Corporate Governance Mechanisms and Intellectual Capital Disclosure in Market for Alternative Investment of Thailand
Article Sidebar
Main Article Content
Abstract
This research aims to study 1) the relationship between corporate governance mechanisms and financial disclosure of intellectual capital, 2) the relationship between corporate governance mechanisms and non-financial disclosure of intellectual capital. The sample consisted of 312 firm-year observations from 2015 to 2019. They were selected by companies listed on the Market for Alternative Investment of Thailand and the data were collected from financial statements, annual reports, notes to financial statements, the SET Market Analysis and Reporting Tool, and the website of the Securities and Exchange Commission of Thailand. This study measured corporate governance mechanisms consisting of independent directors, audit committee, and top five shareholders. Intellectual capital measured financial and non-financial disclosure. The data were analyzed using statistical regression methods with panel data analysis. The finding reveals that independent directors and audit committees have a significant positive association with the financial disclosure of intellectual capital, while the top five shareholders have a significant negative association with the non-financial disclosure of intellectual capital. The results confirmed the agency theory that corporate governance mechanisms can increase the monitoring of managers' behavior and mitigate conflicts of interest between owners and managers. Furthermore, the study highlighted the significant role of corporate governance mechanisms in managing and utilizing intellectual capital for stakeholders of companies listed on the alternative capital market in Thailand.
Article Details
This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.
Views and opinions appearing in the Journal it is the responsibility of the author of the article, and does not constitute the view and responsibility of the editorial team.
References
Abeysekera, I., & Guthrie, J. (2005). An empirical investigation of annual reporting trends of intellectual capital in Sri Lanka. Critical Perspectives on accounting, 16(3), 151-163. https://doi.org/10.1016/S1045-2354(03)00059-5
Alfraih, M. M. (2018). The role of corporate governance in intellectual capital disclosure. International Journal of Ethics and Systems, 34(1), 101-121. https://doi.org/10.1108/IJOES02-2017-0026
Appuhami, R., & Bhuyan, M. (2015). Examining the influence of corporate governance on intellectual capital efficiency: Evidence from top service firms in Australia. Managerial Auditing Journal, 30(4/5), 347-372. https://doi.org/10.1108/MAJ-04-2014-1022
Bozzolan, S., Favotto, F., & Ricceri, F. (2003). Italian annual intellectual capital disclosure. Journal of Intellectual capital, 4(4), 543-558. https://doi.org/10.1108/14691930310504554
Buallay, A. (2018). Audit committee characteristics: an empirical investigation of the contribution to intellectual capital efficiency, Measuring Business Excellence, 22(2), 183-200. https://doi.org/10.1108/MBE-09-2017-0064
Buallay, A., & Hamdan, A. (2019). The relationship between corporate governance and intellectual capital: The moderating role of firm size. International Journal of Law and Management, 61(2), 384-401. https://doi.org/10.1108/IJLMA-02-2018-0033
Dashtbayaz, M. L., Salehi, M., Mirzaei, A., & Nazaridavaji, H. (2020). The impact of corporate governance on intellectual capitals efficiency in Iran. International Journal of Islamic and Middle Eastern Finance and Management, 13(4), 749-766. https://doi.org/10.1108/ IMEFM-11-2017-0291
Dalwai, T., & Mohammadi, S. S. (2020). Intellectual capital and corporate governance: an evaluation of Oman's financial sector companies. Journal of Intellectual Capital, 21(6), 1469-1930. https://doi.org/10.1108/JIC-09-2018-0151
Dumay, J., & Cai, L. (2015). Using content analysis as a research methodology for investigating intellectual capital disclosure: A critique. Journal of Intellectual Capital, 16(1), 121-155. https://doi.org/10.1108/JIC-04-2014-0043
Fama, E. F., & Jensen, M. C. (1983). Separation of ownership and control. Journal of Law & Economics, 26(2), 301-326.
Gujarati, D. N., & Porter, D. C. (2009). Basic Econometrics. (5th ed.). McGraw-Hill.
Hair, J. F., Black, W. C., Babin, B. J., Anderson, R. E., & Tatham, R. L. (2010). Multivariate data analysis (7th ed.).Pearson Education.
Haji, A. A., & Ghazali, N. A. M. (2013). A longitudinal examination of intellectual capital disclosures and corporate governance attributes in Malaysia. Asian Review of Accounting, 21(1), 27-52. https://doi.org/10.1108/13217341311316931
Hatane, S. E., Wijaya, A. T., William, A., & Haryanto, A. D. (2018). Factors affecting intellectual capital disclosures: a case of primary sectors in Thailand. Journal of Economics and Business, 1(4), 513-523.
