Impact of intellectual capital on productivity of insurance companies in Ghana

Abstract

Purpose The purpose of this paper is to empirically investigate the effect of intellectual capital (IC) efficiency on changes in the productivity of insurance companies in Ghana. Design/methodology/approach Using a panel of 33 insurance companies from 2008 to 2016, the study applied Value Added Intellectual Coefficients model as a measure of IC efficiency, whilst Malmquist Productivity Index is employed to capture changes in the productivity of insurance companies. In estimating the effects of IC on productivity, System Generalised Method of Moment (GMM) is applied because of its power over endogeneity and heteroscedasticity. Findings Robust empirical findings on productivity analysis showed that improvements in insurer’s productivity were experienced in three year intervals out of the overall studied year. In addition, panel regression results revealed that IC along with human capital and capital employed significantly affect the productivity of insurance companies. Research limitations/implications The generalisability of the study findings could be questioned because it is limited to insurance firms operating in Ghana; some firms were omitted due to mergers and acquisition that reduced the final sample. Yet, the findings facilitate the validation of IC concept and, hence, informs manager/policy makers on IC utilisation as a source of competitive edge. Practical implications Having robust empirical findings, the study expands on the existing literature by unveiling the dynamic nature of IC relationship and productivity. The findings also serve as a benchmark for managers/policymakers in insurance companies to increase the operational efficiency by investing in IC, which will help guarantee improve returns on generated premiums. Originality/value Although a few studies have investigated the effect of IC in Ghana, this study is the first to examine the dynamic relationship between IC and changes in productivity in a Ghanaian context.

Intellectual capital and financial performance of South African development community’s general insurance companies

“…Previous studies such as those by Sardo and Serrasqueiro (2017), Xu and Wang (2018), Buallay (2019), Rahayu and Ramadhanti (2019), Barbosa et al (2016), Bontis et al (2018), Ozkan et al (2017) and Scafarto et al (2016) have established substantial affiliation between components of Intellectual Capital as well as organisational performance in various sectors such as banks, agribusiness, tourism, health, manufacturing, social cooperative enterprise, automobile industry, public companies, higher education, social cooperatives etc. While there are few studies on the insurance sector in this context, scholars such as Asare et al (2017) and Oppong et al (2019) have conducted studies on Intellectual Capital and insurance sector performance in some African countries.…”

Do Intellectual Capital Elements Spur Firm Performance? Evidence from the Textile and Apparel Industry in China

“…Nowadays, managing and upgrading knowledge resources determine the success of any organization [1][2][3]. In the knowledge economy, intellectual capital (IC) as an intangible resource can help a firm to generate economic returns and build competitive advantage along with tangibles [4][5][6][7][8].…”

Pengaruh Human Capital Terhadap Economic Value Added Pada Sektor Umkm Di Provinsi Bali

“…Penelitian dari Oppong et al (2019) Penelitian dari Parham dan Heling (2015) mengumpulkan data pada 33 perusahaan produksi Belanda dari tahun 2007 hingga 2012 untuk mengukur pengaruh efisiensi modal manusia terhadap kinerja perusahaan. Temuan penelitian ini menunjukkan hubungan positif antara efisiensi sumber daya manusia dan ketiga ukuran kinerja perusahaan (ROA, ROE, dan produktivitas karyawan).…”

“…Komponen human capital seperti Knowhow, pendidikan, keterampilan kerja, pengetahuan terkait pekerjaan, keterampilan profesional dan kewirausahaan dapat berpotensi sebagai antesedem dalam penciptaan nilai perusahaan dan akan tercermin dalam kinerja keuangan dan keberlangsungan dari sektor UMKM itu sendiri. Penelitian ini mengkonfirmasi penelitian dari Česynienė and Stankevičienė (2011); Beattie and Smith (2010); Guthrie and Petty (2007); Brennan (2001) dan Bozzolan (2008); Oppong et al (2019); Smriti and Das (2018); Hoang et al (2018); Rahim et al (2017); Kwarbai and Akinpelu (2016); Parham dan Heling (2015).…”