International Journal of Accounting, Finance and Risk Management

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Intellectual Capital and Organisational Performance of the Financial Sector: Evidence from Nigeria

Received: 14 December 2021    Accepted: 4 January 2022    Published: 12 January 2022
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Abstract

The world economy is moving to a knowledge-based economy from the industrial era. Prior studies have shown that reliance on physical and financial capital is not enough for sustained improved performance. Improved performance will continue to be of interest to management of organisations and to researchers and businesses should utilise strategic resources especially intangible ones (intellectual capital) to achieve competitive advantage. The study examined the effect of intellectual capital on organisational performance of financial companies quoted in Nigeria. The study adopted ex-post facto research design. The population was 53 financial companies listed on the Nigerian Stock Exchange (NSE) in 2019, from which 35 were purposively selected. The audited financial statements from 2010 to 2019 validated by the external auditors’ report were the data source. Descriptive and inferential statistics using regression analyses were employed. The Value-Added Intellectual Coefficient (VAIC) was used to measure intellectual capital (IC) and organizational performance had five measures of return of assets (ROA), return on equity (ROE), Leverage (Lev), Assets Turnover (ATO), and Market to Book Ratio (MB ratio). The study concluded that intellectual capital impacts positively on organizational performance, but firm size do not play a significant role. The study recommended that financial institutions should develop competencies by replacing the less-qualified performers, assist employees learn new management and technical skills through regular training and mentoring. Management should devise ways to improve employee’s competence in technical and information technology, in customer relation, suppliers’ management, projecting bank’s image, and a positive organizational culture to improve their intellectual capital stock.

DOI 10.11648/j.ijafrm.20220701.11
Published in International Journal of Accounting, Finance and Risk Management (Volume 7, Issue 1, March 2022)
Page(s) 1-10
Creative Commons

This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.

Copyright

Copyright © The Author(s), 2024. Published by Science Publishing Group

Keywords

Capital Employed, Financial Sector, Human Capital, Intellectual Capital, Structural Capital, Value-added Intellectual Coefficient (VAIC)

References
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  • APA Style

    Akintoye Ishola Rufus, Adegbie Folajimi Festus, Bello Isiaka Dada. (2022). Intellectual Capital and Organisational Performance of the Financial Sector: Evidence from Nigeria. International Journal of Accounting, Finance and Risk Management, 7(1), 1-10. https://doi.org/10.11648/j.ijafrm.20220701.11

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    ACS Style

    Akintoye Ishola Rufus; Adegbie Folajimi Festus; Bello Isiaka Dada. Intellectual Capital and Organisational Performance of the Financial Sector: Evidence from Nigeria. Int. J. Account. Finance Risk Manag. 2022, 7(1), 1-10. doi: 10.11648/j.ijafrm.20220701.11

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    AMA Style

    Akintoye Ishola Rufus, Adegbie Folajimi Festus, Bello Isiaka Dada. Intellectual Capital and Organisational Performance of the Financial Sector: Evidence from Nigeria. Int J Account Finance Risk Manag. 2022;7(1):1-10. doi: 10.11648/j.ijafrm.20220701.11

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  • @article{10.11648/j.ijafrm.20220701.11,
      author = {Akintoye Ishola Rufus and Adegbie Folajimi Festus and Bello Isiaka Dada},
      title = {Intellectual Capital and Organisational Performance of the Financial Sector: Evidence from Nigeria},
      journal = {International Journal of Accounting, Finance and Risk Management},
      volume = {7},
      number = {1},
      pages = {1-10},
      doi = {10.11648/j.ijafrm.20220701.11},
      url = {https://doi.org/10.11648/j.ijafrm.20220701.11},
      eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijafrm.20220701.11},
      abstract = {The world economy is moving to a knowledge-based economy from the industrial era. Prior studies have shown that reliance on physical and financial capital is not enough for sustained improved performance. Improved performance will continue to be of interest to management of organisations and to researchers and businesses should utilise strategic resources especially intangible ones (intellectual capital) to achieve competitive advantage. The study examined the effect of intellectual capital on organisational performance of financial companies quoted in Nigeria. The study adopted ex-post facto research design. The population was 53 financial companies listed on the Nigerian Stock Exchange (NSE) in 2019, from which 35 were purposively selected. The audited financial statements from 2010 to 2019 validated by the external auditors’ report were the data source. Descriptive and inferential statistics using regression analyses were employed. The Value-Added Intellectual Coefficient (VAIC) was used to measure intellectual capital (IC) and organizational performance had five measures of return of assets (ROA), return on equity (ROE), Leverage (Lev), Assets Turnover (ATO), and Market to Book Ratio (MB ratio). The study concluded that intellectual capital impacts positively on organizational performance, but firm size do not play a significant role. The study recommended that financial institutions should develop competencies by replacing the less-qualified performers, assist employees learn new management and technical skills through regular training and mentoring. Management should devise ways to improve employee’s competence in technical and information technology, in customer relation, suppliers’ management, projecting bank’s image, and a positive organizational culture to improve their intellectual capital stock.},
     year = {2022}
    }
    

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  • TY  - JOUR
    T1  - Intellectual Capital and Organisational Performance of the Financial Sector: Evidence from Nigeria
    AU  - Akintoye Ishola Rufus
    AU  - Adegbie Folajimi Festus
    AU  - Bello Isiaka Dada
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    T2  - International Journal of Accounting, Finance and Risk Management
    JF  - International Journal of Accounting, Finance and Risk Management
    JO  - International Journal of Accounting, Finance and Risk Management
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    EP  - 10
    PB  - Science Publishing Group
    SN  - 2578-9376
    UR  - https://doi.org/10.11648/j.ijafrm.20220701.11
    AB  - The world economy is moving to a knowledge-based economy from the industrial era. Prior studies have shown that reliance on physical and financial capital is not enough for sustained improved performance. Improved performance will continue to be of interest to management of organisations and to researchers and businesses should utilise strategic resources especially intangible ones (intellectual capital) to achieve competitive advantage. The study examined the effect of intellectual capital on organisational performance of financial companies quoted in Nigeria. The study adopted ex-post facto research design. The population was 53 financial companies listed on the Nigerian Stock Exchange (NSE) in 2019, from which 35 were purposively selected. The audited financial statements from 2010 to 2019 validated by the external auditors’ report were the data source. Descriptive and inferential statistics using regression analyses were employed. The Value-Added Intellectual Coefficient (VAIC) was used to measure intellectual capital (IC) and organizational performance had five measures of return of assets (ROA), return on equity (ROE), Leverage (Lev), Assets Turnover (ATO), and Market to Book Ratio (MB ratio). The study concluded that intellectual capital impacts positively on organizational performance, but firm size do not play a significant role. The study recommended that financial institutions should develop competencies by replacing the less-qualified performers, assist employees learn new management and technical skills through regular training and mentoring. Management should devise ways to improve employee’s competence in technical and information technology, in customer relation, suppliers’ management, projecting bank’s image, and a positive organizational culture to improve their intellectual capital stock.
    VL  - 7
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Author Information
  • Department of Accounting, Babcock University, Ilishan-Remo, Nigeria

  • Department of Accounting, Babcock University, Ilishan-Remo, Nigeria

  • Department of Accounting, Babcock University, Ilishan-Remo, Nigeria

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