Dividend Policy in Firms Listed at the Nairobi Securities Market: Does Shareholder Activism Matter?

Abstract

IntroductionDividend policy ranks among critical financial decisions that impact firms' financial performance. It is defined as a policy employed by a company to structure dividend payments, a dividend policy relates to the amount of cash to be distributed among shareholders (Baker & Weigand, 2015). Therefore, the dividend policy seeks to balance the maximization of shareholders' wealth and the growth of finance projects within the firm. Viewed this way, dividend policy represents a crucial strategic financial decision that needs the involvement of shareholders.Dividend policy has gained prominence in influencing the financial performance of firms. Its trend is mired with controversy regarding the factors contributing to its distribution and measurement. The firms listed on the Nairobi securities exchange have mixed financial results under the same economic conditions (