Empirical Examination of Integrated Component of Intellectual Capital on Financial Performance: Study of Select Service and Non-Service Firms in Nigeria
Okoye, E.I. Aroh, N.N & Egbunike, A.P. (2015): Empirical Examination of Integrated Component of Intellectual Capital on Financial Performance: Study of Select Service and Non-Service Firms in Nigeria Available at SSRN: https://ssrn.com/abstract=3097869
17 Pages Posted: 11 Jan 2018
Date Written: September 1, 2015
Abstract
This study assessed the impact of the components of Intellectual Capital (Human Capital, Structural Capital, Relational Capital and Innovation Capital) of Companies listed on the Nigerian Stock Exchange with a view to determining their association with financial performance. The study adopted multiple regression analysis in analyzing data collected from annual reports and accounts of the sampled companies to determine the continue effect of intellectual capital on financial performance among the 182 listed companies. Based on this, the study found out that the integrated effect of the components (Human capital, structural capital, relational capital and innovation capital) made about 40% contribution to the variance in financial performance of the companies. The study developed a model for understanding the IC components and their effect on organization financial performance. The application of this is that investment in IC can contribute to over 40% of change in financial performance consequent upon this, it is recommended that Nigerian listed companies should substantially invest in IC to help boost companies’ financial configuration.
Keywords: Integrated Components, Intellectual Capital, Financial Performance, Firms, Nigeria
JEL Classification: M40
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