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Intellectual capital and traditional measures of corporate performance

Steven Firer (Faculty of Business and Economics, Monash University‐South Africa, Ruimsig, South Africa)
S. Mitchell Williams (School of Accountancy, Singapore Management University, Singapore)

Journal of Intellectual Capital

ISSN: 1469-1930

Article publication date: 1 September 2003

10650

Abstract

The principal purpose of this study is to investigate the association between the efficiency of value added (VA) by the major components of a firm's resource base (physical capital, human capital and structural capital) and three traditional dimensions of corporate performance: profitability, productivity, and market valuation. Data are drawn from a sample of 75 publicly traded firms from South Africa from business sectors heavily reliant on intellectual capital. Empirical analysis is conducted using correlation and linear multiple regression analysis. Findings from the empirical analysis indicate that associations between the efficiency of VA by a firm's major resource bases and profitability, productivity and market valuation are generally limited and mixed. Overall, the empirical findings suggest that physical capital remains the most significant underlying resource of corporate performance in South Africa despite efforts to increase the nation's intellectual capital base.

Keywords

Citation

Firer, S. and Mitchell Williams, S. (2003), "Intellectual capital and traditional measures of corporate performance", Journal of Intellectual Capital, Vol. 4 No. 3, pp. 348-360. https://doi.org/10.1108/14691930310487806

Publisher

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MCB UP Ltd

Copyright © 2003, MCB UP Limited

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