The impact of intellectual capital on financial performance: Empirical evidence of listed firms on Hochiminh Stock Exchange

ased slightly compared to the same period in 2015. The mean of value added intellectual capital (VAIC) is 5.89 and the significant difference between observations (standard deviation is 7.3) is due to the fact that the use of knowledge capital in different occupations is different. The highest VAIC value is 55.92 which is 60 points higher than the low value of -6.06 7. Results: Table 2: Result of Model Regression Pooled OLS FEM REM VAIC 0, 001945 (0,000) 0,0073067 (0,000) 0,0040895 (0,000) LEV -0, 1409431 (0,000) -0,0815974 (0,003) -0,1148767 (0,000) SIZE -0, 0073891 (0,222) -0, 0393118 (0,022) -0, 0204516 (0,012) GROWTH -0, 0027545 (0,503) 0,0046984 (0,120) 0,0033699 (0,260) Observations 537 537 537 164 Pooled OLS FEM REM Adj R-squared R-squared: within between overall 0,2337 0,2733 0,1338 0,1480 0,2474 0,2071 0,2048 Breusch-Pagan LM Test Chi2(7) = 1067.746 P-value = 3.e-226 Hausman Chi2(6) = 88.02 Prob>chi2 = 0,0000 xttest3/xttest0 Chi2 (179) = 6.7e+08 Prob>chi2 = 0,0000 Source: Author’s Statistics Firstly, the relationship between human capital efficiency (HCE) and financial performance is the positive. To specify, β1 = 0.0041928 shows that when human capital efficiency increases by 1 unit, the financial efficiency increases by 0.004 units and this result is statistically significant at the level of 5%. This confirms the hypothesis H1: The effectiveness of human capital has a positive effect on the financial performance of enterprises listed on the Ho Chi Minh City Stock Exchange Period 2014 - 2017. This result supports the views of Chen et al. (2005) and Dyna Seng (2010), but is different from study of Firer and Williams (2003) in their African market studies. They stated there is no relationship between HCE and ROA. Knowing how to use and improve the quality of human resources is one of the keys to the success of a business, especially those in the non- manufacturing sector. Machinery may be outdated but human capacity will develop if it is working in a good environment. Secondly, the efficiency of capital structure has the same effect on the return on assets and this result is statistically significant with P-value = 0.005. The regression coefficient 0.0186891 indicates that when SCE increases by 1, the ROA increases by 0.019. This confirms the H2 hypothesis: The effect of structured capital has a positive effect on the financial performance of listed firms on the Ho Chi Minh City Stock Exchange The period 2014 - 2017, similar to Hong Kong's experimental evidence of Chan (2009b). In contrast to this conclusion, Shiu (2006b) and Ting and Lean (2009) point to the negative relationship of the efficiency of using structured capital to the return on assets. Structured capital represents the core values of the internal machinery of an enterprise. An economic organization that builds its foundations for a firm corporate culture will gain many advantages in the business process and will stand up to difficulties in different contexts of the economy. Thirdly, capital employed efficiency has the same effect and among the three factors of VAIC, this factor has the strongest impact on ROA. With β3 = 0.2364238, when the 165 capital efficiency increased by 1 unit, the financial performance increased by 0.236 units. This is consistent with the empirical evidence of Dyna Seng (2010), which shows a similar correlation between these two factors. However, with a significance level of 5%, this result is not statistically significant, which means that the H3c hypothesis: The capital employed effieciency has a positive effect on the financial performance of listed firms on the Hochiminh Stock Exchange is not supported. Considering the significance level of 5%, the effective use of structured capital (SCE) has the strongest impact on the financial performance of enterprises. This result is different from the study by Ting and Lean (2009) and Singh and Narwal (2016), showing that CEE is the most powerful component of ROA, followed by HCE and SCE respectively. It can be seen that when referring to this intangible capital in Vietnam, enterprises use the resources of the organization as corporate culture or management system more efficiently than using the resources of each individual in the company. This implies that enterprises listed on the Hochiminh Stock Exchange do not have appropriate human resource management methods to enhance the qualities such as creativity, dynamism or individual satisfaction. Finally, in this model, the LEV variable has the same effect on ROA, the SIZE variable has a negative effect on ROA. However, the control variables remaining GROWTH is not significant with a level of 5%. 8. Discussion and Conclusion Firstly, in order to increase the knowledge of investors about knowledge capital, enterprises need to disclose information about the knowledge capital of their own units, except for elements that need to be kept confidential. Abundance of knowledge capital should be reflected in the annual report or other media of the business to investors as well as other stakeholders to create a positive effect on the market value of the business. Information disclosure should emphasize the current benefits and potential growth of that knowledge capital, rather than merely introducing what the company owns. Secondly, for those businesses that have not accumulated much knowledge capital, they need to improve and accumulate capital to increase the value of enterprises in the market as well as catch up the development trend of the economy. The time to build and accumulate capital will be shortened if the company takes advantage of opportunities and learning experiences from its competitors or their predecessors. On the other hand, development needs to be consistent with the structure or characteristics of organizational structure, strategy, scale, process ... requires the building and accumulation of all components in the enterprise, more specifically, human resources. 9. 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