Intellectual capital disclosure and corporate governance structure in UK firms

TLDR

The study examines how intellectual capital disclosure relates to corporate governance variables in 100 UK listed firms, assessing the influence of governance on human, structural, and relational capital disclosure. Intellectual capital disclosure is quantified using a disclosure index score, word count, and percentage of word count, while governance variables include board composition, ownership structure, audit committee size and meeting frequency, and CEO role duality. Results show significant associations between intellectual capital disclosure and all governance factors except CEO role duality. Keywords: intellectual capital disclosure, corporate governance; correspondence: Professor Richard Pike, University of Bradford.

Abstract

Abstract This paper investigates the relationship between intellectual capital disclosure and corporate governance variables, controlling for other firm‐specific characteristics, for a sample of 100 UK listed firms. Intellectual capital disclosure is measured by a disclosure index score, supported by word count and percentage of word count metrics to assess the variety, volume and focus of intellectual capital disclosure respectively. The independent variables comprise various forms of corporate governance structure: board composition, ownership structure, audit committee size and frequency of audit committee meetings, and CEO role duality. Results of the analysis based on the three measures of intellectual capital disclosure indicate significant association with all the governance factors except for role duality. The influence of corporate governance mechanisms on human, structural and relational capital disclosure, based on all three metrics, is also explored. Keywords:: intellectual capital disclosurecorporate governancecontent analysisannual report Notes The authors are at the University of Bradford. They wish to thank Musa Mangena, the anonymous reviewers and the editor for their helpful comments. Correspondence should be addressed to: Professor Richard Pike, University of Bradford, School of Management, Emm Lane, Bradford, UK, BD9 4JL. E‐mail: [e-mail]