The power of financial literacy: paving a clear path for the influence of board diversity on intellectual capital disclosure
Journal of Intellectual Capital
ISSN: 1469-1930
Article publication date: 10 October 2024
Issue publication date: 8 November 2024
Abstract
Purpose
Utilizing a multi-theoretical framework, this study aims to investigate the impact of board gender and nationality diversity on the extent of intellectual capital disclosure. Additionally, it seeks to explore the moderating role of financial literacy among audit committee members on the aforementioned relationship.
Design/methodology/approach
To empirically test the study’s framework, a panel dataset of listed firms on the Palestine Stock Exchange (PEX) spanning 12 years (2010–2022) was utilized. To address potential endogeneity issues and ensure robust findings, a battery of econometric estimators was employed, including ordinary least squares (OLS), one-step system generalized method of moments (GMM), lagged independent variables and a sub-index model.
Findings
The study findings make a significant contribution to existing intellectual capital literature. Specifically, the results reveal that the positive influence of board gender and nationality diversity on the extent of corporate intellectual capital disclosure is stronger when there is a high proportion of audit committee financial literacy. Additionally, the study distinguishes between overall index and sub-index analyses. Interestingly, the findings from the sub-index analysis, focusing on structural capital, relational capital and human capital, are somewhat similar to the results of the full index analysis.
Originality/value
To the best of the authors’ knowledge, this study represents the first empirical attempt to uncover the impact of financial literacy among audit committee members on the relationship between board diversity and intellectual capital disclosure.
Keywords
Acknowledgements
Mohammad A.A. Zaid expresses his sincere thanks to the Palestine Technical University-Kadoorie for supporting this research. Ayman Issa extends his sincere gratitude to Dongbei University of Finance and Economics for supporting this research. Ayman Wael Al-Khatib extends his sincere thanks to Middle East University in Amman, Jordan.
Citation
Zaid, M.A.A., Issa, A. and Wael Al-Khatib, A. (2024), "The power of financial literacy: paving a clear path for the influence of board diversity on intellectual capital disclosure", Journal of Intellectual Capital, Vol. 25 No. 5/6, pp. 1184-1209. https://doi.org/10.1108/JIC-05-2024-0147
Publisher
:Emerald Publishing Limited
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