Tobin Q as a proxy variable of IC has been used in both continuous and categorical
variables within the framework of direct and indirect tests. We structured categorical
variable into two groups:
1. firms that have Tobin Q ratio lower than 1; and
2. firms that have Tobin Q higher than 1.
The logic behind this categorization is that a higher value of Tobin Q may reflect positive
signals in terms of intellectual capital. Table V demonstrates descriptive statistics about
Tobin Q with respect to firms’ unsystematic factors within the analysis period. It is observed
that there are more firms taking a higher value of Tobin Q over the threshold value than
those of having lower value except for 2008 in which 89 and 45 firms take a lower and a
higher value, respectively. It is aimed to test whether there are statistically significant
differences based on the categorization of IC with respect to CG, CSR and firms’
unsystematic factors.