Intellectual capital and the capital market: a review and synthesis
Journal of Human Resource Costing & Accounting
ISSN: 1401-338X
Article publication date: 7 September 2010
Abstract
Purpose
The purpose of this paper is to review and synthesise current knowledge on the importance of intellectual capital (IC) information to the capital market.
Design/methodology/approach
The paper is by way of literature review. It reviews the empirical research literature from different methodological strands and synthesises the findings to provide evidence on the impact/importance/usefulness of IC from a capital markets perspective.
Findings
Importance of IC information has been examined using various research methods including capital markets research, questionnaire surveys, face‐to‐face interviews, experimentations, verbal protocol analysis and content analysis of analyst reports. These studies provide evidence on the usefulness/importance of many types of IC information. Also, evidence from IC disclosure studies on initial public offering prospectuses sheds light on perceived importance of types of IC information to the capital market. However, there is a scope for more research to refine the current understanding of the importance of IC to the capital market.
Practical implications
By reviewing and synthesising the literature, this paper provides an important source of reference for future researchers and policy makers who wish to formulate guidelines for IC reporting to better meet the information needs of capital market actors. It also highlights future research directions.
Originality/value
This is the first‐published literature review on the importance of IC that provides a comprehensive review of studies adopting various research methods. Prior reviews have been limited to value‐relevance and/or predictive ability studies.
Keywords
Citation
Abhayawansa, S. and Guthrie, J. (2010), "Intellectual capital and the capital market: a review and synthesis", Journal of Human Resource Costing & Accounting, Vol. 14 No. 3, pp. 196-226. https://doi.org/10.1108/14013381011095472
Publisher
:Emerald Group Publishing Limited
Copyright © 2010, Emerald Group Publishing Limited