Empirical Evaluation of Effects of Intellectual Capital Efficiency on Firm’s Value in Some Selected Listed Firms on Nigerian Exchange Group Authors PeterMario Efesiri EFENYUMI PhD Scholar, Department of Accountancy, Nnamdi Azikiwe University, Awka, Anambra State, Nigeria. https://orcid.org/0000-0001-5211-2512 Prof Emma Okoye Professor of Accounting , Nnamdi Azikiwe University Awka, Anambra State, Nigeria Dr. Ugoo Nwoye Lecturer Department of Accountancy Nnamdi Azikiwe University, Anambra State, Nigeria DOI: https://doi.org/10.47505/IJRSS.2022.V3.6.3 Keywords: Knowledge Capital, Intellectual Capital Efficiency, Value Creation, Tobins Q, KnowledgValue Added Intellectual Coefficient Abstract This contemporary world of economy driven by information and communication technology (ICT) has at its heart the dynamic force of knowledge and human capital development, pivotal to a standard capital market of a world class, has become a very vital and precious asset to organisations. This study examined the effect of Intellectual Capital Efficiency on Firm’s Value in Some Selected Listed Firms on Nigerian Exchange Group. Data for the study were extracted from annual reports and accounts of thirty one selected companies for the period 2016-2021. Data for Intellectual Capital Efficiency proxy by Modified Value Added Intellectual Coefficient (M-VAIC=HCE,SCE,RCE and CEE) and Firm’s value estimated by Market to Book Value(M/BV), Earnings Per Share (EPS) and Tobin Q (TQ) were extracted from the annual reports and accounts of selected companies. Three research hypotheses were formulated and tested adopting both descriptive statistics and simple regression techniques (OLS) with the aid of Stata 13.0 software. The findings revealed that M-VAIC have positive and significant effect on M/BV,EPS and TQ of Some Selected Listed Firms. Also, the introduced control variable (firm size) has a positive relationship and significant effect M/BV,EPS and TQ of Some Selected Listed Firms in Nigeria. Consequent upon this study, it was recommended that the importance of the intellectual capital should not be undermined and the mechanism, through which intellectual and human capital flow should be developed, maintained and improved; Since ICE has been shown to be the key driver of value creation, deliberate efforts should be made to grow IC of firms by first recruiting very competent staff, train and motivate them. Companies must strategically and deliberately train and retain staff for a long time to avoid losing the intellectual assets possessed by them, which could stimulate better future value and firms should invest in knowledge capital (that is intellectual capital), information technology (ICT) that can help they increase in their structural capital by harnessing information technology. References Ahanger, R.G. (2011). The relationship between intellectual capital and financial performance: An empirical investigation in an Iranian company. African Journal of Business Management, 5(1), 88-95. Anuonye, B. N. (2015). Intellectual capital measurement: Using the Earnings per share model of quoted insurance companies in Nigeria. CSC Canada International Business and Management, 10(1), 88-98. Becker, B. E., Huselid, M. A., and Ulrich, D. (2001). The HR scorecard. Journal of Financial Economics, 102(1), 227-228. Berzkalne, I., and Zelgalve, E., (2014). Intellectual capital and company value. Contemporary Issues in Business, Management and Education, 110, 887-896. Chen, M. C., Cheng, S. J., and Hwang, D. Y. C. (2005). An empirical investigation of the relationship between intellectual capital and firms’ market value and financial performance. Journal of Intellectual Capital, 6(2), 159-176 Edvinsson, L., and Malone, M. (1997). Intellectual capital: realising your company's true value by finding its hidden brain power. Journal of Human Resources Accounting, 4(1), 21-33. Ewereoke, V. (2018). Effect of intellectual capital on performance of firms listed on Nigeria stock exchange. Research Journal of Finance and Accounting, 9(8), 138-150. Freeman, R. E., and Reed. (1983). Stockholders and stakeholders: a new perspective on corporate governance. Californian Management Review. 