Out-Law News 1 min. read

Software compliance reaches board level, says FAST


The need for proper licensing for software has become a matter for board level executives, not just IT managers, said 77% of companies responding to an annual UK survey by the Federation Against Software Theft – up significantly from 56% last year.

Despite this, FAST CEO Geoff Webster said that "large corporates are still not getting the message that it is a legal requirement to provide proof of ownership licences."

FAST's annual survey on software piracy also revealed that companies still see piracy as not only on the increase but that nearly half of it is undertaken intentionally.

The survey, conducted throughout 250 companies in the UK, also highlighted a dramatic reduction in disciplinary action taken against employees who have breached internal software monitoring policies.

The main findings show:

Over 45% of respondents believe that the majority of software piracy in the UK is intentional and 47% believe it is still on the increase.

88% of companies interviewed claim to have centralised purchasing policies for software yet when asked whether other parts of the organisation have purchasing rights 43% said yes.

The increasing role of purchasing over the internet has not simplified the purchasing process with over 80% of respondents claiming it has not made the issue any easier.

Over 20% of respondents have enforced disciplinary procedures for breaches of software policy, a decline from 2002 from 32%.

Resulting dismissals have also declined dramatically from 36% in 2002 to 18% in 2003.

Over 54% stated that if required they would find it hard or very hard to provide proof of ownership licences.

Geoff Webster added:

"Policies can only be effective if backed up by disciplinary procedures and action, so it is disappointing to see that Board level attention is not supported within the organisation. This continues to leave the Board exposed to litigation, perhaps unwittingly, since the policies would be seen as ineffective without disciplinary procedures being followed."

He continued:

"This gap between the Board and their management is a real issue. If organisations are building new systems on the back of illegal software, they really are putting their business operations at a massive risk, and leaving their Directors exposed to the risk of prosecution. It would appear we still have a huge educational exercise to carry out in the marketplace, particularly in ensuring that there is no gap between Board expectations and operational execution."

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