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Taking into account the transformation in economic reality towards a knowledge economy it seems logical that we treat IC as a resource, equal to that land, physical assets, and financial capital. This means that it is not anymore treated as a cost but as an investment. In order for the new system to be consistent we have to define a new index, namely the value creation efficiency of intellectual capital. Its empirical applications shows that while revenue, profit and GDP may indicate successful performance, IC efficiency may indicate the opposite, that value is being destroyed and not created.

Intellectual capital (IC) is a paramount resource for competitiveness in the knowledge-based financial sectors of the economy. As financial technology advances, specifically in the banking industry, it is vital to understand the effect of IC on financial performance. This study aims to investigate the effect of IC on return on equity (ROE), with a unique emphasis on the moderating role of board attributes. Previous studies have overlooked this moderating role.

The study sample consists of 17 banks and a panel data set spanning 2016–2021, extracted from annual reports. Antel Pulic’s value-added intellectual coefficient (VAIC) model is used to compute IC. To analyze the data, a generalized least squares analysis is conducted. The robustness of the analysis is ensured by using the two-stage least squares (2SLS) econometric technique.

The findings indicate that both the VAIC and human capital efficiency (HCE) have a significant impact on the ROE of banks. In terms of moderation, it is observed that board size (BS) exerts a negative effect on the association between VAIC, HCE, structural capital efficiency and ROE. Additionally, BS positively compounds the connection between capital employed efficiency and ROE. Similarly, the presence of independent directors (IND) significantly moderates the effects of VAIC and its components on the ROE of banks in Pakistan.

Banks should focus on the HCE for a higher ROE. Moreover, banks ought to prioritize appointing more independent directors in the boardroom for effective utilization of IC and greater ROE.

The findings of the study, which analyzed data from Pakistan’s banking sector, are original and provide additional insights into the literature on IC and board attributes.

The purpose of this paper is to study, mainly from the point of view of methodological accounting principles, the value added intellectual coefficient (VAIC), introduced by Pulic as a measure of intellectual capital efficiency (ICE). More specifically, the aim of the analysis is to investigate the strengths and weaknesses of the VAIC, primarily from the accounting theory perspective.

The approach to the study of Pulic's contribution is as follows: first the authors submitted Pulic's methodology to a “conceptual” test, in order to check whether it contradicts any basic accounting principles. Then the results of this methodological test were compared to those obtained by the authors who have criticized Pulic's proposal, in order to check for any concordance or discordance with the literature.

Several authors have discussed the crucial aspects of the VAIC. In this paper the focus is primarily on Andriessen's concerns, since they relate to the theoretical accounting aspects of Pulic's proposal, which is the topic of the paper. First of all, the authors have found that the suggestion of Pulic, centered on the Value Added Income Statement, does not modify or contradict any of the fundamental accounting principles. Therefore the criticisms made by Professor Andriessen should be subject to future research. Furthermore the performance measure proposed by Pulic (VAIC) is not a genuine rival to the traditional methodologies (e.g. the Economic Value Added (EVA)), as instead emerges from Pulic's papers. VAIC and EVA measure different aspects of the performance and therefore may usefully live together in a context in which the performance is measured through multicriteria methodologies, such as the Balanced Scorecard, Skandia Navigator or Intangible Asset Monitor.

The practical implications of the results are: the correct placing of Pulic's contribution into the accounting principles theory; and the manner for using the VAIC methodology in a multicriteria performance evaluation. The authors believe that both aspects have relevant implications for business accounting practice.

The paper shows that almost all of the misunderstandings of the literature debate, regarding Pulic's proposal, arise from a “semantic shift” generated by the fact that Pulic uses the terms human capital and structural capital with a completely different meaning from that of the Skandia Navigator. Authors’ hope is that the study described in the paper will contribute to a better understanding of: the way to calculate and to interpret the efficiency of intellectual capital (IC) in a correct manner; and the role of IC on firm multicriteria performances.

A synopsis of key topics, issues and findings as presented at the 4th World Congress on Intellectual Capital hosted by McMaster University in Hamilton, Ontario, Canada. There were 536 delegates from 32 countries discussing the growing importance of intellectual capital. This paper highlights the key messages from the keynote speakers of the conference. Includes a summary of the presentations of such luminaries as Shahla Aly, VP Communication Sector at IBM Canada; Stephen Denning, KM director of the World Bank; Don Tapscott, chairman of Digital 4Sight; Ante Pulic and Ursula Schneider, directors of the Austrian Intellectual Capital Research Centre; Tom Jenkins, CEO of OpenText; Leif Edvinsson, VP of Knexa.com Enterprises; Verna Allee, president of Integral Performance Group; and Don Morrison, COO of Research in Motion.

