Intellectual capital and firm performance in the global agribusiness industry: The moderating role of human capital

Purpose The main objective of this paper is to investigate the relationship between intellectual capital (IC), categorized in terms of four sub-constructs – namely human, relation, innovation and process capital – and business performance in the agribusiness industry. Design/methodology/approach Based on a sample of international agribusiness companies observed over a five-year period, this paper uses correlation and multiple regression analysis to test for the existence of a positive relationship between each IC component and conventional business performance metrics. Findings The empirical results support the hypotheses that relation and process capital have a positive impact on corporate performance. Counter to our expectations, innovation capital by itself is negatively asssociated with performance. Results also failed to confirm the hypothesis that human capital directly and positively affects performance. However human capital positively moderates the relation between innovation capital and performance, which suggests that firms that heavily invest in human capital are better placed to gain returns from their R&D investments. Originality/value This study expands the existing research on the link between intellectual capital and performance by adding fresh evidence from a highly knowledge-intensive sector which has been under-researched thus far. It may also contribute to the specific literature on R&D and performance as it uncovers that the value-generating effect associated with R&D investments is contingent on the levels of human capital.