Will New Zealand’s promised IP reform deliver?

CIE’s Academic Director, Professsor Rod McNaughton

Opinion: New Zealand must prepare for the long game if it is serious about fostering a world-class innovation ecosystem.

New Zealand is set to overhaul its science and innovation system with its most significant reforms in 30 years. The Government’s Science System Advisory Group (SSAG) report released yesterday outlines major changes to Crown Research Institutes (CRIs), research funding, and intellectual property (IP) management.

One of the biggest shifts is a researcher-owned IP model inspired by the University of Waterloo, Ontario, Canada. If implemented, researchers, not institutions, will own their intellectual property, breaking from New Zealand’s bureaucratic technology transfer system. According to outgoing Science, Innovation, and Technology Minister Judith Collins, this change is intended to attract top talent and incentivise commercialisation:

“The Government wants to reward and incentivise people in the industry and will therefore develop a national policy for managing Intellectual Property (IP) for science, innovation, and technology-funded research.”

The assumption is that inventor ownership will drive entrepreneurship and create more research-based startups. However, while Waterloo’s model has been successful, policy alone won’t be enough. Waterloo’s innovation ecosystem has been built over decades of investment and industry collaboration.

SSAG report’s verdict on IP

The SSAG report criticises New Zealand’s Technology Transfer Organisations (TTOs), calling them a barrier to commercialisation. It argues that these offices slow research commercialisation, impose bureaucratic hurdles, and prioritise institutional control over national economic impact. Many universities retain large equity stakes in startups, discouraging private investment. Entrepreneurship training and commercialisation support remain inconsistent across institutions.

However, this assessment ignores successful initiatives such as the University of Auckland’s investment model. UniServices and the Centre for Innovation and Entrepreneurship have played a major role in supporting researchers and startups. According to the 2023 SCOPR survey, UniServices leads Australia and New Zealand in commercialisation, with 47 active spinouts and startups between 2021 and 2023.

Despite this, the Government plans to standardise IP policies across all institutions, following Waterloo’s model. While this could simplify commercialisation and remove barriers, a one-size-fits-all approach ignores the diversity of research institutions and existing successes.

What makes Waterloo different?

Having worked at the University of Waterloo, I’ve seen firsthand what it takes to build a world-class entrepreneurial ecosystem. During my time there, I helped establish the Conrad School of Entrepreneurship and Business, which plays a pivotal role in embedding entrepreneurship in the university’s innovation landscape.

Waterloo’s success is not just about IP policy. Its intellectual property rights policy, in place since 1957, allows researchers to own their discoveries while the university retains a non-exclusive, royalty-free license for internal use. This has helped create a thriving tech cluster, producing hundreds of successful startups.

However, what truly sets Waterloo apart is its broader innovation ecosystem. It has deep industry partnerships, ensuring research aligns with market needs. It also fosters an investment-friendly environment, attracting venture capital, corporate R&D, and government-backed innovation funding.

Waterloo is home to Canada’s largest cooperative education program, where students gain real-world industry experience before graduating. This creates a natural pipeline between academic research and industry, helping students launch startups with business connections and commercialisation experience.

New Zealand lacks a comparable system. To foster research-driven entrepreneurship, it must expand cooperative education programmes and create new funding streams for entrepreneurship education and startup support.

Why it will take time to work in New Zealand

Policy change alone won’t create a thriving innovation ecosystem. Success requires a long-term strategy that reshapes how universities, research institutions, and businesses interact. Neither the SSAG report nor the minister’s announcement addresses this in detail.

Attracting entrepreneurial researchers is essential, but policy changes alone won’t immediately transform mindsets among academics focused on publishing over commercialisation. To drive real change, universities must foster a culture that values entrepreneurship, actively recruit researchers with an entrepreneurial outlook, and revamp promotion criteria to reward commercialisation efforts alongside traditional research achievements.

University funding models must evolve. Institutions need university-affiliated venture funds, more industry-backed grants, and expanded cooperative education. Doctoral education must also innovate, embedding entrepreneurial competencies into curricula. More flexible faculty roles are needed that allow researchers to split time between academia and startups.

Even with these changes, success depends on the investment ecosystem. New Zealand lacks venture capital density and corporate R&D partnerships like Waterloo. Startups struggle to scale without capital and large companies that can support R&D and provide acquisition opportunities for successful exits.

The Government’s Invest New Zealand initiative could help but it must be strategically designed to support research commercialisation.

A long-term play, not a quick fix

Moving to a researcher-owned IP model is a long-overdue reform, but most institutions and their ecosystems are not yet equipped to handle it. Policy change alone won’t deliver results overnight. The Government must commit to patience and sustained investment.

Waterloo’s success took decades and it remains an outlier in Canada and globally.

New Zealand must prepare for the long game if it is serious about fostering a world-class innovation ecosystem.

IP reform is a step in the right direction but, without more nuance between institutional contexts and sustained effort in creating the right conditions for success, it risks becoming just another policy change that fails to deliver on its promise.