01 Aug 2024

Espionage Alert: How to Crack the CI Code Without Breaking Ethical & Legal Boundaries

When most people hear the word, “espionage,” they likely picture a spy from the big screen—James Bond for action junkies or perhaps Austin Powers for comedy lovers. But espionage isn’t confined to Hollywood thrillers. And it isn’t a recent phenomenon either.

A Foreign Policy article highlights the storied history of corporate espionage, noting, “From classical Greek cities to modern U.S. corporations, the theft of trade secrets has marked a transfer of power almost as routinely as bloodshed. The methods have switched from old-fashioned spying to online hacks, but the motivation remains the same: winning.”

From an 18th-century Jesuit missionary sharing the secrets of making Chinese porcelain to the more sophisticated cyber thefts we see today; corporate espionage remains a major concern. So much so, in fact, that new regulations are being enacted to help ensure trade secrets stay secret. Just last year, the UK National Security Act 2023 came into effect, making “… the unauthorized conduct of obtaining, copying, recording, or retaining a trade secret, or disclosing or providing access to a trade secret, under certain circumstances, a criminal offence.”

While gathering competitive intelligence may seem different from industrial espionage by a foreign government, it raises the question: when does corporate intelligence cross the line into unethical practices?

With powerful search technologies and ethically sourced data, LexisNexis solutions help you uncover competitive intelligence with integrity. Here's what to consider.

Keeping competitive intelligence research ethical

Authentic competitive intelligence (CI) delivers essential insights to decision makers across an enterprise, helping organizations anticipate competitive threats, fuel innovation, and inform long-range plans. And conducting CI research is significantly easier in the digital age since company and executive data is available through cloud-based tools. However, it isn’t without risk.

To address the potential for misuse and abuse of proprietary company information, the (SCIP) has established a strict code of ethics to follow that lists legal and ethical ways to gather competitive intelligence, including:

To continually strive to increase the recognition and respect of the profession
To comply with all applicable laws, domestic and international
To accurately disclose all relevant information, including one’s identity and organization, prior to all interviews
To avoid conflicts of interest in fulfilling one’s duties
To provide honest and realistic recommendations and conclusions in the execution of one’s duties
To promote this code of ethics within one’s company, with third-party contractors and within the entire profession
To faithfully adhere to and abide by one’s company policies, objectives and guidelines

Ethical competitive intelligence research gathers relevant data—from legally obtained sources—about individual competitors, as well as the competitive landscape within a particular industry or market segment.

What is the difference between competitive intelligence and corporate espionage?

Now, let’s look at the negative side—corporate espionage. The digital age, unfortunately, makes corporate espionage significantly easier. For example, a disgruntled employee can load thousands of sensitive documents on an easy-to-hide thumb drive. Or cyber-attacks can infiltrate corporate servers and steal huge volumes of data in an instant. Other examples of espionage, illegal or unethical competitive intelligence include:

Accessing a competitor’s property or files without permission
Posing as a competitor’s employee to access proprietary information and trade secrets
Wiretapping or hacking a competitor
Attacking a competitor’s website with malware

The Australian Strategic Policy Institute notes, “In the US alone, the annual cost of IP theft has been estimated at up to $600 billion.” IP theft poses significant risks, including loss of competitive advantage, damage to your organization’s reputation, and financial repercussions. In addition to protecting your own proprietary data from espionage, you need to ensure that your competitive intelligence gathering doesn’t cross ethical boundaries. By prioritizing use of information from legitimate sources, such as industry reports, market research, public filings, press releases, and reputable news publishers, you maintain high standards for your competitive intelligence.

Working within the rules for ethical competitive intelligence

Competitive intelligence, when done right, can give your organization an edge—legally. What should your CI strategy include? Naturally, you should look internally to start your research. Team up with sales to procure interviews with new customers and lost prospects, then conduct win/loss analysis to understand the factors that led to a closing or losing a deal, pinpointing:

Competitors’ key selling points for products or services
Misunderstandings about your products or services that need to be clarified moving forward
Advantages and disadvantages related to marketing messages or competitors' processes

And don’t forget to follow up with other experts across your organization. You can pick their brains for insights into market trends or competitors’ habits. Afterwards, ask them to keep you in the loop if they come across any other interesting resources.

How Nexis^® and Nexis^® Data+ enable ethical competitive intelligence research

You can tap industry experts outside your company, but if time is tight (and it always is), you can skip the interviews and focus on the content they produce. But instead of painstaking open web research, consider a solution like Nexis^®.

With a credible database spanning print, broadcast and web news, thought-leader and industry blogs, company financial information, legal and patents data and more, Nexis puts comprehensive competitive intelligence research at your fingertips. Powerful pre- and post-search filters make it easy to cut through the clutter to refined results sets that let you uncover insights more efficiently. And because LexisNexis^® works with publishers to manage copyright compliance, you can use the information you uncover with 007-level confidence while knowing that your competitive intelligence has been gathered ethically and legally.

Likewise, Nexis Data+ enables you to ingest ethically sourced data directly into your applications and competitive analysis tools through a flexible API, enabling you to take advantage of big data without crossing ethical lines in your acquisition of it.

Next Steps: