The intention of this experiential analysis is to explore the stimulus of intellectual capital (IC) on the financial performance of firms itemized in financial sector on Bursa Malaysia Berhad. Scholars regard intellectual capital as a market value creator. In the era of information technology, competitive advantage can only be found through intangible assets (intellectual capital). Nowadays, the factors of production have changed to information and knowledge. Therefore, the execution of Knowledge based Economy (K-economy) is necessary for an improved development and competitiveness. The Malaysian economy of today has changed from a P-economy which stands for production economy to K-economy whereby the knowledge has been the main key driver. Today, in the k-economy, knowledge is known as one of the primary factors in sustaining economic growth apart from land, labour and physical capital. This study measure IC by the value-added Intellectual coefficient measurement model. Most of the scholars regards finance industry as a knowledge-based industry, thus this industry is encompassed. Hence, it generates it a perfect sector for study on intellectual capital. Knowledge based industries are considered as the strength of the new economy called knowledge-based economy. Economists believe financial sector has a major contribution in long term economic growth and development, also the important pillar for economy.
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To cite this article: Saddam, S. Z. (2020). The Motivation of Intellectual Capital on Firm’s Financial Performance: Analysis on Financial Sector in Malaysia., International Journal of Academic Research in Accounting, Finance and Management Sciences 10 (2):195-199.
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