The relationship between intellectual capital and financial performance: an application on small and medium-sized businesses

This study investigates the impact of intellectual capital on financial performance. The sample comprises annual data from 2012 to 2023 for companies listed on the BIST SME Industry Index. Two models were constructed in the study. In the first model, return on assets was the dependent variable, while structural capital efficiency, human capital efficiency, capital employed efficiency, market capitalization, and leverage ratio were independent variables. In the second model of the study, market value was the dependent variable, and structural capital efficiency, human capital efficiency, capital employed efficiency, leverage ratio, and return on assets were the independent variables. The study found a statistically significant positive relationship between return on assets, firms’ market values, and capital efficiency. There was also a statistically significant negative relationship between human capital efficiency and the leverage ratio. Firms’ market values were positively related to return on assets and structural capital efficiency. In contrast, the relationship between firms’ market values and capital efficiency was significant and negative.