Determinants of Intellectual Capital Performance of GCC Listed Banks

This study examines the level of intellectual capital (IC) performance of listed banks in the Arab Gulf Cooperation Council (GCC) countries using VAIC methodology and investigates the hypothesized impact of corporate governance variables (namely board diversity and ownership structure), bank specific characteristics (namely bank internationality, financial performance, bank adherence to Islamic Shariah principles, and bank risk), banking industry characteristics (namely banking industry concentration and presence of foreign banks) and macroeconomic environment on IC performance. In addition, this study determines the moderating role of the frequency of board meetings in the relationship between board diversity and IC performance. Multiple regression analyses are used to analyze the data. Hierarchical regression analysis is employed to examine if the frequency of board meetings moderates the relationship between board diversity and IC performance. The results of a survey of a sample of 128 GCC listed banks for the period 2008-2010, show that IC performance of GCC listed banks is low. Findings show that board interlocking, board size, representation of independent directors, family ownership, government ownership (when a government holds a majority of shares that is 51% or more), domestic strategic ownership, and domestic non-strategic ownership have significant relationships with IC performance. In addition, this study provides evidence that except for bank internationality, bank specific characteristics, banking industry characteristics, and macroeconomic environment play important roles in determining IC performance among GCC banks. Furthermore, the results generally do not support the study`s hypothesis that the impact of board diversity on IC performance is positive as the frequency of board meetings increases. The result of this study contributes to the body of knowledge in IC-related studies, particularly with regards to the determinants of IC performance. Findings provide some input to investors, managers, regulators and policymakers, as well as researchers in addressing the factors affecting IC performance

Intellectual capital and its effect on financial performance of banks: Evidence from Saudi Arabia

This study examines intellectual capital (IC) performance of listed banks in Saudi Arabia using value-added intellectual coefficient (VAIC) methodology, and investigates the impact of IC on financial performance.It identifies the IC components that may be the drivers of the traditional indicators of bank success.The results of a survey of a sample of all listed banks during 2008 to 2010, show that IC performance of Saudi banks is low and it is positively associated with bank financial performance indicators.However, when VAIC is split into its components, the relationships between these components and bank financial performance indicators vary

Cross-country comparison of intellectual capital performance and its impact on financial performance of commercial banks in GCC countries

Purpose – The purpose of this paper is to explore the intellectual capital (IC) performance of banks in Gulf Cooperation Council (GCC) countries and to empirically investigate if IC has an impact on financial performance as well as to identify the IC components that may be the drivers of the traditional indicators of bank success. Design/methodology/approach – The empirical data are drawn from banks’ annual reports over the three-year period of 2008 to 2010. Ordinary least squares regression analysis is constructed to examine the relationships between IC and the banks’ financial performance indicators. Pulic’s value-added intellectual coefficient method (VAIC) is applied to measure IC performance. Findings – Empirical findings, after controlling for bank size and global financial crisis, indicate that IC is positively associated with bank financial performance indicators in all GCC countries. However, when VAIC is split into its three components, the relationships between these components and bank financial performance indicators are varied.Research limitations/implications – The main limitation of this study is the use of IC measurement model. Its basic advantage (simplicity and ease of use) is also its main limitation. The main problem is measuring the contribution of something which is not physical and cannot be easily quantified. The key issue is that the value created by IC is indirect. However, at present, no perfect solution is available for intellectual capital measurement, as the area is still exploring the best possible solutions. Practical implications – The results may extend the understanding of the role of IC in banking sector in GCC region and may give inputs to managers of GCC banks to structure relevant strategies to obtain, utilize, develop and retain IC. The findings also could help policy makers in GCC to formulate and implement policies for establishing a resilient banking sector. Originality/value – This study adds to the literature by extending the knowledge of IC performance and its utilization for increasing the financial performance of GCC banks. There has only been one previous empirical study that explores the IC and its relationship with the traditional measures of bank performance in GCC region (only in Bahrain). It is the first comparative study across GCC countries

Board diversity and intellectual capital performance

Purpose– The purpose of this paper is to investigate if the effectiveness of board meetings moderates the relationship between board diversity (in terms of educational level and nationality) and intellectual capital (IC) performance. Design/methodology/approach– The empirical data are drawn from banks’ annual reports over the three-year period of 2008 to 2010. Public’s value-added intellectual coefficient method is applied to measure IC performance. The frequency of board meetings is used a proxy for board meeting effectiveness.Findings– Based on the hierarchical regression analysis, our results do not support the hypothesis that the effect of board diversity on IC performance is positive as the effectiveness of board meetings increases.Practical implications – Findings of this study indicate that there is a need for more effective meetings through providing appropriate and sufficient information to directors, particularly in strategic issues such as those related to IC that could make board members better prepared and more involved in meetings.Originality/value– This study adds to the literature, as it is the first study that explores the variables that could affect the relationship between board diversity and IC performance in the context of banks

Evaluation of the knowledge and practices of pregnant Yemeni Women regarding teratogens

Purpose: To investigate the knowledge and practice of pregnant women with regards to teratogens.Methods: A month-long cross-sectional study was carried out among 150 pregnant women selected from four Motherhood and Child Healthcare Centers (MCHCs) in Mukalla District of Yemen. Data collection was conducted during face-to-face interviews using a questionnaire. Descriptive and simple regression analyses were used.Results: Of the 150 pregnant women who participated in the study, 95.3 % of the pregnant women were < 36 years old, 7.4 % had children with congenital malformations, 62 % indicated that they had heard about folic acid; however, only 16.6 % knew the significance of folic acid. Regarding toxoplasmosis, 94.7 % indicated that they had heard about toxoplasmosis, and 76 % knew about the serious consequences of the disease (congenital malformation and abortion) during pregnancy. Based on simple regression analysis, the results indicate that education and parity, irrespective of age or income level, were the major factors determining better knowledge and practices in pregnancy with regards to toxoplasmosis.Conclusion: Knowledge of folic acid deficiency among pregnant women in Mukalla District of Yemen is relatively low. Furthermore, preventive practices to avoid folic acid deficiency are minimal.Keywords: Knowledge, Practices, Teratogens, Pregnant Yemeni women, Folic acid deficienc

Religiosity, accounting expertise, and audit report lag: Empirical evidence from the individual level

Motivated mainly by three streams of research on religiosity and accounting expertise, this study investigates the effect of religiosity and accounting expertise on audit report lag. Using a unique sample and pooled regressions, it finds that the religiosity of top leaders, for example, Chief Executive Officer (CEO) and audit committee (AC) chair, is not associated with shorter audit report lag. Consistent with prior research, it reports that the accounting expertise of top leaders is significantly associated with shorter audit report lag. More importantly, it documents that a religious top leader with accounting expertise is significantly associated with a greater reduction in audit report lag. Robustness checks are applied by conducting a variety of tests, resulting in similar findings. In additional analysis, this paper documents that religious and accounting expertise of top leaders are associated with abnormal decrease in audit report lag and that Big4 audit firms interact with the religiosity and accounting expertise of the AC chair more than the CEO. Overall, this study sheds light on the added value of religiosity and accounting expertise in the context of audit report lag