Can Intellectual Capital be a Matter for Corporate Performance? Evidence From Zain Group

Abstract

This study analyses the association between the financial performance of Zain Group ,as one of a leading mobile telecommunications provider in the Middle East and North Africa, and intellectual capital (IC) through 15 years from (1999 to 2013). The study has adopted three factors for IC as a first set of variables. They are structural capital (SC), customer capital (CC) and human capital (HC), and two variables for corporate performance (CORP) as the second set of the study. First one is earnings before interest, tax, depreciation and amortization (EBITDA) and the other is net profit (Nprofit). The findings of the study highlight the components of IC on Zain Group and their impact on CORP. The canonical correlation analysis shows an association between IC, that is most influenced by SC followed by CC, and CORP that is most influenced by Nprofit. In conclusion, the results suggest that both SC and CC have a significant impact on CORP when measured by Nprofit. In contrast, HC has no significant impact on CORP.