Is Share Ownership a Condition for the Voluntary Revelation of Human Capital?: Empiric Evidence From Mexican Trades

Is Share Ownership a Condition for the Voluntary Revelation of Human Capital?: Empiric Evidence From Mexican Trades

Ruth Leticia Hidalgo, Amada Hidalgo, Miguel Ángel Oropeza, Eleazar Villegas, Sofía Elizabeth Ávila
Copyright: © 2020 |Pages: 16
DOI: 10.4018/IJCFA.2020070102
OnDemand:
(Individual Articles)
Available
$37.50
No Current Special Offers
TOTAL SAVINGS: $37.50

Abstract

Previous studies affirm the importance of intellectual capital (IC) for organizations, since they acquire value and make them more competitive in the market. In this context, the empirical evidence shows that the key ingredient classification of IC is human capital (HC). The purpose of this study is to know what kind of Mexican companies listed are those that voluntarily disclose the HC, as to date there is no evidence of this information. That is why the authors consider a sample of 875 annual reports, corresponding to 85 Mexican listed firms during the period 2005-2015. These samples reveal that the largest companies in terms of number of employees, belonging to the construction and textile sectors, and shares are held by the family, and they are most likely to disclose aspects of HC. Thus, the authors determine that items occupying the top positions relate to the experiences as managers and employees as well as training and development, just as the information unless disclosed refers to the opportunity for career advancement and quality life at work.
Article Preview
Top

Introduction

Accountancy has been the ideal channel of communication among users of financial information since it reveals the largest amount of possible information to the timely and accurate decision making. Over time, national and international organizations such as the CINIF and IASB have issued standards and criteria generally applicable to present and disclose financial information satisfying needs that users demand, including those intangible elements potentially creators of value (Gomez and Maldonado, 2012, pp.65-83).

IC in today's “knowledge era” is an important intangible asset representing a competitive advantage What a difference and determines the value of the firm organizations (Barney, 1991, pp. 99-120), The latter is the result of the interaction of two capital, financial including physical and monetary assets and intellectual encompasses those processes and invisible assets of the company (Flores, 2001).

Another definition of IC is established by Sánchez, Melián and Hormiga (2007), who recognize it as the combination of immaterial or intangible assets such as: employee’s knowledge, capacity to learn and to adapt, relations with customers and suppliers, brands, names of the products, internal processes, and research and development of an organization.

Nevertheless, the IC due to its particular characteristics, has been set aside by the accountancy rules, even when the NIF C-8 intangible assets exist, however, the IC is not considered as an asset because of its valuation and measurement difficulties (Ramírez, 2007, pp. 18-29). This limitation implies that the presented information on the financial statements does not reflect the true value of the economic entity and, hence, the information is not enough for decision making.

Therefore, the difficulty of the current accounting model and the demand for greater information supply, has led to use of media such as presentations and private voluntary disclosure through internet (Gomez and Maldonado, 2012), thus contributing to the decision-making of users. Benefits voluntary disclosure information includes, among many others; to increase the manager’s credibility, to improve the corporate image and, definitely, to improve the investment decisions (Ruíz, 2016). In this way it is provided transparency to the organization practices.

Similarly, the permanent disclosure practice is better known on listed companies in the different markets of the capitals of the world (Sader and Ficco, 2014, pp. 1-14), since they are required to provide additional information due to the measures imposed by authorities who regulate the stock market.

In this regard, the HC is the cornerstone on the knowledge era (Madrigal, 2009, pp. 65-81), and makes reference to education, experience, knowledge, skills, values and attitudes of the people working in the company (Tejedo and Ferraz, 2016, pp.125-144).). Each competition is an individual and non-transferable asset and cannot be owned by the company, but other elements nourish and give life to the production process within the company (Osorio, 2016). As workers increase their knowledge will grow its potential (Velázquez, 2007, pp. 81-90).

Complete Article List

Search this Journal:
Reset
Volume 11: 1 Issue (2024): Forthcoming, Available for Pre-Order
Volume 10: 1 Issue (2023)
Volume 9: 2 Issues (2022): 1 Released, 1 Forthcoming
Volume 8: 2 Issues (2021)
Volume 7: 2 Issues (2020)
Volume 6: 2 Issues (2019)
Volume 5: 2 Issues (2018)
Volume 4: 2 Issues (2017)
Volume 3: 2 Issues (2016)
Volume 2: 2 Issues (2015)
Volume 1: 2 Issues (2014)
View Complete Journal Contents Listing