Intellectual Capital Disclosure and Firm Value: A Comparative Study of Listed Companies in Kenya and South Africa

Abstract

The purpose of the research was to assess the relationship between intellectual capital disclosure and value of listed companies between Kenya and South Africa. The study population was formed of 209 listed companies from which a sample of 137 companies was purposefully selected comprising 19 companies listed in NSE, Kenya and 118 companies were from JSE, South Africa, considered as integrated reporting adopters for the period 2018-2020. On the cornerstone of stakeholder theory, the study employed exploratory and confirmatory research design. Secondary data extracted from audited integrated reports and annual financial statements encompassed the source of research data. Descriptive statistics, correlation and regression methods were used as data analysis methods. The results reveal that the effect of intellectual capital disclosure on firm value is statistically significant. While negative and significant effect was revealed in the case of Kenya, South Africa listed companies data exhibited a positive and significant association. The study recommends that managers in these organizations should embrace intellectual capital disclosures since it has been found to influence firm value. Further, this study adds value to literature on the association between Intellectual capital disclosure and firm value from an integrated reporting context.