Various Types of Intangible Assets

In today’s economy, companies are increasingly shifting away from bricks-and-mortar operating models to technology-driven models. As a result, more of a company’s valuation is underpinned by factors such as its brand, customer base, depth of talent, and other non-financial factors. These trends have resulted in the investment community to factor a broader range of non-financial information into their decisions, including environmental, social, and governance (ESG) matters. In response, companies also are increasing their focus on sustainability issues. In light of investor focus on sustainability, it is not surprising that companies are increasing the amount of information reported to the market about their sustainability efforts. However, rather than adding a line item in the income statement or balance sheet, companies instead provide more useful information about the future cash flow consequences of sustainability strategies, which are intangible and usually “non-financial” in nature