The Impact of Intellectual Capital of Indonesian's High-Tech Company on Firm’s Financial and Market Performance

AEC (ASEAN Economic Community) enacted in ASEAN since the end of 2015. AEC is expected to improve the ASEAN to be more dynamic and competitive region. In the other hand, AEC may also make the competition between firms inside ASEAN region become increasingly competitive. This condition requires the firm to utilize its resources more effectively and efficiently so that the firm can create value added and compete on the AEC. Indonesia, as a country with the largest economy in the region, needs to address this issue so that the companies in this country can face AEC challenges. This study aims to examine the positive impact of intellectual capital on firm’s financial and market performance of high-tech companies that are listed in Indonesia Stock Exchange. This study conducted with the observation period of 2008-2014. The final sample used in this study consists of 31 companies with the total of 144 observations. This study uses panel data regression model analysis, ie. fixed effect regression and random effect regression. The results showed that intellectual capital has a positive impact on firm’s financial performance. This result indicate that the efficient and effective use of intellectual capital will make the firms able to achieve higher financial performance and will be useful for facing AEC. There’s no evidence to support the impact of intellectual capital on market performance.