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Intellectual capital reporting, leadership and strategic change.

Slack, R. and Matthias, M. (2016) 'Intellectual capital reporting, leadership and strategic change.', Journal of applied accounting research., 17 (1). pp. 61-83.


Purpose A change in leadership can signal a shift in corporate strategy to drive future value creation. To help achieve this, a different emphasis may be placed upon the intellectual capital (IC) resources within the organisation. This research examines the changes in volume, composition and emphasis of IC disclosure in annual reports mapped against the re-orientation of corporate strategy and associated leadership change. Design/methodology/approach A longitudinal period of over three decades (1979 to 2010) is examined. Adopting a case based approach, Daimler AG is purposively selected for this research having a number of distinct changes in strategy over the period, reflective of leadership change. Using content analysis, annual report IC related disclosures (structural, relational and human capital) by Daimler AG are examined, by category and more detailed sub-categories, against corporate strategy. Findings The composition and emphasis of IC disclosures found in the annual reports changes over the longitudinal period and is reflective of the prevailing corporate strategy at that time. There were four identified periods of strategy, each associated with leadership change. The prevalence and qualitative focus of IC disclosures relevant to each period reflects the importance of respective IC components in corporate value creation. Research limitations/implications The research is based on annual report IC disclosures within one case company and hence reflect the messages conveyed by that company over the longitudinal period. Additionally, we recognise that the annual report is only one source of corporate information, but as a historic record it serves to consistently capture management disclosure over a long time period. Future research, adopting an econometric approach, could further test the linkages between leadership change, strategic shift and IC related disclosure. Practical implications The research reveals how IC related disclosure shifts to reflect leadership and strategic change within a case company. Through such disclosure, we are able to gain greater insight into how a specific business seeks to create value drawing on the components of IC underpinning corporate strategy. Originality/value The research provides new insights into IC disclosure by mapping its content and emphasis against changes in corporate strategy. This has contemporary significance due to the wider disclosure debate concerning strategy and value creation in the annual report, for instance through integrated reporting. Further, the research shows the value of annual reports for longitudinal disclosure research.

Item Type:Article
Full text:(AM) Accepted Manuscript
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Publisher statement:This article is © Emerald Group Publishing and permission has been granted for this version to appear here Emerald does not grant permission for this article to be further copied/distributed or hosted elsewhere without the express permission from Emerald Group Publishing Limited.
Date accepted:29 April 2015
Date deposited:08 April 2015
Date of first online publication:22 January 2016
Date first made open access:22 January 2016

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