Determinants of intellectual capital disclosure of financial institutions in an emerging economy

This study aims to examine determinants of intellectual capital disclosures of financial institutions in an emerging economy. The study constructs an intellectual capital disclosure index (ICDI) based on the disclosure of intellectual capital information in the annual reports of 53 listed financial institutions in Bangladesh. The study applies both parametric and non-parametric tests to examine the relationship of different company characteristics with ICDI. Results suggest that profitability and riskiness of firms are important determinants of intellectual capital disclosures. These findings support regulators and policy makers for deepening their understanding about the intellectual capital disclosure strategy of financial institutions. This study also contributes to the theoretical understanding of intellectual capital reporting by highlighting limitations of agency theory in explaining the relationship between different company characteristics and intellectual capital disclosure in the context of financial institutions of Bangladesh.