In Europe today, the real economy is no longer built on factories and ports alone. It’s built on ideas, algorithms, brands, data, relationships, and culture – all the things that don’t fit neatly on a balance sheet, but quietly decide who wins.
Welcome to The Intangible Navigator. This edition is our map of Europe’s intangible assets: where we really stand, why it matters, and how leaders should respond.
1. Europe’s Quiet Engine: Intangibles as the New Productivity Driver
Over the past decade, European policymakers have started to say out loud what strategists have known for years: intangibles are now the core engine of productivity and competitiveness.
A 2025 working paper for the European Commission on EU competitiveness concludes that investment in intangible assets – such as R&D, software, data, design, and organisational capital – is a key driver of labour productivity growth across EU sectors, often more important than traditional tangible capital. (EU competitiveness: The critical role of intangible assets in EU labour productivity growth)
At the same time, the European Investment Bank (EIB) shows that:
European firms that invest consistently in intangibles are more innovative, more likely to introduce new products, and more resilient to shocks.
Yet, intangible investment remains concentrated in a minority of firms, with a long tail of companies still under-investing in R&D, training, software, and IP. (EIB Investment Report 2023/2024)
The message is clear:
In Europe, the firms that master intangible assets don’t just grow faster. They create a different category of competitive advantage.
But there is a structural problem: Europe still struggles to see, measure, finance, and govern these assets with the same discipline it applies to machines and buildings.
2. The European Paradox: Intangible-Intensive, Tangible-Minded
On paper, Europe knows that the future is intangible. In practice, many systems are still designed for the old world.
2.1 Accounting that under-represents reality
Under IFRS (IAS 38), most internally generated intangibles – brand, internally developed software, data assets, internally grown IP, training, organisational capital – are expensed, not capitalised. The European Financial Reporting Advisory Group (EFRAG) has openly acknowledged that current financial statements fail to reflect the true importance of intangible value creation.
EFRAG’s discussion paper “Better Information on Intangibles – Which is the Best Way to Go?” argues for richer narrative and quantitative disclosures, even if recognition rules stay conservative. It suggests companies should provide more granular information on key intangibles, their strategy, and how they generate future cash flows.
Translation: the assets that matter most are barely visible in the primary financial statements.
2.2 Finance that still loves collateral
The OECD has repeatedly highlighted a financing gap for intangible-rich firms, especially SMEs. Intangible assets are harder to collateralise, more uncertain to value, and more relationship-dependent, which leads banks to favour tangible-heavy borrowers. (OECD: Mind the financing gap: Enhancing the contribution of intangible assets to productivity)
An OECD–EPO analysis on “IP-lifying SMEs” notes that IP-backed finance – using patents, trademarks and copyrights as collateral – is still underdeveloped in Europe, even though it has significant potential to unlock funding for innovative firms.
So Europe ends up with:
Firms that produce intangibles,
Systems that treat them as expenses, and
Financial markets that do not fully recognise them as assets.
That’s the European paradox.
3. A New Wave: CSRD, Double Materiality and the Intangible Turn
Where Europe does move fast is regulatory architecture – and intangibles are entering that arena.
3.1 CSRD and the age of “double materiality”
The Corporate Sustainability Reporting Directive (CSRD) radically expands the scope and depth of non-financial reporting in the EU. From large listed firms to many non-EU groups with significant EU operations, thousands of companies will now have to report according to the European Sustainability Reporting Standards (ESRS).
At the heart of CSRD is double materiality:
Financial materiality – how ESG issues affect the company’s value.
Impact materiality – how the company affects society and the environment.
CSRD doesn’t talk about “intangible assets” in the narrow IFRS sense, but in practice, it forces companies to disclose:
Human capital – skills, training, employee well-being, retention.
Relational capital – value chains, customer dependency, supplier resilience.
Intellectual capital & innovation – R&D, business models, digitalisation, data governance.
In other words, CSRD is a regulatory Trojan horse for intangibles. It pushes boards to explain not just what they own, but how they create value.
