Exploring the nexus of corporate governance and intellectual capital efficiency: from the lens of profitability

Previous literature revealed that corporate governance (CG) attributes enhance firm performance. However, scant empirical research is available on how the CG attributes improve the intellectual capital (IC) efficiency. To fill this gap, the present study explores the effect of CG on IC efficiency. T...

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Main Authors: Shahzad, K., Shah, S.Q.A., Lai, F.-W., Jan, A.A., Shah, S.A.A., Shad, M.K.
Format: Article
Institution: Universiti Teknologi Petronas
Record Id / ISBN-0: utp-eprints.33391 /
Published: Springer Science and Business Media B.V. 2022
Online Access: https://www.scopus.com/inward/record.uri?eid=2-s2.0-85133433922&doi=10.1007%2fs11135-022-01472-z&partnerID=40&md5=c05b6a3076365ac12aa45a4860f65dfc
http://eprints.utp.edu.my/33391/
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spelling utp-eprints.333912022-07-26T08:45:44Z Exploring the nexus of corporate governance and intellectual capital efficiency: from the lens of profitability Shahzad, K. Shah, S.Q.A. Lai, F.-W. Jan, A.A. Shah, S.A.A. Shad, M.K. Previous literature revealed that corporate governance (CG) attributes enhance firm performance. However, scant empirical research is available on how the CG attributes improve the intellectual capital (IC) efficiency. To fill this gap, the present study explores the effect of CG on IC efficiency. This study also intends to explore the moderating role of profitability on the nexus of CG and IC to identify whether it affects physical and intellectual capabilities. Using the census sampling technique, this study utilized the panel data of services firms in Pakistan over the period 2016�2020. The study adopted Pulic�s model for computing IC efficiency, i.e., the value-added intellectual capital coefficient model. Fixed-effect model and two-stage least squares were utilized for the regression analysis. The study�s findings revealed that independent directors, the board size, audit committee, and remuneration committee have a significant negative relationship with IC efficiency. CEO duality has demonstrated a significant positive nexus with IC efficiency. Interestingly, the negative coefficient of audit and remuneration committees becomes positive with the moderation of profitability. This study adds to the literature on the vital role of CG in fostering IC efficiency. The findings of this study might be helpful for the policymakers, practitioners, and researchers to put in place a solid corporate governance structure that enhances physical and intellectual capabilities. © 2022, The Author(s), under exclusive licence to Springer Nature B.V. Springer Science and Business Media B.V. 2022 Article NonPeerReviewed https://www.scopus.com/inward/record.uri?eid=2-s2.0-85133433922&doi=10.1007%2fs11135-022-01472-z&partnerID=40&md5=c05b6a3076365ac12aa45a4860f65dfc Shahzad, K. and Shah, S.Q.A. and Lai, F.-W. and Jan, A.A. and Shah, S.A.A. and Shad, M.K. (2022) Exploring the nexus of corporate governance and intellectual capital efficiency: from the lens of profitability. Quality and Quantity . http://eprints.utp.edu.my/33391/
institution Universiti Teknologi Petronas
collection UTP Institutional Repository
description Previous literature revealed that corporate governance (CG) attributes enhance firm performance. However, scant empirical research is available on how the CG attributes improve the intellectual capital (IC) efficiency. To fill this gap, the present study explores the effect of CG on IC efficiency. This study also intends to explore the moderating role of profitability on the nexus of CG and IC to identify whether it affects physical and intellectual capabilities. Using the census sampling technique, this study utilized the panel data of services firms in Pakistan over the period 2016�2020. The study adopted Pulic�s model for computing IC efficiency, i.e., the value-added intellectual capital coefficient model. Fixed-effect model and two-stage least squares were utilized for the regression analysis. The study�s findings revealed that independent directors, the board size, audit committee, and remuneration committee have a significant negative relationship with IC efficiency. CEO duality has demonstrated a significant positive nexus with IC efficiency. Interestingly, the negative coefficient of audit and remuneration committees becomes positive with the moderation of profitability. This study adds to the literature on the vital role of CG in fostering IC efficiency. The findings of this study might be helpful for the policymakers, practitioners, and researchers to put in place a solid corporate governance structure that enhances physical and intellectual capabilities. © 2022, The Author(s), under exclusive licence to Springer Nature B.V.
format Article
author Shahzad, K.
Shah, S.Q.A.
Lai, F.-W.
Jan, A.A.
Shah, S.A.A.
Shad, M.K.
spellingShingle Shahzad, K.
Shah, S.Q.A.
Lai, F.-W.
Jan, A.A.
Shah, S.A.A.
Shad, M.K.
Exploring the nexus of corporate governance and intellectual capital efficiency: from the lens of profitability
author_sort Shahzad, K.
title Exploring the nexus of corporate governance and intellectual capital efficiency: from the lens of profitability
title_short Exploring the nexus of corporate governance and intellectual capital efficiency: from the lens of profitability
title_full Exploring the nexus of corporate governance and intellectual capital efficiency: from the lens of profitability
title_fullStr Exploring the nexus of corporate governance and intellectual capital efficiency: from the lens of profitability
title_full_unstemmed Exploring the nexus of corporate governance and intellectual capital efficiency: from the lens of profitability
title_sort exploring the nexus of corporate governance and intellectual capital efficiency: from the lens of profitability
publisher Springer Science and Business Media B.V.
publishDate 2022
url https://www.scopus.com/inward/record.uri?eid=2-s2.0-85133433922&doi=10.1007%2fs11135-022-01472-z&partnerID=40&md5=c05b6a3076365ac12aa45a4860f65dfc
http://eprints.utp.edu.my/33391/
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score 11.62408

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