25(2), 88-106. Henry, L. (2013). Intellectual capital in a recession: Evidence from UK SMEs. Journal of Intellectual Capital, 14(1), 84-101. Maditinos, D., Chatzoudes, D., Tsairidis, C., and Theriou, G. (2011). The impact of intellectual capital on firm’s market value and financial performance. Journal of Intellectual Capital, 12(1) 132-151. Makki, M. A. M., and Lodhi, S. A. (2008). Impact of intellectual capital efficiency on profitability (A case study of LSE 25 companies). Lahore Journal of Economics, 2(13), 81-98. Melendez, D. (2017). The impact of intellectual capital on firm’s performance (Bachelor’s Thesis, University of Oulu, Finland). Retrieved from http://jultika.oulu.fi/files/nbnfioulu-201705061712.pdf Mojtahedi, P. (2013). Intellectual capital accounting and its impact on organizational financial performance: Evidence from Malaysian firms. Journal of Basic and Applied Scientific Research, 3(3), 840-845 Muna, N. (2014). Pengaruh Intellectual Capital terhadap Retun Saham Melalui Kinerja Keuangan pada Perusahaan Real Estate dan Properti yang terdaftar di Bursa Efek Indonesia (BEI) Tahun 2010-2012. [Theses]. Indonesia: Universitas Diponegoro Semarang. Namazi, M., and Ibrahimi, S. (2009). The effect of intellectual capital on the future and current financial performance of accepted companies of Tehran's Stock Exchange. Accounting Research, 4, 1-23. Nikmah, R., and Aida, I. (2015). Intellectual capital, firm value and financial performance in Australia. Journal of Intellectual Capital, 12(4), 505-530. Nuryaman, (2015). The influence of intellectual capital on the firm’s value with the financial performance as intervening variable. Procedia-Social and Behavioral Sciences, 211, 292- 298. Ofurum, C.O., Onuaha, T. E., and Nwaekpe, U. C. (2018). Intellectual capital reporting and corporate financial performance of quoted firms in Nigeria. International Journal of Advanced Academic Research Business Development & Management, 4(2), 1-24. Onyekwelu, U. L., and Ubesie. M. C. (2013). Effect of intellectual capital on corporative valuation of quoted pharmaceutical firms in Nigeria. International Journal of Business and Management Review, (4)7, 30-39. Petrash, G. (1996). Dow’s journey to a knowledge value management culture. European Management Journal, 365-373. Pulic, A. (2004). Intellectual capital - does it create or destroy value? Measuring Business Excellence, 8(12), 62-68. Randa, F. and Ariyanto. S. (2012). Pengaruh modal intelektual terhadap nilai perusahan. Jurnal Sistem Informasi Manajemen dan Akuntansi, 10(1), 24-27 Randa, F., and Solon, S. A. (2012). Pengaruh modal intelektual terhadap nilai perusahaan (Studi empiris pada perusahaan manufaktur yang terdaftar di bursa efek Indonesia). Jurnal Sistem Informasi Manajemen dan Akuntansi. 10 (1), 24-47 Saeed, F., Farahmand, S., and Khorasani, M. (2013). Impact of intellectual capital on financial performance. International Journal of Academic Research in Economics and Management Sciences, 2(1) 1-8. Salman, R.T., Mansor, M., Babatunde, D. A., and Tayib, M. (2012). Impact of intellectual capital on return on assets in Nigeria manufacturing companies. Interdisciplinary Journal of Research in Business, 2(4), 21-30. Sawarjuwono, T., and Kadir, A. P. (2003). Intellectual Capital: Perlakuan, Pengukuran dan Pelaporan (Sebuah Library Research). Jurnal Akuntansi dan Keuangan. 