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This study aims to explore the financial implications of intellectual capital in the Jordanian financial sector during the period 2009–2018. It uses Pulic’s (2004) value-added intellectual capital model, particularly capital employed efficiency, structural capital efficiency, and human capital efficiency, and tests its potential effect on firm financial performance measures, including return on assets, return on equity, asset utilization ratio, and Tobin’s Q. The study’s findings demonstrate that value-added intellectual capital positively influences the financial performance of Jordanian financial companies. Value-added intellectual capital is not found to have a significant impact on productivity, but it is strongly and positively related to firm profitability and market value. As for the main components of value-added intellectual capital, human capital efficiency has a significantly positive impact on a company’s performance, but regarding structural capital efficiency, the outcomes vary depending on the measure of firm performance. Notably, when firms are categorized into sub-industries (banks, insurance companies, and financial service companies), it is found that the profitability of insurance companies is more affected by intellectual capital than that of banks or financial services. The results also show that investors place great importance on the efficiency of intellectual capital, particularly within the banking industry. Furthermore, implementing Shariah compliance standards boosts the positive effect of structural capital efficiency on corporate market value and reinforces the positive influence of human capital efficiency on productivity.
Mustafa et al. (Mon,) studied this question.