This paper measured the intellectual capital performance of commercial banks in Malaysia for the period 2001 to 2003, using efficiency coefficient called VAIC™ developed by Ante Pulic.

Data required to calculate human capital, structural capital and capital employed efficiencies were obtained from annual reports.

As a whole, all banks have relatively higher human capital efficiency than structural and capital efficiencies. Domestic banks were generally less efficient compared to foreign banks. Hong Leong Bank, Public Bank and Southern Bank were the top three efficient domestic banks based on VAIC^TM assessment, while Scotia Bank is the most efficient foreign bank. Public Bank and EON Bank have consistently showed improvement in efficiency in the three years. There were significant differences between rankings of bank according to efficiency and traditional accounting measures. In view of the findings that seven out of ten domestic banks did not show improvement in efficiency following the consolidation exercise requires an urgent attention and remedial actions.

This study failed to study all foreign banks operating in Malaysia. Future study should therefore further improve on the aspect of coverage.

The findings allowed banks to benchmark themselves based on the level of efficiency rankings, to establish priorities and develop strategic plans, which will in turn enhance their future performance. The findings also could help stakeholders and investors assess the value creating potential of banks; and policy makers to formulate and implement policies for establishment of a resilient banking sector.

This study is the first study on Malaysian banks' intellectual capital performance.

The purpose of this paper is to study the relationship between intellectual capital (IC) and performance of pharmaceutical firms in India. The secondary objective is to propose and test modified models of Value Added Intellectual Coefficient (VAIC™) method.

Data on 22 large pharmaceutical firms collected for empirical investigation. Return on assets and return on sales are performance variables. IC and its components – human capital, structural capital and relational capital (RC), are predictor variables. Three extended and modified VAIC™ models (e-VAIC™) are proposed. Multiple regression technique is applied on pooled data to draw inferences.

Results show instances of positive relationship between IC and performance variables. RC, the new variable, does not demonstrate statistically significant relationship with performance variables.

Due to inadequate reporting of IC and its components, availability of data on various proxies is difficult. The new models proposed in this paper can be a template for future research and model development.

VAIC™ model, the proposed models (e-VAIC™) and the result analysis can be useful for evaluation and value creation purposes.

Previous researchers use original VAIC™ model. This paper modifies and extends the model in accordance with contemporary description and typology of IC. Inclusion of RC as a variable in VAIC™ model and use of new proxies for components of IC are the novelties of this paper.

The purpose of this study is to analyse the validity of the value added intellectual coefficient (VAIC) method as an indicator of intellectual capital.

The paper describes VAIC through its calculation formulae and aims to establish what exactly it is that the method measures. It also looks in detail at how intellectual capital is understood in the method, and discusses its conceptual confusions. Furthermore, the paper tests the hypothesis according to which VAIC correlates with a company's stock market value, and reflects the contradictory results of earlier studies.

The analyses show, first, that VAIC indicates the efficiency of the company's labour and capital investments, and has nothing to do with intellectual capital. Furthermore, the calculation method uses overlapping variables and has other serious validity problems. Second, the results do not lend support to the hypothesis that VAIC correlates with a company's stock market value. The main reasons behind the lack of consistency in earlier VAIC results lie in the confusion of capitalized and cash flow entities in the calculation of structural capital and in the misuse of intellectual capital concepts.

The analyses show that VAIC is an invalid measure of intellectual capital.

The result is important since the method has been widely used in micro and macro level analyses, but this is the first time it has been put to rigorous scientific analysis.

The purpose of this study is to investigate empirically the relationship between intellectual capital and financial performance of 65 Indian banks for a period of ten years from 1999 to 2008.

Reserve Bank of India's database and Annual reports, especially the profit and loss accounts and balance sheets of the banks for the relevant years have been used to obtain the data. Value added intellectual coefficient (VAIC™) method is applied for measuring the value based performance of banks. Return on assets (ROA) and return on equity (ROE) are used to measure the profitability and productivity of Indian banks, measured by assets turnover ratio (ATO). The intellectual capital (human capital and structural capital) and physical capital of selected banks have been analyzed and their impact on corporate performance has been measured using multiple regression technique.

