Purpose—In adopting the resource-based view, this article analyzes the relationship between intellectual capital (IC) efficiency and profitability, in an effort to answer two key research questions, namely, if and how a firm’s IC efficiency directly affects current and future financial performance. Is IC a source of competitive advantage, and which of its components is most strategic? Design/methodology/approach—The analysis includes 218 publicly listed Italian companies and their annual reports from 2008 to 2010. In line with previous studies, the authors measure IC capital using an existing model, which relies on a value-added intellectual coefficient (VAIC) and thus can quantify IC with data from firms’ annual reports. Findings—The results strongly confirm the existence of a positive relationship between the value-added capital coefficient and firm performance, with measures of returns on equity and assets, using both the same and consecutive years’ data. The economic performance of Italian listed companies is strictly linked to the presence of intangible and invisible resources, which contribute to create wealth; these findings also reveal some weaknesses of the VAIC. Originality/value—This article offers the first inquiry into the relationship between IC and profit for Italian listed companies, using the VAIC. Italy provides a potentially interesting environment for investigating this issue, because Italian products are widely and globally appreciated for their intangible features (e.g., design, brands, taste).
Does Intellectual Capital Efficiency Affect Financial Performance? The Case of Italian Listed Firms
GUERRINI, ANDREA;ROMANO, GIULIA;
2014-01-01
Abstract
Purpose—In adopting the resource-based view, this article analyzes the relationship between intellectual capital (IC) efficiency and profitability, in an effort to answer two key research questions, namely, if and how a firm’s IC efficiency directly affects current and future financial performance. Is IC a source of competitive advantage, and which of its components is most strategic? Design/methodology/approach—The analysis includes 218 publicly listed Italian companies and their annual reports from 2008 to 2010. In line with previous studies, the authors measure IC capital using an existing model, which relies on a value-added intellectual coefficient (VAIC) and thus can quantify IC with data from firms’ annual reports. Findings—The results strongly confirm the existence of a positive relationship between the value-added capital coefficient and firm performance, with measures of returns on equity and assets, using both the same and consecutive years’ data. The economic performance of Italian listed companies is strictly linked to the presence of intangible and invisible resources, which contribute to create wealth; these findings also reveal some weaknesses of the VAIC. Originality/value—This article offers the first inquiry into the relationship between IC and profit for Italian listed companies, using the VAIC. Italy provides a potentially interesting environment for investigating this issue, because Italian products are widely and globally appreciated for their intangible features (e.g., design, brands, taste).I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.
