THE IMPACT OF INTELLECTUAL CAPITAL ON ORGANIZATIONAL PERFORMANCE IN NIGERIA: A STUDY OF LISTED COMPANIES ON NIGERIAN STOCK EXCHANGE

Author: Aroh Nkechi
Department: Accountancy
Affiliation: Nnamdi Azikiwe University Awka

This study assessed the impact of the components of Intellectual Capital (Human Capital, Structural Capital, Relational Capital and Innovation Capital) of Companies listed on the Nigerian Stock Exchange so as to determine their relationship with financial performance. To achieve this objective, six research questions and hypotheses were raised and related literatures to the study were reviewed. Descriptive research design was adopted. Data were obtained through a Survey in which questionnaire was administered on a sample of 375 respondents drawn from a population of 546 derived from 182 companies. Data were also extracted from annual reports and account of the sampled companies. The data collected were analyzed using mean, variance and standard deviation. Pearson correlation coefficient was used to determine the relationship between the components of intellectual capital and financial performance while multiple regression was used to determine the combine effect of intellectual capital components on financial performance and whether the effect is moderated by type of company. The study obtained evidence that Human capital, Relational capital and Innovation capital have positive relationship with financial performance. Further empirical evidence revealed that there was a significant interaction between relational capital and company type but the strength of the relationship was stronger for non – service companies. The implication of the findings is that any company that fails to invest on relational capital component will expect a low/weak contribution to financial performance. We therefore recommend that companies should apply more of their intellectual capital investment budget on the relational capital component as it has stronger contribution to financial performance.

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