Intellectual capital and bank performance: A board of directors’ agenda

Download This Article

This work is licensed under a Creative Commons Attribution 4.0 International License.

Abstract

The concept of intellectual capital pertains to intangible assets that are built on knowledge, such as the competencies of employees, procedures, and relationships with customers (Adesina, 2019). By analyzing a sample of 26 commercial banks in Vietnam from 2012–2021, this study aims to investigate the relationship between intellectual capital and the performance of these banks. Using the value-added intellectual coefficient (VAIC) model for measuring intellectual capital efficiency (ICE), we discover a positive influence of overall intellectual capital on the operational efficiency of banks. Regarding the specific components of intellectual capital, our findings validate that capital efficiency has the most significant influence on financial efficiency. The findings suggest that commercial banks need to actively invest in the various aspects of intellectual capital to enhance their market value and cash flow. Furthermore, it is imperative for commercial banks to reconsider their allocation of resources and investment plans, which might potentially result in a fundamental change in their strategy towards achieving sustainable growth. These tactics can enhance financial returns and offer a competitive advantage in a dynamic and demanding market environment.

Keywords: Intellectual Capital, Efficiency, Performance, Bank

Authors’ individual contributions: Conceptualization — A.P.; Methodology — T.H.T.L.; Investigation — A.P.; Resources — T.H.T.L.; Data Curation — A.P. and T.H.T.L.; Writing — Original Draft — A.P. and T.H.T.L.; Writing — Review & Editing — A.P. and T.H.T.L.; Supervision — A.P.; Funding Acquisition — A.P.

Declaration of conflicting interests: The Authors declare that there is no conflict of interest.

JEL Classification: G21, J24, O15

Received: 27.03.2024
Accepted: 20.12.2024
Published online: 25.12.2024

How to cite this paper: Phan, A., & Le, T. H. T. (2024). Intellectual capital and bank performance: A board of directors’ agenda. Corporate Board: Role, Duties and Composition, 20(3), 128–138. https://doi.org/10.22495/cbv20i3art12