Intellectual capital and firm value: The role of firm performance

Main Article Content

Aftab Ahmed
Muhammad Kashif Khurshid
https://orcid.org/0000-0002-8500-2544
Zeeshan Riaz
Muhammad Zulfiqar
Muhammad Usman Yousaf

Abstract

Businesses worldwide are getting new opportunities and facing challenges due to increased market competition and the transformation of globalization dynamics. To become successful and to get a competitive edge, it has become imperative for companies to adopt modern business strategies. This study empirically examines the nexus between intellectual capital and firm value with the mediating role of firm performance. VAIC (value-added intellectual capital) has been taken as an independent variable along with its three components, i.e., VACA, VAHU, and STVA. ROA and ROE have been taken as a measure of firm performance. Firm value was measured through Tobin’s Q. The panel data was collected from non-financial firms listed on the Pakistan stock exchange for six years resulting in 474 observations. Fixed-effect regression test was conducted with the help of Eviews 9.0. The findings revealed that intellectual capital positively impacts the firm value. Moreover, firm performance mediates the nexus between intellectual capital and firm value. This study has contributed not only to literature related to intellectual capital, firm performance, and firm value but is also helpful for practitioners and managers as it provides insight into the specific components of intellectual capital, which generates firm value if invested and maintained efficiently and effectively.

Article Details

How to Cite
Aftab Ahmed, Muhammad Kashif Khurshid, Riaz, Z., Muhammad Zulfiqar, & Muhammad Usman Yousaf. (2023). Intellectual capital and firm value: The role of firm performance. Journal of Management Info, 9(3), 402–417. https://doi.org/10.31580/jmi.v9i3.2666
Section
Articles
Author Biographies

Aftab Ahmed, Department of Management Sciences, The Superior University, Lahore, Pakistan

The Superior University, Lahore, Pakistan 

Muhammad Kashif Khurshid, Department of Management Sciences, National University of Modern Languages, Islamabad, Pakistan 

National University of Modern Languages, Islamabad, Pakistan 

Zeeshan Riaz, Department of Management Sciences, The Superior University, Lahore, Pakistan

The Superior University, Lahore, Pakistan

Muhammad Zulfiqar, Department of Management Sciences, Khwaja Fareed University of Engineering & Information Technology, Rahim Yar Khan, Pakistan

Khwaja Fareed University of Engineering & Information Technology, Rahim Yar Khan, Pakistan 

Muhammad Usman Yousaf, Department of Management Sciences, G.C. University, Faisalabad, Pakistan 

G.C. University, Faisalabad, Pakistan 

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