As noted by Royal and O’Donnell (2008), in a knowledge economy, it is essential for analysts of listed companies to systematically articulate the drivers of intangible value within listed firms. This paper draws on the same principles and applies them to the level of dialogue between financial markets representatives and company officers of listed companies. Using primary data from a European Biotechnology Conference in London, in which company representatives presented forecasts to financial markets analysts, the author classifies the level of dialogue between Boards and markets at relatively low levels on the Bloom (1956) and Baker- Brown (1992) taxonomies, and, notes the absence of dialogue on drivers of value, including human capital. Frameworks developed by Wood and Bandura (1989) on social cognitive theory are useful in exploring reasons why the level of Board/market dialogue may not be at the most sophisticated levels of cognitive complexity. As initiatives such as the United Nations Principles for Responsible Investment (UNPRI) create pressures on financial market analysts to be increasingly aware of non-financial drivers of value, there will be increasing opportunities for Boards and markets to develop dialogue at higher levels of cognitive complexity. Over time, new technologies may help to enhance this dialogue.
|Keywords:||Cognitive Complexity, Board and Market Dialogue, Biotechnology|
Lecturer, Australian School of Business, University of New South Wales, Sydney, NSW, Australia
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