Dividend Payouts and Shareholder Structure: Evidence from the Warsaw Stock Exchange

Aluchna, Maria; Berent, Tomasz; Kamiński, Bogumił

doi:10.1080/00128775.2019.1568196

Cited by 12 publications

(12 citation statements)

References 109 publications

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“…Agency conflict between the majority and minority shareholders could elicit a negative market reaction and decrease company value if majority shareholders enjoy private benefits as a result of their control (Faisal et al 2020). The largest shareholders that adversely affect dividend payout could negatively affect the perception of minority shareholders and discourage them from participating on the stock exchange, in turn affecting market liquidity and company value (Aluchna, Berent & Kamiński 2019). The interaction between high ownership concentration, agency conflict, payout, and company value is illustrated in Figure 1.…”

Section: Literature Reviewmentioning

confidence: 99%

“…Global findings with respect to the association between ownership concentration and payout policies predominantly provide support for the rent extraction hypothesis rather than the monitoring hypothesis. Large shareholders have been found to be associated with lower dividend payout, with only a limited number of studies showing a positive association between ownership concentration and dividend payout (Aluchna et al 2019). Empirical evidence in support of the rent extraction hypothesis has been submitted from the context of both developed (Harada & Nguyen 2011;Mancinelli & Ozkan 2006) and developing countries (Besim & Adaoglu 2018;Faisal et al 2020;Gonzalez et al 2017;Thanatawee 2013).…”

Section: Ownership Concentration and Payout Policiesmentioning

confidence: 99%

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The association between ownership concentration and payout behaviour: Evidence from South Africa

2021

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Orientation: The study investigated the association between ownership concentration and different payout methods of selected companies listed on the Johannesburg Stock Exchange (JSE) in South Africa for the financial reporting periods 2012 to 2019.Research purpose: The research objective was to investigate whether payout behaviour differed when low and high ownership concentration was compared.Motivation for the study: An understanding of the association between ownership concentration and payout policies is an important corporate governance aspect that could reveal the agency conflict between majority and minority shareholders. No previous South African empirical study has considered testing or investigating the two opposing agency-based hypotheses, namely the monitoring and rent extraction hypotheses, with reference to different payout methods.Research design, approach, and method: An empirical research design was followed, which is descriptive in nature. Descriptive statistics and a mixed-model analysis of variance were employed to describe the different payout methods – that is ordinary dividends, special dividends, capital distributions, additional shares, general share repurchases, and specific share repurchases – employed by companies listed on the JSE based on a distinction between low and high ownership concentration.Main findings: High ownership concentration was found to be associated with statistically significant lower ordinary dividends and capital distributions in support of the rent extraction hypothesis. Rent extraction highlights the agency conflict between majority and minority shareholders.Practical/managerial implications: Findings of the present study revealed agency conflicts that may be informative to those charged with corporate governance to help them resolve agency conflict.Contribution/value-add: This study is the first to consider the association between ownership concentration and payout behaviour in South Africa subsequent to the introduction of the dividends tax regime in 2012. The descriptive evidence submitted can serve as a basis for further explanatory research relating to ownership concentration and payout behaviour of companies.

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Section: Literature Reviewmentioning

confidence: 99%

Section: Ownership Concentration and Payout Policiesmentioning

confidence: 99%

The association between ownership concentration and payout behaviour: Evidence from South Africa

2021

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“…This is supported by the research of Truong andHeaney (2007, in Aluchna et al, 2019) which found that among other majority shareholders, financial institutions have the least participation in the abuse of company policy through dividends. Therefore, financial institutions can mitigate agency conflicts and actively demand shareholder policies (Aluchna et al, 2019). This realizes the research hypothesis as follows.…”

