The impact of intellectual capital on company financial performance: Evidence from the Omani industrial sector
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Author(s)Serhii LehenchukLink to ORCID Index: http://orcid.org/0000-0002-3975-1210
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Dmytro ZakharovLink to ORCID Index: https://orcid.org/0000-0003-3423-0093
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Iryna VyhivskaLink to ORCID Index: https://orcid.org/0000-0002-4974-5834
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Viktoriia MakarovychLink to ORCID Index: https://orcid.org/0000-0002-0684-7072
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Yaroslav SheveriaLink to ORCID Index: https://orcid.org/0000-0001-6341-8533
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DOIhttp://dx.doi.org/10.21511/imfi.21(1).2024.26
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Article InfoVolume 21 2024, Issue #1, pp. 343-355
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23 Downloads
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Creative Commons Attribution 4.0 International License
The article aims to investigate, using the VAIC and MVAIC models, the impact of intellectual capital on the financial performance of Omani companies listed on the Muscat Stock Exchange from 2017 to 2021. Regression analysis revealed a significant positive influence of VAIC and MVAIC only on the Asset Turnover Ratio at a 10% significance level. This suggests that an increase in VAIC or MVAIC by one unit could lead to a respective increase in earnings for Omani listed industrial companies by 0.0017 and 0.0016. However, the overall impact of VAIC and MVAIC on financial performance appears limited, necessitating measures for enhanced efficacy. Moreover, company size and leverage were found to significantly influence EBITDA and Return on Assets, suggesting the positive effect of increased activity and resource utilization. Conversely, Return on Customer Equity negatively affected only Asset Turnover Ratio, implying that investments in marketing and advertising may not significantly enhance financial performance. Human Capital Efficiency showed no significant impact on financial performance measures, highlighting the necessity for Omani industrial enterprises to focus on enhancing employee skills and experience for improved value-creation processes. These findings underscore the intricate relationship between intellectual, physical, and financial capital in shaping financial performance, necessitating targeted strategies for enhancement. Further analysis of suggested models indicated the significance of company size on EBITDA, highlighting the importance of scaling activities for performance improvement. VAIC and MVAIC structural elements showed mixed results, while Capital Employed Efficiency negatively affected Return on Equity, Structural Capital Efficiency positively impacted EBITDA and Asset Turnover Ratio.
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JEL Classification (Paper profile tab)G17, O34
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References27
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Tables5
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Figures1
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- Figure 1. Conceptual framework of the study
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- Table 1. Summary of all dependent and independent variables, calculation methods, and abbreviations used in the study
- Table 2. Explanation of the selected variables and descriptive statistics (based on observations: 1:1 – 34:5)
- Table 3. Correlation coefficients, based on observations 1:1 – 34:5
- Table 4. Results of panel data estimate parameter selection for each of the models used in the study
- Table A1. Analyzed PERF models (Pooled OLS, FEM, REM)
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Industrial development in Saudi Arabia: disparity in growth and development
Anis Ali
doi: http://dx.doi.org/10.21511/ppm.18(2).2020.03
Problems and Perspectives in Management Volume 18, 2020 Issue #2 pp. 23-35 Views: 2543 Downloads: 877 TO CITE АНОТАЦІЯIndustrial development in any nation plays a vital role in the strengthening of the economy and employs human resources as per specifications and directly towards the mainstream of the nation. In Saudi Arabia, there was rapid industrialization for four decades. Some manufacturing industries performed well, while some internal and external business environment factors influenced the others’ performance. The study focuses on historical development, as well as recent trends of well-performing and poor-performing industries of Saudi Arabia. Small manufacturing industries in Saudi Arabia are underdeveloped and need more attention to attain sustainable and progressive growth rate in the form of the number of establishments to enjoy the potential. Manufacture of tobacco, computer, electronics and optics, pharmaceuticals and transport equipment are the deprived and underdeveloped industries of the manufacturing sector. There should be some easy credit schemes for the development of deprived or underdeveloped manufacturing industries. To attain sustainable growth and development of the manufacturing sector, a positive attitude of the government towards underdeveloped manufacturing industries, favorable labor laws, and entrepreneurial awareness, technical and financial assistance are necessary. The growth and development of the manufacturing sector of Saudi Arabia will be helpful in the attainment of goals of Vision 2030.
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Why banks should consider ESG risk factors in bank lending?
Sarwar Uddin Ahmed ,
Samiul Parvez Ahmed ,
Ikramul Hasan
doi: http://dx.doi.org/10.21511/bbs.13(3).2018.07
Banks and Bank Systems Volume 13, 2018 Issue #3 pp. 71-80 Views: 2511 Downloads: 985 TO CITE АНОТАЦІЯWhy banks should be concerned about incorporating environmental, social and governance (ESG) criteria in the lending process? What is the motivation? This study aims to find the motives for considering environmental, social and governance (ESG) criteria in bank lending process. A primary survey has been conducted to know the current status and motivation for incorporating ESG factors in investment decisions. Sample comprised 30 private commercial banks (PCBs) operating in Bangladesh. Data collected were analyzed with graphs, descriptive statistics, and regression analysis. Findings of the study indicate that banks are mostly considering basic environmental, social and governance factors set by regulators qualitatively. They are lagging behind in considering the advanced ESG criteria needed for sustainable and efficient credit risk management. Based on motivation for incorporating ESG factors, it was found that banks pioneering in incorporating ESG factors in lending decisions are compensated through better financial performance. Findings of the study are expected to encourage practitioners and policy-makers to take more pragmatic steps to incorporate ESG risk factors quantitatively in lending decision-making process.
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Integrated reporting and financial performance of South African listed banks
Reon Matemane ,
Rozane Wentzel
doi: http://dx.doi.org/10.21511/bbs.14(2).2019.11
Banks and Bank Systems Volume 14, 2019 Issue #2 pp. 128-139 Views: 2464 Downloads: 493 TO CITE АНОТАЦІЯThe recent development of integrated reporting intends to address the limitations associated with corporate reporting practices. This paper aims to examine whether a statistically significant relationship exists between integrated reporting quality and financial performance. Secondary data was used, namely the integrated reports and annual financial statements of South African banks listed on the Johannesburg Stock Exchange (JSE) for 2010–2014. For the period 2005–2009, only the financial statements were used, since integrated reporting was not yet mandatory. The research design was longitudinal and it combined qualitative and quantitative methods. Descriptive statistics and Feasible Generalized Least Square (FGLS) were used to explore the relationships between financial performance and integrated reporting quality. The results indicate that there is a positive relationship between integrated reporting quality (IRQ) and earnings per share (EPS). However, there is no significant relationship between IRQ and Tobin’s q (Q-Ratio), IRQ and return on equity (ROE), IRQ and return on assets (ROA) as well as IRQ and economic value added (EVA). Moreover, there are no significant differences on the financial performance of the listed banks before and after the introduction of integrated reporting.
