An investigation of intellectual capital disclosure of Malaysian public listed companies

This study investigates intellectual capital disclosure (ICD), with a view to contributing to the understanding of ICD practice. Specifically, this study examines whether there is a relationship between the level of IC disclosure (measured by the intellectual capital disclosure index (ICDI) and intellectual capital word count (ICWC)) and companies' profitability, productivity, firm size, and industry type. A total of 255 annual reports of Malaysian listed companies for the period 2006–2008 were analyzed. Content analysis was applied to determine what and how IC is disclosed. The results of this content analysis confirm those of prior research: ICD is increasing over time, the most reported IC is Human Capital (HC), and firm size is a driver of ICD. However, firms' profitability and productivity are not influenced by ICD. The present study adds to the existing literature by examining the issue of valuing profitability through intellectual capital value.