The Impact of Intellectual Capital and Good Corporate Governance on Bank Value with the Mediating Effect of Financial Performance: Evidence from Iran

Saeed Dehghan Khavari, Seyed Hossein Mirjalili and Mostafa Esmaeili

EconStor Open Access Articles and Book Chapters, 2024, vol. 19, issue 1, 23 pages

Abstract: The value of a company is important to shareholders, investors, managers, creditors, and other stakeholders in their assessment of the company's future, its impact on the estimation of investment risk and returns, and stock prices. Therefore, examining the factors affecting a company's value is crucial. Intellectual capital, as a determinant in creating competitive advantage and value, plays a special role and is considered as an intangible asset of companies. Theoretical background and empirical evidence suggest that intellectual capital directly influences a company’s value and performance. Moreover, the need for corporate governance arises from the potential conflict of interest between individuals within the company's structure, which can affect its value. As banks’ shares play an important role in the Tehran Stock Exchange, we examine the impact of intellectual capital and good corporate governance on bank value, with the mediating effect of financial performance. The statistical population of this study includes 17 banks listed on the Tehran Stock Exchange over the period from 2017 to 2021. The results indicated that intellectual capital significantly affects, in contrast to corporate governance, which does not have a significant effect on bank value. Additionally, financial performance mediating the link between intellectual capital and bank value is accepted based on the Baron and Kenny (1986) method for mediation. The findings also show that the mediating effect of financial performance on the relationship between good corporate governance and bank value is confirmed according to the Zhao et al., 2010 procedure. Moreover, the results indicated that adding Good Corporate Governance as another independent variable relatively increases the explanatory power of the model.

Keywords: Intellectual Capital; Good Corporate Governance; Financial Performance; Bank Value; Tehran Stock Exchange (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:espost:327721

DOI: 10.29252/jme.16.1.1

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