Why Intangible Assets Now Drive Corporate Value and Risk

50 years ago, the average company’s value was largely comprised of assets that you could physically see, touch, and depreciate (as opposed to amortize). You could tour the factory floor, count the trucks, kick the tires, and tally up your inventory. In 1975, tangible assets (buildings, equipment, inventory, real estate, etc.) made up roughly 83% of the market value of S&P 500 companies.

Fast forward to today, and most corporate value is now tied less to things you can touch and more to things you can’t. As of 2025, approximately 90% of the S&P 500’s market value resides in intangible assets. That’s a complete inversion of the numbers in 1975.

This isn’t just a US phenomenon. The value of intangible assets worldwide reached an all-time high of $97.6 trillion in 2025, having grown 23% from 2024, according to Brand Finance, which also points out that while corporate value may have shifted decisively from the tangible to the intangible, 83% of intangible asset value remains unaccounted for on balance sheets. And all too often, companies still design enterprise risk frameworks that cater only to their tangible assets.

What Counts as Intangible Assets?

Intangible assets are a broad category that includes:

• Brand
• Intellectual property (e.g., patents and trademarks)
• Data
• Contractual rights
• Institutional knowledge
• Workforce expertise, organizational culture
• Relationships
• Customer trust
• Proprietary systems

In short, the category encompasses all the ‘stuff’ that determines enterprise value that is embedded in goodwill, systems, data, relationships, and people.

Much of this is naturally hard to quantify in accounting terms. As Brand Finance points out, accounting standards generally recognize only acquired intangibles and certain registered intellectual property. Internally generated brand equity, cultural capital, and customer relationships typically remain off the books.

One problem is that many stakeholders (from potential investors to directors) rely heavily on financial reporting to understand risks and opportunities. From the perspective of a company’s board and management, when the majority of enterprise value sits outside formal reporting structures, risk oversight inherits a structural blind spot.

Adam K. Sacharoff, Chair of Much Shelist’s Intellectual Property practice, explains: “In today’s economy, your most valuable assets are the ones you can’t see. While many companies invest heavily in developing IP and brand recognition, far less is spent protecting and enforcing those assets. In an intangible economy, failing to secure, police, and properly structure ownership of these rights can result in their erosion — or even their loss.”

What Can Go Wrong Here?

There are several risks that can arise when governance frameworks fail to keep pace with the shift toward intangible assets.

Valuation Volatility

Intangible assets may not always appear on balance sheets, but they’re very much reflected in investor valuations.

Market capitalization is increasingly tied to perception and confidence, meaning that markets react swiftly to any changes in brand reputation, customer trust, or governance credibility.

Consider how the world’s largest companies also have the highest intangible valuations. NVIDIA, which tops the list, has intangible assets that make up 98% of its total valuation.

Top 7 companies with the highest intangible value

Source: Brand Finance GIFT 2025

In recent weeks, Magnificent Seven stocks (which refer to the seven largest tech companies by market cap — Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, and Tesla¹) have tumbled amid investor fears over the companies’ eye-watering AI spending. Broader economic and geopolitical uncertainties also haven’t helped, causing nervous investors to sell off riskier investments.

Amazon and Microsoft have both entered bear market territory, down more than 20% from their recent highs.

It’s too early to tell if we’re seeing signs of the AI bubble bursting, or if this is simply a temporary anomaly.

In any case, in an intangible economy, markets are particularly sensitive to signals about trust, transparency, and credibility. When those weaken, valuation can adjust far more quickly than traditional risk models assume.

Regulatory and Litigation Exposure

Damage to intangible assets rarely stops at reputation. It can snowball into regulatory scrutiny or litigation, which can in turn amplify the reputational damage.

When governance around data, intellectual property, or digital systems is informal or inadequate, the legal consequences can go well beyond fines or settlements. Weak data governance, for example, can trigger data breaches. For many businesses, this isn’t a rare phenomenon. A 2025 My Security Marketplace survey found that 43% of small and medium-sized businesses faced at least one cyberattack in the past year.

Data breaches can cost customer trust and monetary payments, and can trigger regulatory investigations under privacy laws, mandatory disclosure obligations, class action litigation, and even shareholder suits alleging inadequate oversight.

A company, therefore, needs to demonstrate that cyber governance is embedded in enterprise risk management and treated with intentionality.

Protection Gap

A 2024 Ponemon Institute report (sponsored by Aon) found that roughly 60% of tangible assets were insured, while only 19% of intangible assets were insured. At the same time, information assets were more likely to result in loss and carry higher probable maximum losses than tangible assets such as property, plant, and equipment.

This means that the assets most responsible for valuation are often the least protected by insurance. And unlike a damaged building, lost trust or weakened brand equity can’t be restored with an insurance payment.

So, How Do You Prepare for Intangible Risks?

Start by identifying what actually creates value in the company and where the risk exposures lie. This may mean mapping out the brand drivers, customer concentration, data systems, contractual dependencies, institutional knowledge, and cultural capital. If it drives enterprise value, it belongs on the risk register.

Next comes risk assessment. Which scenarios could damage customer trust or weaken brand equity? Where are you exposed to data privacy failures or IP leaks? Map out these scenario exercises.

Assign clear ownership and controls at the enterprise level for each intangible asset. Keep in mind that intangible risks are often interconnected and can live across multiple departments. When ownership is limited to individual departments, it leads to fragmented accountability.

From there, set up ongoing monitoring and reporting of the key indicators of intangible assets. This may include customer trends, cyber maturity scores,² regulatory developments, employee turnover in critical roles, or concentration risk in key customer relationships. In an intangible economy, they may offer you early warning signals.

Finally, align oversight with strategies for protecting your intangible assets. This may involve registering your IP, hardening your cybersecurity defenses, putting NDAs in place, investing in people development, or improving your brand reputation.

Intangible assets require tangible controls. You may not be able to walk through your intangible assets the way you once walked through a factory floor. But markets are walking through them every day.

If you’re interested in learning more, we encourage you to check out Financial Poise’s four-part .

End Notes

1. The term ‘Magnificent Seven’ was first coined by Michael Hartnett, chief investment strategist at Bank of America Corp, back in May 2023. You can read more about its origins here.
2. Cyber maturity scores assess how well an organization manages cybersecurity risk by evaluating its people, processes, and technology against structured best practices. The assessment measures whether cyber governance is informal and reactive or integrated and continuously improving within enterprise risk management. They’re also more holistic compared to cyber risk assessments, which focus on specific threats.