Section: The Effect Of Controlling Share Ownership By Institution On Dividend Policymentioning

confidence: 61%

“…The ability of controlling institutional shareholders to improve the company's dividend policy is also supported by several studies such as Chang et al (2016); Aluchna et al (2019); Sindhu et al (2016); Renneboog and Szilagyi (2015) who found that institutional shareholders can reduce agency problems by using dividends as a monitoring tool. The presence of institutional shareholders in the company can change management attitudes with their expertise in the financial sector so that companies avoid opportunistic behavior and can protect minority shareholders with dividend payments (Miko & Kamardin, 2015;Djebali & Belanes, 2015;Sindhu et al, 2016).…”

Section: The Effect Of Controlling Share Ownership By Institution On Dividend Policymentioning

confidence: 87%

“…In addition to the large proportion of ownership, the majority share ownership structure can be grouped according to their identity (Aluchna et al, 2019;Thomsen & Pedersen, 2000). Different motivations and perspectives of shareholders can be reflected in the company's strategy in determining profit targets, dividends, capital structure, or growth rates.…”

Section: Ownership Structurementioning

confidence: 99%

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Do Family and Institutional Ownerships Influence the Corporate Dividend Policy?

Santoso¹,

Salim²,

Pranoto³

et al. 2021

EQU

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The difference of interests among shareholders that is dominated by controlling shareholders enlarges the possibility of deprivation towards the minority shareholders' rights. Therefore, a dividend is considered as a tool to reduce conflict of interests between both parties with the assurance of pro-rata distribution of the company's resources. Family and institutional ownerships have unique characteristics that are frequently found in Indonesian firms. Thus, this study intended to analyze the impact of controlling ownership owned by family and institution to dividend policy in nonfinancial firms listed in Bursa Efek Indonesia (BEI) during 2013-2017. The samples are chosen with the purposive sampling method resulting in 373 firms and 1.484 observations obtained. The data used in this study was secondary data from firms' annual and financial reports along with data extracted from Capital IQ. According to the regression results using the fixed-effect model, this study confirms the negative impact of controlling ownership owned by families towards firms' dividend policy. Whilst, controlling ownership owned by institutions shows that it has no significant impact on dividend policy. Otherwise, profitability, size, and leverages are proven to impact firms' dividend policy. However, growth indicates no significant impact.

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Equity ownership concentration’s impact on corporate internal control: the moderating effects of female directors and board compensation

Ong,

Zhou,

Teh

et al. 2023

Environ Dev Sustain

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By promoting diversity in equity ownership concentration, strengthening female representation on boards, aligning pay with sustainability goals, and implementing strong internal control processes, companies can integrate sustainable practices into their operations, improve their sustainability performance, and attain long-term environmental and societal health. Therefore, this study examined the relationship between ownership concentration and internal control through the sustainability lens, specifically focusing on the moderating effects of female directors and board compensation. Data from a sample of 1609 A-share listed businesses in Shanghai and Shenzhen between 2012 and 2021 were analyzed. The findings from the fixed effects model revealed the following: ownership concentration negatively affects internal control; the number of female directors positively influences internal control; female directors actively moderate the relationship between ownership concentration and internal control; and board compensation enhances the effectiveness of internal control. These insights provide valuable data for businesses to enhance their internal control systems, appoint key personnel, and advance their sustainability goals. This study suggests that linking board characteristics to corporate internal control can lead to strengthened sustainable objectives. It also incentivizes directors to prioritize and integrate sustainability concerns in their decision-making. Furthermore, by ensuring that compensation reflects sustainability performance, firms can cultivate a sustainability-based culture and drive effective internal controls that support sustainable practices, ultimately contributing to long-term environmental and social well-being.

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Dividend Payouts and Shareholder Structure: Evidence from the Warsaw Stock Exchange

Cited by 12 publications

References 109 publications

The association between ownership concentration and payout behaviour: Evidence from South Africa

The association between ownership concentration and payout behaviour: Evidence from South Africa

Do Family and Institutional Ownerships Influence the Corporate Dividend Policy?

Equity ownership concentration’s impact on corporate internal control: the moderating effects of female directors and board compensation

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