Proceedings of The 2nd International Conference on Research in Business, Management and Economics
The Relationship between Intellectual Capital and Company’s Performance: Evidence on Pharmaceutical Sector
Alexandra Ioana Daniela Rus
The aim of this paper is to analyze the relationship between intellectual capital and financial performance of the pharmaceutical companies. The analyze was made on a period consist in 5 years (2013-2018), using the indicators available on the Bucharest Stock Exchange for listed companies. Financial performance was measured through Return on Equity (ROE) and Return on Assets (ROA). The intellectual capital was measured using the directs methods Market Value Added (MVA) and Economic Value Added (EVA). The results were presented in four distinct regressions composed by the indicators mentioned. Firstly, we presented the impact of intellectual capital on company’s performance expressed by the relationship between Logarithmated Evaluated Value Added (LEVA) and Return on Equity, then Market Value Added and Return on Assets. Secondly, it was shown the relationship between Return on Equity and Logarithmated Evaluated Value Added followed by Return on Assets and Market Value Added. Through the results was revealed that there is an impact of intellectual capital on the company’s performance and there is also an impact of company’s performance on the intellectual capital.
Keywords: Economic Value Added, Market Value Added, Return on Assets, Return on Equity.