The analysis indicates that the relationships between the performance of a bank's intellectual capital, and financial performance indicators, namely profitability and productivity, are varied. The study results suggest that banks’ intellectual capital is vital for their competitive advantage.

The study uses only 65 leading Indian banks, including foreign banks operating in India. The value added intellectual coefficient (VAIC™), introduced by Pulic, is used in this study as a basic methodology to measure the IC performance of banks.

The VAIC™ method can be used as an important tool by the decision makers in the knowledge economy to integrate the intellectual capital in the decision making process.

This is one of the first empirical researches in India that examines the impact of IC on financial performance of the Indian banking sector in the long term.

The purpose of this study is to examine the dynamic relationship between intellectual capital (IC) and its components on financial performance of banks within the selected eight countries of Association of Southeast Asian Nations (ASEAN).

The study utilizes the balanced panel data of 37 publicly listed banks from eight leading ASEAN economies for the period of 2017–2021. In this sense, the authors applied the Ante Pulic's typology, i.e. value-added intellectual coefficient (VAIC™) to evaluate the efficiency of intangible and tangible assets. While, investigating the dynamic nature of relationship, the authors employed the generalized system method of moments because of its power to account for the problem of endogeneity and heteroscedasticity.

The results of the study demonstrate that banks in ASEAN countries shed a varied degree of a spotlight on VAIC™ and its components to create value. The findings revealed that structural capital efficiency is significantly associated with earning per share (EPS), return on assets (ROA) and return on equity (ROE), compared to human capital efficiency (HCE) and capital employed efficiency of ASEAN banks. These results endorse the importance of resource- and knowledge-based views of organizations to leverage the financial performance of banks. However, contrary to theoretical expectations, this study found no positive relationship between HCE with ROA and ROE. Whereas, the relationship of VAIC™ is positive and significant with EPS and ROE but it remains statistically very marginal.

There are some inherent limitations in this study that could be opportunities for future research. The current study uses the VAIC™ typology, but future researchers can use the modified value-added intellectual coefficient (MVAIC) or triangulation approach to enhance the validity and reliability of the study. Additionally, future research can investigate the similarities and differences among countries in terms of their cultural backgrounds and regulatory frameworks regarding the disclosure of intangibles. Furthermore, future research can increase the length and sample size of the study to enhance its generalizability.

The robust empirical findings extend the academic debate on IC by unveiling the dynamic nature of relationship between IC and financial performance in context of ASEAN banking sector. The findings provide plausible recommendations for policy makers (managers, regulators and stakeholders) to understand how to increase the IC efficiently, especially human capital as a source to evaluate the firms’ ability in determining value-added and financial performance. Further, findings of this study also suggest that how can policy makers get the benefit by investing more on structural capital as a valuable strategic source to guarantee the optimal performance returns.

Prior studies on IC have been country- and firm-specific, utilizing cross-sectional research designs. However, this research contributes to the limited literature by investigating the dynamic nature of the relationship between IC and financial performance of banks in the context of ASEAN countries using micro-panel data.

The purpose of this paper is to examine the value relevance of intellectual capital (IC) by analysing the relationship between IC efficiency (ICE) and corporate book value of listed firms on main board of Nigeria Stock Exchange.

This study applies the resource-based theory in formulating two hypotheses that guide the results analysis. By employing a two-step dynamic system generalised method of moments (GMMs), and controlling for the possible endogeneity effect on the parameters estimated, for a sample of 91 listed firms on main board of Nigeria Stock Exchange, this study investigates the association of ICE and corporate book value, namely, cash flow from operation and economic value added (EVA), using data over the 2010 to 2014 financial years.

The results show a significant positive relationship between overall ICE and corporate book value (cash flow from operation and EVA). This study contributes to recent evidence concerning the value relevance of IC information to investors and other interested stakeholders.

The generalisation of the results to smaller firms, in the alternative securities market, may be inappropriate as study sampled listed firms on the main board of Nigerian Stock Exchange.

Those charged with governance should be concerned with the investment and management of IC as it enhances the economic value and operating cash flow in line with the resource-based theory.

This study is first to consider the ICE study across all sectors in the Nigerian economy using modified Pulic value added intellectual capital. The study controls for heteroscedasticity and endogeneity issues by adoption of two-step dynamic system GMMs.