3.2 EFRAG’s push for better intangibles information
Parallel to CSRD, EFRAG has promoted academic work and consultation papers asking: “Do companies disclose relevant information about intangibles?” The answer is: inconsistently, and often poorly structured. (Insights from business model reporting and risk reporting)
The direction of travel is clear:
More demands to link intangibles with performance,
More pressure on management to justify strategy, not just results,
Growing expectations from investors for decision-useful metrics on innovation, IP, human capital, and data.
For European leaders, this is not an accounting footnote. It’s a strategic invitation.
4. Intangibles and Competitiveness: What Draghi is Really Warning About
The Draghi report on the future of European competitiveness goes beyond GDP statistics. It warns that Europe’s current model is too slow, too fragmented, and under-scaled in strategic sectors – including digital, deeptech, and advanced manufacturing.
Reading it through the lens of intangibles, three messages stand out:
Productivity gap: Europe lags the US in productivity growth, and one key driver is lower and less efficient investment in intangibles and innovation. (EU competitiveness: The critical role of intangible assets in EU labour productivity growth)
Scale gap: Europe struggles to scale intangible-rich firms (deeptech, AI, quantum, biotech) to global champions; many exit early or move abroad. (The future of European competitiveness)
Capital gap: Even as public programs expand, private risk capital for high-intangible ventures remains weaker than in the US, and underwriting of IP/data-rich business models is still immature. (INNOVATION INTEGRATION SIMPLIFICATION IN EUROPE)
Draghi’s policy proposals and the EIB’s new Tech EU initiative (targeting €70 billion for tech investments and leveraging up to €250 billion in private capital from 2025–2027) are, in reality, a massive bet on intangibles: AI, advanced software, deeptech, robotics, cybersecurity, health, and dual-use technologies. (EIB to allot 70 bln euros for tech sector in 2025-2027-officials)
Europe is finally aligning industrial policy, capital, and regulation around the intangible economy. The question is: will companies and investors seize this moment, or treat it as another compliance exercise?
5. The Intangible Navigator’s Lens: Four Strategic Layers
To make this actionable, let’s break Europe’s intangible challenge into four layers that every serious leader in the region should master.
5.1 Visibility: Seeing What You Really Own
Most European firms – even sophisticated ones – do not have a consolidated view of their intangibles, because most of them do not have a Chief Intangible Assets Officer! See, for example, my dedicated articles here, here and here)
A strategic intangible map should include:
Intellectual Property – patents, trade secrets, trademarks, designs, copyrights, know-how.
Data Assets – proprietary datasets, models, pipelines, standards, and data rights.
Human Capital – critical skills, communities of practice, leadership capabilities, tacit knowledge.
Relational Capital – key partners, ecosystems, platforms, distribution channels, alliances.
Organisational Capital – processes, culture, governance models, software systems, algorithms.
Without this map, CSRD reporting becomes storytelling, not strategy. With it, you can start asking:
Which intangibles are truly strategic? Which are fragile? Which are under-protected, under-funded, or under-monetised?
5.2 Protection: Turning Ideas into Defensible Assets
Europe’s strength in research and innovation is not automatically a strength in appropriation.
In practice, this means:
Moving from ad-hoc IP filing to IP Design – aligning patents, trade secrets, brands, and contracts with the business model and long-term positioning.
Using IP and data governance to create control points in value chains (interfaces, standards, protocols, platforms).
Exploring IP-backed financing, especially for SMEs and scale-ups, as OECD and EPO recommend.
Europe doesn’t need more patents for the sake of numbers. It needs fewer, better-engineered intangible fortresses.
5.3 Monetisation: From Assets to Cash Flows and Influence
Intangibles are not trophies. They are engines of revenue and leverage.
In a European context, monetisation strategies can include:
Licensing and franchising – classic routes but often underused in industrial deeptech.
Platform and ecosystem models – where IP and data are used to attract partners and create standards.
Co-development and JV structures – pooling intangibles to share risk and accelerate adoption.
IP-based project finance – especially relevant where patents, software, or algorithms are embedded in long-lived infrastructure (energy, mobility, defence, health).
