The purpose of this paper is to empirically investigate the effects of corporate governance on the dividend payout in Australia where dividend payout remains high and the corporate governance system has been strengthened. Design/methodology/approach: A self-constructed governance index from 2001 to 2013 is used to test the effect of corporate governance on dividend payouts. Two versions of the indexes, and the traditionally emphasized governance elements, such as board structure, are also used for the robustness checks. A random effect panel Tobit model is employed to test the factors influencing dividend payout decision. Findings: Estimation results report a positive effect of governance, combined with firm size and profitability, on dividend payouts. In contrast, financial distress and the GFC have a negative effect on dividend policy. Finding of further examinations imply that the positive effect of governance is attenuated by growth opportunities, while intensified by the franked dividend. Originality/value: In this paper, the sample period and the governance index, respectively, are the longest and the most comprehensive among existing studies in the case of Australia. This paper also combined the traditional governance-dividend theme with corporate tax, particularly the unique franked dividend tax system.

Using a sample of publicly listed firm in Korea from 2002 to 2006, this article examines the impact of board monitoring on firm value and productivity. We use outsider's attendance of board meetings as a proxy for board monitoring. Consistent with the commitment hypothesis, we find that outsider's attendance rate increases firm value, suggesting that attending board meeting itself is a strong signal that reflects outsider's intention to monitor insiders. While ownership of controlling shareholders negatively affects firm value, this relationship is not moderated by increased monitoring by outsiders. Our findings provide further evidence that the outside director system is less effective in chaebol-affiliated firms. Results also indicate that the effect of outsider's board monitoring activity on investor's valuation of the firm is greater than on productivity improvement of the firm. Our conclusions are robust for possible endogeneity in the relationship between firm value and board attendance by outside directors.

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