5(1), 31-51. Shiri, M. M., Mousavi, K., Pourreza, A., and Ahmadi, S. (2012). The effect of intellectual capital on market value added. Journal of Basic and Applied Scientific Research, 2(7), 7214- 7226. Sofian, S., Rasid, S. Z. A., and Mehri, M. (2011). Conservatism of intellectual capital and relevance of earnings. International Journal of Business and Social Science, 2(10), 26-30. Solikhah, B. (2010). Pengaruh Intellectual Capital terhadap Kinerja Keuangan, Pertumbuhan dan Nilai Pasar pada Perusahaan yang Tercatat di Bursa Efek Indonesia. Tesis. Universitas Diponegoro. Sudibya, D. C. N. A., and Restuti, M. M. D. (2014). Pengaruh Modal Intelektual terhadap Nilai Perusahaan dengan Kinerja Keuangan sebagai Variabel Intervening. Seminar Nasional dan Call for Paper (Sancall 2014). Research Methods and Organizational Studies. 154-166. Sunarsih, N. M., and Mendra, N. P. Y. (2012). Pengaruh modal intelektual terhadap nilai perusahaan dengan kinerja keuangan sebagai variabel intervening pada perusahaan yang terdaftar di bursa efek Indonesia. Simposium Nasional Akuntansi XV. Banjarmasin. Ownership structure and intellectual capital performance in Malaysia. Asian Academy of Management Journal of Accounting and Finance, 5(1), 76-94. Tan, P. H., Plowman, D., and Hancock, P. (2007). Intellectual capital and financial returns of companies. Journal of Intellectual Capital, 8(1) 76-95. Wernerfelt, B., 1984. A resource-based view of the firm. Strategic Management Journal, (Studi Empiris pada Perusahaan Manufaktur yang Terdaftar di Bursa Efek [e-journal] 5(2). Ulum, I. (2008). Intellectual Capital dan Kinerja Keuangan Perusahaan: Suatu Analisis dengan Pendekatan Partial Least Squares. Simposium Nasional Akuntansi XI Pontianak Ulum, I. (2014). Intellectual Capital Performance of Indonesian Banking Sector: A Modified VAIC (M-VAIC) Perspective. Asian Journal of Finance and Accounting, 6(2), 103-123 Ulum, I., Ghozali, I., and Purwanto, I. (2014). Intellectual capital performance of Indonesian banking sector: A modified VAIC (M-VAIC) perspective. Asian Journal of Finance and Accounting, 6(6), 103-123. Ulum, I., Riziquiyah, and Jati, A. W. (2016). Intellectual capital performance: A comparative study between financial and non-financial industry of Indonesian biggest companies. International Journal of Economics and Finance Issues, 6(4), 1436-1439. Zarei, A., Shamszadeh, B., and and Zarei, Z. (2015). The effects of intellectual capital on financial performance of banks listed in Tehran stock exchange. Journal of Money and Economy, 9(4), 49-71 Zou, X., and Huan, T. (2011). A study of the intellectual capital’s impact on listed banks’ performance in China. African Journal of Business Management, 5(12), 5001-5009 Downloads Pdf How to Cite EFENYUMI, P. E., OKOYE, E. I. ., & NWOYE , J. U. . (2022). Empirical Evaluation of Effects of Intellectual Capital Efficiency on Firm’s Value in Some Selected Listed Firms on Nigerian Exchange Group. International Journal of Research in Social Science and Humanities (IJRSS) ISSN:2582-6220, DOI: 10.47505/IJRSS, 3(6), 16–37. https://doi.org/10.47505/IJRSS.2022.V3.6.3 More Citation Formats ACM ACS APA ABNT Chicago Harvard IEEE MLA Turabian Vancouver Download Citation Endnote/Zotero/Mendeley (RIS) BibTeX Issue Vol. 3 No. 6: IJRSS June-2022 Section Articles License Copyright (c) 2022 PeterMario Efesiri EFENYUMI, Prof Emma Okoye, Dr. Ugoo Nwoye This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.