The OECD’s work on intangibles and productivity shows that when financing and intangibles are aligned, productivity gains are significantly larger in intangible-intensive sectors.
The question for European leaders is no longer “Do we have intangibles?” It’s “Do we have a clear playbook for turning them into recurring cash flows and negotiation power?”
5.4 Governance: Anchoring Intangibles in the Boardroom
With CSRD, EFRAG guidance, and growing investor pressure, intangibles are moving into the board agenda – whether companies are ready or not.
Good intangible governance in Europe should include:
A board-level view of intangible risks and opportunities (IP litigation, key-person risk, data ethics, dependency on platforms, etc.).
KPIs that link intangibles to strategy – innovation velocity, IP quality, data asset performance, human capital metrics.
Integration with risk management and sustainability – because human capital, data governance, and innovation ethics are now directly tied to licence to operate.
This is where The Intangible Navigator mindset is essential:
Intangibles are no longer a “nice narrative” for the annual report. They are a governance domain that touches competitiveness, resilience, and reputation at once.
6. A European Playbook: From Compliance to Advantage
Let’s translate all this into practical moves for European executives, investors, and policymakers.
For European Companies
Build an Intangible Balance Sheet (even if accounting doesn’t). Internally map and value your IP, data, human, relational, and organisational capital. Use this as a management tool, not just a disclosure checklist.
Align CSRD with Strategy. Treat CSRD and ESRS not as a reporting burden, but as a structured narrative of your intangible engine. Make sure what you disclose publicly reflects an internal strategy, not the other way around.
Professionalise Intangible Asset Management with HMS DELSOL. Create dedicated roles or mandates (CIPO, Chief Intangible Assets Officer, or equivalent) with strategic, not only legal, responsibilities.
Explore IP/Data-backed Financing. Especially if you’re a scale-up: talk to specialised lenders, funds, and the EIB ecosystem about using IP and data as collateral. The tools are emerging; the early movers will shape standards.
For Investors
Underwrite Intangibles Explicitly. Add systematic intangible due diligence: IP landscape, data moat, organisational capital, talent model.
Push for Intangible Governance. Ask portfolio companies how they connect IP, data, people, and partnerships to long-term strategy – not just to this year’s valuation.
Use Intangibles to De-Risk, Not Only to “Upside.” A well-constructed intangible portfolio can reduce dependency on single products, customers, or markets. Think about my Due Diligence method (see dedicated articles here, here and here)
For Policymakers & Institutions
Make Intangible Strategies a Condition of Public Funding. Horizon Europe, IPCEIs, and national aid should not only fund R&D – they should reward robust intangible strategies, including IP and data governance.
Scale IP-backed Finance Pilots. Work with EIB, EIF, and national banks to make IP-backed lending and guarantees a mainstream tool for innovation finance.
Integrate Intangibles into Competitiveness Metrics. Follow the direction of the new EU competitiveness work and include intangible investment, intangible quality, and IP position in the core scoreboard for Europe’s economic health.
7. Conclusion – Europe Between Memory and Imagination
Europe is a continent rich in memory – institutions, universities, culture, legal traditions – and increasingly rich in imagination – deeptech, quantum, AI, life sciences, design.
Intangible assets are where memory and imagination meet: in code, in patents, in data, in brands, in organisational models that survive founders.
The risk for Europe is not that it lacks ideas, capital, or regulation. The risk is that it treats intangibles as a narrative, while others treat them as a balance sheet and a weapon of mass+construction.
The opportunity is extraordinary: with CSRD, the Quantum and AI strategies, the EIB’s Tech EU initiative, and a growing recognition of intangibles in EU competitiveness policy, Europe has all the ingredients to become the most sophisticated intangible economy in the world – not just in thought, but in ownership.
The real question for every European leader now is:
Are you treating your intangibles as a story you tell, or as a system you deliberately design, protect, and monetise?
Because in the next decade, in Europe as elsewhere, those who navigate intangibles with intention will navigate the future.
