Do Ownership Structures Affect Intellectual Capital? Empirical Evidence from European Companies

Purpose: This paper aims at investigating whether different ownership types (i.e. block holders, family, state and institutional shareholders) affect the measures of intellectual capital (IC). Design/methodology/approach: Using a balanced panel data of 2,598 European industrial Firm-year observations in the span period from 2006 to 2015 I explore the influence of ownership types on three proxies of IC: VAIC, intangible assets and R&D expenses. Findings: Consistently with predictions from agency and resource-based theories I find that family and state ownerships are negatively associated with the level of IC, while large institutional investors’ long-term perspective positively affects the firm’s IC performance. On the contrary, block holders are not significantly associated with none of the IC measures. Research contributions/limitations/implications: Theoretically this study contributes to both the corporate governance and IC literature, highlighting some important interrelations between the development and advancement of IC value and ownership types. The main limitation consists in the exclusive use of accounting-based measure to proxy for IC, however, the results may be of interest to managers in order to maximise the development of IC even in context where the shareholders constrain investments in e.g. intangibles and R&D expenses. In broad terms, the findings may interest investors in order to better allocate their resources.