Version 1
: Received: 28 April 2024 / Approved: 29 April 2024 / Online: 29 April 2024 (05:12:27 CEST)
How to cite:
Sayed, O. A.; Nefzi, A. The Impact of Intellectual Capital on Sustainable Performance: Banking Sector in Saudi Arabia. Preprints2024, 2024041887. https://doi.org/10.20944/preprints202404.1887.v1
Sayed, O. A.; Nefzi, A. The Impact of Intellectual Capital on Sustainable Performance: Banking Sector in Saudi Arabia. Preprints 2024, 2024041887. https://doi.org/10.20944/preprints202404.1887.v1
Sayed, O. A.; Nefzi, A. The Impact of Intellectual Capital on Sustainable Performance: Banking Sector in Saudi Arabia. Preprints2024, 2024041887. https://doi.org/10.20944/preprints202404.1887.v1
APA Style
Sayed, O. A., & Nefzi, A. (2024). The Impact of Intellectual Capital on Sustainable Performance: Banking Sector in Saudi Arabia. Preprints. https://doi.org/10.20944/preprints202404.1887.v1
Chicago/Turabian Style
Sayed, O. A. and Aida Nefzi. 2024 "The Impact of Intellectual Capital on Sustainable Performance: Banking Sector in Saudi Arabia" Preprints. https://doi.org/10.20944/preprints202404.1887.v1
Abstract
This study investigates the impact of intellectual capital on the sustainable performance of banks in Saudi Arabia, focusing on the period from 2012 to 2022. Utilizing data from ten major Saudi banks, the research examines how different components of intellectual capital—Human Capital Efficiency (HCE), Structural Capital Efficiency (SCE), and Capital Employed Efficiency (CEE)—influence key financial performance indicators such as Return on Equity (ROE) and Net Profit Margin (NPM). The study is grounded in the resource-based view of the firm, which suggests that a firm’s internal resources can provide a sustainable competitive advantage. The analysis employs panel data techniques, including fixed and random effects models, to assess the relationships between intellectual capital components and bank performance while controlling for variables like bank size, financial leverage, GDP growth, inflation, and the impact of the COVID-19 pandemic. The findings reveal that intellectual capital significantly enhances bank performance in Saudi Arabia, with human capital efficiency showing the most decisive influence on ROE and NPM. Structural capital and capital employed efficiency also contribute positively but vary in their impact on different performance measures. This research contributes to the theoretical and practical understanding of the role of intellectual capital in promoting sustainable banking practices. It underscores the importance of strategic management of intellectual capital in enhancing financial performance and achieving sustainability goals, particularly in the context of Saudi Arabia's Vision 2030. The study's insights are relevant for bank managers and policymakers who leverage intellectual capital for economic diversification and sustainable development.
Keywords
Intellectual Capital; Sustainable Performance; Saudi Arabian Banks; Human Capital Efficiency; Structural Capital Efficiency; Capital Employed Efficiency
Subject
Business, Economics and Management, Economics
Copyright:
This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
