To read this content please select one of the options below:

Trends and relationship among intellectual capital disclosures, patent statistics and firm performance in Indian manufacturing sector

Khushdeep Dharni (School of Business Studies, Punjab Agricultural University, Ludhiana, India)
Saddam Jameel (School of Business Studies, Punjab Agricultural University, Ludhiana, India)

Journal of Intellectual Capital

ISSN: 1469-1930

Article publication date: 29 April 2021

Issue publication date: 26 May 2022

697

Abstract

Purpose

This study highlights the trends of qualitative intellectual capital disclosures and patent statistics in the Indian manufacturing context by considering the numerous patent applications, patent grants, forward citations and backward citations. Furthermore, the study investigates the relation among qualitative disclosures, patent statistics and firm performance.

Design/methodology/approach

All manufacturing companies of CNX 500 Index of National Stock Exchange of India Limited are considered. Based on data availability, 243 manufacturing firms spanning across seven major manufacturing sectors are included. Secondary data were obtained from the annual report of companies and patent databases from 2004 to 2005 to 2013–2014, generating a sample of 2,430 firm years. Content analysis and citation analysis are used for collecting the relevant data.

Findings

Overall, the study results indicated increasing trends for all types of intellectual capital disclosures. Similar trends are observed for patent applications and patent grants, indicating a surge in patenting activities across the manufacturing sector. However, increasing trends in patenting activities are not reflected for forward and backward citations. In addition, significant differences in means and trend coefficients for qualitative disclosures and patent statistics indicated industry specificity within the Indian manufacturing sector. Furthermore, industry specificity is observed when translating intellectual capital to firm performance. The measure of firm performance, that is, Tobin's Q, is having a significant positive association with qualitative disclosures and patent statistics.

Research limitations/implications

As the study is based on secondary data, its accuracy is limited by the accuracy of the data sources such as the annual reports of companies and patent databases.

Practical implications

The study findings imply that policymakers should devise and execute sector-specific policy interventions. Moreover, managers and policymakers should emphasize the qualitative aspect of patenting activities.

Originality/value

The study is an original work that highlights the trends in qualitative disclosures in the Indian manufacturing context. The value relevance of intellectual capital and patent statistics has been established.

Keywords

Acknowledgements

The authors gratefully acknowledge the funding of this research by National Science and Technology Management Information System (NSTMIS), Department of Science and Technology, Government of India.

Citation

Dharni, K. and Jameel, S. (2022), "Trends and relationship among intellectual capital disclosures, patent statistics and firm performance in Indian manufacturing sector", Journal of Intellectual Capital, Vol. 23 No. 4, pp. 936-956. https://doi.org/10.1108/JIC-05-2020-0148

Publisher

:

Emerald Publishing Limited

Copyright © 2021, Emerald Publishing Limited

Related articles