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Propensity for and Quality of Intellectual Capital Divulgence Across the BRICS Banking Sector: A Knowledge-Based Perspective from Emerging Economies

Author

Listed:
  • Wasim ul Rehman

    (University of the Punjab Gujranwala Campus)

  • Suleyman Degirmen

    (Konya Food and Agriculture University)

  • Fareeha Waseem

    (University of the Punjab Quaid-E-Azam Campus)

Abstract

The study seeks to identify patterns of the propensity for (frequency) and quality of (mean score) intellectual capital (IC) divulgence components (internal capital, external capital and human capital) of banks from Brazil, Russia, India, China and South Africa (“BRICS”). The research typology constructs a 5-year (2015–2019) IC disclosure index utilizing the content analysis of the annual reports and Web sites of the ten largest BRICS banks. The study selected banks according to their asset portfolios. It applies content analysis for the codification of qualitative information into quantitative patterns and principles. The findings reveal that the IC disclosure practices of BRICS banks fall into modest to satisfactory positions in all three selected categories of IC classifications. Also, the propensity for and quality of IC disclosure alters due to the non-occurrence of IC frameworks and reporting mechanisms in BRICS banks. Disparity emerges between voluntary IC disclosure and the nominal role of institutional forces in banks. Although BRICS banks had better commitments to revealing valuable information about intangibles, IC managers developed the appropriate mechanisms to capture and report the hidden values of intangibles while demonstrating “licensing agreements,” “entrepreneurial abilities,” “financial relations,” and “job-associated knowledge.” Cross-sectional data in prior studies on IC disclosure are country- and firm-specific. Thus, this is among rare studies on longitudinal analysis that investigates the propensity for and quality of IC disclosure practices in the banking sector. It also incorporates a quality index of IC disclosure requiring underpinnings of institutional and resource-based views. In conclusion, institutional and resource-based factors influence the IC disclosure practices of BRICS banks. This is significant for the users of annual reports and Web sites who want to pursue IC-related information.

Suggested Citation

  • Wasim ul Rehman & Suleyman Degirmen & Fareeha Waseem, 2022. "Propensity for and Quality of Intellectual Capital Divulgence Across the BRICS Banking Sector: A Knowledge-Based Perspective from Emerging Economies," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 13(2), pages 1028-1055, June.
    • Handle: RePEc:spr:jknowl:v:13:y:2022:i:2:d:10.1007_s13132-021-00730-z
    DOI: 10.1007/s13132-021-00730-z
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    References listed on IDEAS

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    1. Johan Roos & Göran Roos & Nicola Carlo Dragonetti & Leif Edvinsson, 1997. "Intellectual Capital," Palgrave Macmillan Books, Palgrave Macmillan, number 978-1-349-14494-5, December.
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    5. Johan Roos & Göran Roos & Nicola Carlo Dragonetti & Leif Edvinsson, 1997. "Developing an Intellectual Capital System: the Process Model," Palgrave Macmillan Books, in: Intellectual Capital, chapter 3, pages 59-77, Palgrave Macmillan.
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    7. Foong Soon Yau & Loo Sin Chun & Rajeswary Balaraman, 2009. "Intellectual Capital Reporting and Corporate Characteristics of Public‐Listed Companies in Malaysia," Journal of Financial Reporting and Accounting, Emerald Group Publishing Limited, vol. 7(1), pages 17-35, December.
    8. Niamh Brennan, 2001. "Reporting intellectual capital in annual reports : evidence from Ireland," Open Access publications 10197/2918, Research Repository, University College Dublin.
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    1. Wasim ul Rehman & Faryal Jalil & Omur Saltik & Suleyman Degirmen & Mustafa Bekmezci, 2024. "Leveraging Strategic Innovation and Process Capabilities for Intellectual Capital Initiative Performance of Higher Education Institutes (HEIs): A Knowledge-Based Perspective," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(1), pages 4161-4202, March.

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