Intellectual Capital Disclosure: Evidence from the Italian Systemically Important Banks

Intellectual Capital Disclosure: Some Evidence from Healthy and Distressed Banks in Italy

“…We defined the framework according to studies using a detailed intellectual capital framework; in particular, we followed four models: two models on the IC disclosure of European banks [6,9]; one model on the IC reporting of Italian listed firms, including banks [24]; and a model specifically developed for Italian banks [12].…”

“…Moreover, we defined a new detailed intellectual capital framework for banks on the basis of some frameworks provided by literature [6,9,12,24]. Additionally, our study provided evidence that Italian banks do not attribute sufficient importance to IC disclosure in general, and in particular, they do not consider such issues a strategic asset for improving their credibility and reputation.…”

“…For example, in the case of distressed intermediaries, we found a higher positive variation of the values of the items related to the recruitment of skilled personnel and the enhancement of the use of social media, maybe considered key factors. On the other hand, the healthy banks presented a slight tendency to disclose forward-looking information, maybe due to the fact that they were more focused Sustainability 2020, 12, 3174 3 of 20 on the strategies as opposed to a more short-term approach of the distressed banks. To complement our study on healthy and distressed banks, we repeated the analysis focusing on bank size and independent directors.…”

“…For this, it may relate to elements such as image, customer loyalty and satisfaction, and environmental activities [9].It is therefore clear how the IC could be enhanced within a knowledge-based scenario, taking into account that only a profitable knowledge management, aimed at achieving the best benefit of stakeholders, may represent a significant driver of the companies' success [9]; this is particularly significant in the case of banks, as "perfect" representatives of a knowledge-based economy. Thus, IC is essential in the banking activity [6]: banks are considered knowledge-intensive institutions, due to a business model highly focused on individual knowledge workers, great use of technology, and the interaction between employees and customers [10][11][12].The centrality of knowledge in the banking sector explains, moreover, the need for an increase in the transparency of IC information, especially in times of financial crisis, and, therefore, of general lack of belief in banks' reliability. Truly, in this respect, existing literature shows different empirical evidence: some studies find that IC disclosure increases in crisis periods, since it is considered a tool for improving reputation and credibility according to social expectations (e.g., [13]); other research reveals that firms do not enrich their IC reporting during a crisis, probably in order to limit the costs and to adopt more conservative behaviors (e.g., [14]).…”

“…It is therefore clear how the IC could be enhanced within a knowledge-based scenario, taking into account that only a profitable knowledge management, aimed at achieving the best benefit of stakeholders, may represent a significant driver of the companies' success [9]; this is particularly significant in the case of banks, as "perfect" representatives of a knowledge-based economy. Thus, IC is essential in the banking activity [6]: banks are considered knowledge-intensive institutions, due to a business model highly focused on individual knowledge workers, great use of technology, and the interaction between employees and customers [10][11][12].…”