Board Characteristics and Intellectual Capital Disclosures: Evidence from Sri Lanka

Abstract

Purpose: The purpose of this study is two-fold. First, to examine the state of intellectual capital disclosures. Second, to investigate the relationship between board characteristics and intellectual capital disclosures.Design: This study selected thirty non-financial listed companies with the highest market capitalization from the Colombo Stock Exchange in Sri Lanka. An intellectual capital disclosure index comprising 61 items was developed to understand the level of intellectual capital disclosure in the selected companies. Panel data analysis techniques were applied to test the proposed hypotheses.Findings: Results indicated that role duality and proportion of female directors have a significant and positive impact on intellectual capital disclosures. Firm leverage was found to have a significant and negative effect on intellectual capital disclosures. Insufficient empirical evidence between other corporate board characteristics and intellectual capital disclosure in Sri Lanka may be attributed to a non-mandatory corporate disclosure environment.Originality: This is among the few studies to examine the link between corporate governance and intellectual capital disclosures employing panel data in Sri Lanka. However, a discourse on the role of corporate governance and corporate disclosures is warranted in a small island developing economy with a fragile financial system like Sri Lanka.Future Research Directions -The study calls for more studies to investigate the relationship between corporate governance and intellectual capital disclosures in the case of Sri Lanka by employing data from different industries for longer periods.

Impact of Board Diversity on Voluntary Disclosure of Intellectual Capital: Evidence from Listed Non-Financial Services Firms in Nigeria

“…This finding is in line with those of Tejedo-Romero et al (2017), Alfraih (2018) and Dey et al (2019). However, it is in contrast to those of Bhattacharjee et al, (2017), Nurlis (2017), Chandraratne et al (2021) andHesnati (2021).…”

“…The finding is in line with those of Abeysekra (2010), Kusumawardani et al (2021) andHesnati (2021). This finding, however, contradicts those of Rahman et al, (2019) and Chandraratne et al (2021).…”

“…Using content analysis to analyze the extent of ICD and a pooled cross-sectional regression method to find the determinants of ICD, the study revealed that board size had no significant impact on ICD. Similarly, Chandraratne et al (2021) found that board size had no significant impact on ICD of thirty non-financial listed companies from the Colombo Stock Exchange in Sri Lanka during the period 2019. Given the foregoing, the following hypothesis is proposed:…”

“…The result showed that independent directors on the board had no significant impact on ICD. Using data from annual reports of thirty nonfinancial listed companies from the Colombo Stock Exchange in Sri Lanka during the period 2019, Chandraratne et al (2021) found that board independence had no significant impact on ICD. Similarly, Hesniati (2021) found that independent commissioner composition had no effect on intellectual capital disclosure of 48 Indonesian listed companies.…”

Board diversity and intellectual capital disclosure in listed firms in Nigeria: The moderating role of ownership concentration

“…The date of a company's incorporation may be important in determining how disclosures differ. The number of years passed since incorporation is used to measure this (Barde, 2009;Damayanti and Budiyanawati, 2009;Widiatmoko et al, 2020;Chandraratne et al, 2021).…”