The Effect of Intellectual Capital on the Company Value: The Case of Banking Companies in Indonesia

Anita Yesi, Didik Susetyo and Rela Sari
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Anita Yesi: Sriwijaya University, Palembang, Indonesia
Didik Susetyo: Sriwijaya University, Palembang, Indonesia
Rela Sari: Sriwijaya University, Palembang, Indonesia

Oblik i finansi, 2022, issue 2, 124-133

Abstract: The value of the company includes all forms of value that determine its health and well-being in the long run. With the development of innovations, intangible assets and firm's business model became an important component of the company's value. This study aims to determine the effect of intellectual capital on the value of banking companies in Indonesia. The analysis also covers other factors affecting the company's value, namely the company's size and good corporate governance. The object of the study is 43 banking companies in Indonesia whose shares are listed on the Indonesian Stock Exchange. The data for the analysis are taken from the financial reporting forms of companies for 2015-2020, which are published on the website of the Indonesian Stock Exchange (www.idx.co.id) and the companies' websites. The methodological basis of the analysis is panel data regression performed in the EViews program. Company value in this study is measured using the Tobin Q. Intellectual capital is measured based on the added value created by physical capital, human capital and structural capital. Company size is measured using the natural logarithm of total assets. Good corporate governance is measured through managerial ownership, institutional ownership, audit committee and board of commissioners. The study results show that intellectual capital significantly impacts the value of banking companies in Indonesia. In addition, the company's value is also affected by its size and implementation of good corporate governance. The results of the qualitative analysis indicate that intellectual capital affects the business organization in various ways, such as increasing competitive advantage, promoting innovation, increasing employee competence and operational efficiency.

Keywords: company value; intellectual capital; company size; good corporate governance; banking companies (search for similar items in EconPapers)
JEL-codes: G20 G21 O34 (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:iaf:journl:y:2022:i:2:p:124-133

DOI: 10.33146/2307-9878-2022-2(96)-124-133

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