Chapter 2 Literature review

• DOI: https://doi.org/10.1108/S1479-3512(2011)0000021010
• Date: 31 December 2010
• Published date: 31 December 2010
• Pages: 17-24
• Author: Indra Abeysekera

CHAPTER 2

LITERATURE REVIEW

2.1. INTRODUCTION

This chapter provides a review of the literature relating to intellectual capital

and f‌irm performance in the context of corporate reputation. Section 2.2

outlines the def‌initions of intellectual capital and how they differ from the

def‌initions offered for intangibles by accounting regulators. Section 2.3

reviews the categorisation of intellectual capital and looks at two major

models of categorisation. Section 2.4 examines the def‌inition of intellectual

capital disclosure. Section 2.5 examines f‌irm performance from the view-

point of f‌irm reputation for value-relevant disclosure. Section 2.6 discusses

f‌irm reputation in the context of intellectual capital disclosure. Section 2.7

provides a summary of the chapter.

2.2. DEFINING INTELLECTUAL CAPITAL

At times, intellectual capital has been def‌ined in the literature as capturing

all intangibles, regardless of whether or not they are separately identif‌iable

and controllable by f‌irms (Edvinsson & Sullivan, 1996;Sveiby, 1989, 1997).

As noted by Petty and Guthrie (2000), the literature offers a number of

def‌initions of intellectual capital. In some def‌initions, intellectual assets are

considered synonymous with intellectual capital, whereas others take the

view that intellectual capital comprises intellectual assets and intellectual

liabilities (Abeysekera, 2003;Caddy, 2000). Most of the def‌initions support

the idea that benef‌its from intellectual capital are not necessarily

immediately identif‌iable but are rather accrued over the long term (ASCPA

and CMA, 1999;Knight, 1999;CMA, 1998;Edvinsson & Malone, 1998;

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