its technological capabilities and market influence. However, he also noted the ESG challenges Taiwan faces, such as water resource scarcity and insufficient green energy supply, which require urgent attention.
The second part of General Manager Wu’s presentation focused on the rapid development of Artificial Intelligence (AI). Mr. Wu reviewed AI's evolution, from its origins at the Dartmouth Conference in 1956 to the breakthroughs in generative AI, such as ChatGPT, highlighting the market's anticipated exponential growth. He explained how advancements in NVIDIA's GPU technology and deep learning models have enabled AI to be widely applied across industries, including manufacturing, commerce, and healthcare. Using NVIDIA's dominance in the GPU market as an example, General Manager Wu provided an in-depth analysis of the surging demand for AI chips and their future growth potential. He also addressed the shared challenges facing the semiconductor and AI industries, such as the high energy demands of data center operations and the insufficiency of green energy supplies. General Manager Wu concluded by emphasizing that global tech giants like Google, Meta, and Tencent are accelerating their development of AI solutions, and that Taiwan's semiconductor industry must simultaneously enhance resource efficiency and technological innovation to remain its competitive in the global market.
The third presentation was moderated by Chien-Pu Chin, who is the Patent Attorneys Association of the Republic of China, and delivered by Mr. Cheng-Ta Chen, a patent attorney from Broad flow Intellectual Property Office, on the topic of "Technological Innovation and Patent Value: A Key Driver for ESG Transformation." Drawing from his practical experience, Attorney Chen explained how the integration of technological innovation and patent strategies can help businesses enhance their competitive advantage during the process of sustainable transformation. The presentation initially focused on how patent value is reflected in the core issues of ESG. Attorney Chen highlighted that patents are not only a representation of a company’s asset value but also an effective tool for achieving ESG objectives. For instance, the application of green technology patents allows businesses to achieve more efficient resource utilization and pollution reduction while simultaneously strengthening market competitiveness. Moreover, the cross-border licensing and transfer of patents can promote sustainable development globally, providing strong support for the realization of ESG goals.
The presentation featured multiple case studies to illustrate the practical application of technological innovation and patents. For instance, ECOCO leveraged AI classification technology to enhance recycling efficiency, enabling PET bottle materials to meet international food-grade standards. Similarly, the ZecZec Cup addressed the recycling challenges of disposable paper cups through its foldable design, offering a product that combines practicality with environmental value. These cases demonstrated how patented technologies can effectively reduce resource waste in traditional industries through innovative designs, achieving a win-win scenario for both ESG goals and economic benefits. Attorney Chen further emphasized that patent valuation is a critical component in technology operations and market strategy. He analyzed how the market approach, income approach, and cost approach can be employed to comprehensively assess the technological value of patents, ensuring optimal commercial benefits during technology transfer and licensing processes. Particularly in the context of the ESG trend, Attorney Chen highlighted that patent strategies must take into account environmental impact and long-term social value to ensure that technological innovations substantively contribute to a company’s sustainable development.
The forum covered a wide range of topics with in-depth discussions. Through multiple presentations and the sharing of practical case studies, participants gained a comprehensive understanding of the real-world applications of ESG in valuation and intellectual property assessment. It also offered forward-looking strategies and methodologies. The significance of this summit lies in its role as a valuable interdisciplinary platform for academia, industry, and policymakers to engage in dialogue. It delved deeply into how ESG evaluation serves as a critical driver for promoting sustainable development and enhancing innovative competitiveness in businesses. Looking ahead, events like this will continue to exert influence, advancing the practical implementation and widespread adoption of ESG principles. Moreover, they will help Taiwan showcase exemplary models of sustainable development on the international stage.
The International Association of Certified Valuation Specialists