Hidalgo, R. L., García-Meca, E., & Martínez, I. (2011). Corporate governance and intellectual capital disclosure. Journal of business ethics, 100(3), 483-495.
Jensen, M., & Meckling, W. (1976). Theory of the firm: Management behavior, agency costs and capital structure. Journal of financial economics, 3(4), 305-360.
Kamath, B. (2017). Determinants of intellectual capital disclosure: evidence from India. Journal of Financial Reporting and Accounting, 15(3), 367-391. https://doi.org/10.1108/JFRA-01-2016-0003
Li, J., Mangena, M., & Pike, R. (2012). The effect of audit committee characteristics on intellectual capital disclosure. The British Accounting Review, 44(2), 98-110.
Li, J., Pike, R., & Haniffa, R. (2008). Intellectual capital disclosure and corporate governance structure in UK firms. Accounting and business research, 38(2), 137-159. https://doi.org/10.1080/00014788. 2008.9663326
Madi, H. K., Ishak, Z., & Manaf, N. A. A. (2014). The impact of audit committee characteristics on corporate voluntary disclosure. Procedia-social and behavioral sciences, 164, 486-492. https://doi.org/10.1016/j.sbspro.2014.11.106
Mohd-Saleh, N., & Che Abdul Rahman, M. R. (2009). Ownership structure and intellectual capital performance in Malaysia. Asian Academy of Management Journal of Accounting and Finance, 5(1), 1-29.
Muttakin, M. B., Khan, A., & Belal, A. R. (2015). Intellectual capital disclosures and corporate governance: An empirical examination. Advances in accounting, 31(2), 219-227. https://doi.org/10.1016/j.adiac.2015.09.002
Park, H. M. (2011). Practical guides to panel data modeling: a step-by-step analysis using Stata. Public Management and Policy Analysis Program. http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.739.5228&rep=rep1&type=pdf
Piriyakul, M. (2016). Panel Data Analysis. Ramkhamhaeng Research Journal of Science and Technology, 30(2), 41–54.
Pulic, A. (2000). VAIC™ an accounting tool for IC management. International Journal of Technology Management, 20(5-8), 702–714. https://doi.org/10.1504/IJTM.2000.002891
Samaha, K., Khlif, H., & Hussainey, K. (2015). The impact of board and audit committee characteristics on voluntary disclosure: A meta-analysis. Journal of International Accounting, Auditing, and Taxation, 24, 13-28. https://doi.org/10.1016/j.intaccaudtax.2014.11.001
Shahveisi, F., Khairollahi, F., & Alipour, M. (2017). Does ownership structure matter for corporate intellectual capital performance? An empirical test in the Iranian context. Eurasian Business Review, 7(1), 67-91.
Suttipun, M. (2018). Association between Board Composition and Intellectual Capital Disclosure: An Evidence from Thailand. Journal of business Administration, 41(160), 74-97.
The Securities and Exchange Commission of Thailand (SEC). (2017). Corporate Governance Code for Listed Companies 2017. https://www.sec.or.th/cgthailand/TH/Documents/Regulation /CGCode.pdf
Tran, N. P., Van, L. T. H., & Vo, D. H. (2020). The nexus between corporate governance and intellectual capital in Vietnam. Journal of Asia Business Studies, 14(5), 637-650. https://doi.org/10.1108/JABS-01-2020-0007
Ulum, I., Ghozali, I., & Purwanto, A. (2014). Intellectual capital performance of Indonesian banking sector: A modified VAIC (M-VAIC) perspective. International Journal of Finance & Accounting, 6(2), 103-123. https://doi.org/10.5296/ajfa.v6i2.5246
Veltri, S., & Mazzotta, R. (2016). The association of board composition, intellectual capital and firm performance in a high ownership concentration context: evidence from Italy. International Journal of Business and Management, 11(10), 317-331. https://doi.org/10.5539/ijbm.v11n10p317
Vetchagool, W. (2022). Board Diversity and Intellectual Capital: An Analysis of Thai Listed Agriculture and Food Companies. KKBS Journal of Business Administration and Accountancy, 6(2), 130-150.
Watts, R. L., & Zimmerman, J. L. (1983). Agency problems, auditing, and the theory of the firm: Some evidence. The Journal of Law and Economics, 26(3), 613-633.
Yallwe, A. H., & Buscemi, A. (2014). An era of intangible assets. Journal of Applied Finance and Banking, 4(5), 17-26.