The Threat
Your next investment could make billions. For someone else.
UK technology companies are at risk of being compromised by certain states for their technological, economic, political, and military gain. These activities pose a terminal risk to those businesses, jeopardising your investment returns.
States will target companies of all sizes, deploying their cyber, human, and technical capabilities to steal ideas, information, and techniques, such as trade secrets, financial information and information on customers or suppliers. State-backed actors will also subvert legitimate business collaborations and transactions, or indirect routes via supply chain attacks, to achieve their state’s aims. These activities pose a terminal risk to your investment. It is therefore essential to know and trust who you are doing business with.
Embed security across your decision points to protect your capital. Your portfolio companies taking certain investments today may preclude them from major future investments, endangering your returns. Empower the companies you invest in to protect themselves from state threats through good security to improve the safety of your investments.
Good security practices are also good investment practices.
In 2004, China launched several tenders to make 200 high-speed trains. Each tender stipulated that foreign companies had to collaborate with a domestic partner and transfer key technologies to China; and the final products had to be marketed under a Chinese state-owned enterprise’s brand. Bombardier, Kawasaki, Siemens, and Alstrom each formed joint ventures (JVs) with one of two Chinese state-owned enterprises.
Within three years, Chinese firms allegedly started producing high-speed trains based on the foreign technology. The Chinese firms allegedly violated licensing agreements in which they committed to only use the technology domestically. Chinese firms are now selling their technologies back into foreign markets in competition with the companies from which they allegedly stole the technology.6
How NPSA can help
Your investments could be under threat from state actors, but NPSA, the UK’s newly launched National Protective Security Authority, is here to help you to secure your success. Read our Secure Innovation for Investors guidance to learn more about how you can protect your investments.