Above Board or Underhand? When Academic Entrepreneurs Break the Rules

WALDMAN, David | VAULONT, Manuel | BALVEN, Rachel | SIEGEL, Donald | RUPP, Deborah

Academic entrepreneurs who feel unfairly treated by their universities may be willing to sidestep university policy and even break the law to bring their innovative ideas to fruition, warn HKUST’s Assistant Professor Manuel Vaulont and his colleagues. In a study with critical implications for universities, organizations, and society at large, the authors show that academics’ perceptions of organizational justice—how fairly they are treated by their institutions—may determine whether they work with their universities to commercialize their research or form illicit agreements outside official channels.

Consider a world without insulin, penicillin, smartphones, or the Internet. These are just some  of the innovations developed by university scientists, engineers, and other researchers that have transformed (and extended) our lives. “Through a process known as technology transfer,” the authors tell us, “universities work with academic entrepreneurs to transform innovations into products and services that benefit society.” This may involve activities such as patenting and external collaboration. “For example,” the researchers add, “the Pfizer/BioNTech and Oxford/AstraZeneca vaccines were based on university research from the University of Mainz and Oxford University, respectively.”

Academic entrepreneurs are required by university policy—and by law—to disclose their innovative ideas to their institutions. However, some bypass formal channels and instead establish “backdoor” agreements with external parties to commercialize their research. The consequences are far-reaching. “Academic entrepreneurs who engage in informal, illicit technology transfer may detract from potential societal benefits,” the researchers tell us, “since their innovations may be less likely to come to fruition without university backing.”

Why do some academic entrepreneurs follow the rules while others break them? The answer, say the researchers, may lie in the extent to which they believe that their universities treat them fairly. Academics who can rely on their institutions to commercialize their ideas “in a mutually beneficial and non-exploitative way” have little reason to form illicit agreements with private firms, the authors propose. In contrast, those who feel undervalued or exploited by their universities may take their innovative ideas elsewhere.

To test these hypotheses, the researchers surveyed academic entrepreneurs from major research universities in the U.S. As expected, they found that “low justice perceptions may be an obstacle to formal technology transfer and promote informal technology transfer.” At the same time, the authors found that not every academic entrepreneur may respond to justice in the same way. In fact, some academics were more sensitive to injustice than others. Being treated fairly was particularly important to academics who strongly identified as entrepreneurs. However, those with a strong prosocial motivation, or concern for others’ welfare, were less swayed by perceived justice when considering whether to cooperate with or bypass their universities.

These findings point to a novel form of organizational deviance, say the authors. “The technology transfer process is rife with opportunities for academic entrepreneurs to evaluate their treatment,” say the authors. Therefore, university officials should ensure that entrepreneurs “perceive the university as an ally in commercializing their work.” They should regularly assess academics’ perceptions of justice through dialogue and surveys and carefully consider their individual differences, especially their entrepreneurial identity and prosocial motivation. After all, the authors tell us, “such factors may determine the success of technology transfer efforts for universities, organizations, and society as a whole.”


Assistant Professor