ICD corporate communication and its determinants: evidence from Italian listed companies’ websites

Giuseppe Nicolò,Giuseppe Sannino,Natalia Aversano,Paolo Tartaglia Polcini

doi:10.1108/medar-03-2020-0834

Abstract

PurposeThis study aims to analyse the extent and type of online intellectual capital (IC) disclosure provided by a sample of 117 Italian listed companies. The study also seeks to identify possible determinants of the extent and type of intellectual capital disclosure (ICD) practiced by Italian listed companies via the Web.Design/methodology/approachA content analysis is conducted to investigate the extent and type of online ICD provided through websites by a sample of 117 Italian listed companies. Two multivariate ordinary least squares regression models are applied to estimate the associations proposed in the research hypotheses.FindingsThe results show that Italian listed companies are exploiting the potential of websites to satisfy the information needs of investors and other stakeholders in relation to strategic IC-based corporate resources, with a particular focus on external capital. For the most part, ICD is conveyed in narrative form. Moreover, while the size and board independence positively affect both the extent and type of ICD, profitability exerts a positive influence only on the extent of online ICD.Originality/valueUnlike previous ICD studies, which focussed on annual reports, this study explores an emerging and innovative tool to convey ICD, namely, the website. In today’s world, websites are considered to be the most expedient and effective tools for sharing and transmitting information, including IC; they are a vehicle that can shift the IC focus from the organisation to the wider ecosystem.

Highlights

Disclosing intellectual capital (IC) entails “the revelation of information that was previously secret or unknown” (Dumay, 2016, p. 178)
Scholars advocate that investigating online communication tools is pivotal to gathering relevant insights that will be enhancing the understanding of the level of IC information disclosed by modern organisations beyond the traditional static and backwards-looking financial reports which, for many years, represented the main focus of intellectual capital disclosure (ICD) studies (Lombardi and Dumay, 2017; Massaro et al, 2017; Ndou et al, 2018)
The present study contributes to the literature, providing fresh insight into the extent and type of online ICD communicated by a sample of 117 Italian listed companies

Summary

Introduction

Disclosing intellectual capital (IC) entails “the revelation of information that was previously secret or unknown” (Dumay, 2016, p. 178). The majority of ICD research up to now has focussed on annual reports as a possible data source, showing discouraging results in terms of the actual level of ICD provided by organisations (Cuozzo et al, 2017; Dumay and Guthrie, 2017). This has led to progressive stagnation of ICD research which has yielded increasingly less significant results over the years (Dumay, 2016; Dumay and Guthrie, 2017). Online channels such as websites, whose structure has improved considerably in recent years as a result of digital technological innovations, have been welcomed as a “relevant contributor to IC disclosure [. . .] able to generate massive, variable and valuable amounts of data” (Ndou et al, 2018, p. 500)

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