Abstract

The purpose of this study is to investigate empirically the effect of intellectual capital (IC) on high IC firm financial performance with moderating role of dynamic capability (DC). The period covered is from 2000 to 2011. Secondary data were collected from financial statements of high IC firms of Malaysia (technology sector, consumer products sector, trading and service sector, and industrial products) obtained from their websites. Regression models were developed to test the relationship among firm financial performance and IC. The analysis findings indicate that, the impact of IC on firm financial performance increases when DC is included as moderator. In addition, there is positive and significant relationship between humane capital efficiency (HCE), structural capital efficiency (SCE), and capital employed efficiency (CEE) with firm financial performance.

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