The Moderating Role of Sustainability Disclosure on the Relationship between Intellectual Capital and Firm Performance

Abstract

The purposes of this research were to study the relationship between intellectual capital and firm performance, and the relationship between intellectual capital and firm performance which was moderated by sustainability disclosure. The accounting firm's performance was measured by return on assets (ROA), and the market firm's performance was measured by Tobin's Q. Sustainability data were collected according to GRI Standards. The intellectual capital was measured by value-added intellectual capital (VAIC). The sample included 185 firms from three industries; agriculture and food, technology, and service industry listed on the Stock Exchange of Thailand from 2018 to 2020. The results showed that intellectual capital had a positive relationship with accounting performance and market performance. When the moderating role of sustainability disclosure was examined, it was found that sustainability disclosure positively moderated the relationship of value-added intellectual capital (VAICTM) on market performance (Tobin’s Q) at a significance level of .05. The results showed that intellectual capital influenced firm performance and enhanced firm efficiency, particularly when firms paid attention to sustainability disclosure.