What firm’s characteristics drive the dividend policy? A mixed-method study on the Euronext stock exchange

Barros, Victor; Matos, Pedro

doi:10.1016/j.jbusres.2019.11.042

Cited by 55 publications

(42 citation statements)

References 41 publications

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“…The individual components track the overall trend, although the governance score exhibits higher relative variability and is positioned at lower levels. We focus on the payment and stability of dividends, following the works of Barros et al [53] and Barros et al [54]. The payment of dividend (Dividend) takes the value 1 for dividend-paying firms i in year t, and 0 otherwise.…”

Section: Methodsmentioning

confidence: 99%

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Does ESG Affect the Stability of Dividend Policies in Europe?

2020

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Sustainability has become a significant issue for firms and investors throughout the world, although it cannot be attained if policies impact the stability of firms’ dividend policies. In this paper, we use data from the Stoxx Euro 600 firms from 2000 to 2019 and the ESG (environmental, social and governance) scores from Thomson Reuters to assess the relationship between ESG responsibility performances and the firm’s dividend policy. The results indicate that more sustainable firms exhibit a more stable dividend payout. This result is also valid when the ESG pillars are analysed, specifically, the environmental and governance pillars. The findings further suggest that higher ESG scores reveal better long-term alignment with shareholders and other stakeholders due to more proportionally stable profit sharing.

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Section: Methodsmentioning

confidence: 99%

“…The ESG is the score for each firm i in year t, either the ESG score or the score for each sub index. Control variables are drawn from existing empirical evidence: Firms' effective tax rate (ETR), which is a traditional topic in the dividend policy literature (for instance [53,[58][59][60][61]); -…”

Section: Methodsmentioning

confidence: 99%

Does ESG Affect the Stability of Dividend Policies in Europe?

2020

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“…Decision making about the dividend policy often affects the share price (Barros et al, 2019). Kraft et al (2013) and Anderson & Reeb (2003) indicate that companies that pay dividends have an abnormal return than the company that does not.…”

Section: The Effect Of Dividend Policy On Firm Valuementioning

confidence: 99%

“…Studies that test the influence of the dividend policy against the firm value still have not demonstrated consistent results. Barros et al (2019) said that the discussion about this policy dividend is controversial. Some argue that a policy dividend is relevant to firm value, but on the other hand, the agency theory claims that both things are relevant.…”

Section: The Effect Of Dividend Policy On Firm Valuementioning

confidence: 99%

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The Role of Capital Structure on The Effect of Dividend Policy and Business Risk on Firm Value (Evidence from Indonesian Manufacturing Company)

Irawati

Komariyah

2019

The Indonesian Journal of Accounting Research

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This study examines the effect of dividend policy and business risk on firm value and capital structure. Moreover, this study analyzes the role of capital structure in that relationship simultaneously. The relationship between these variables has been a debate in the capital market literature. Using manufacturing companies listed on Indonesia Stock Exchange (IDX) for years 2012-2018, this study takes into account that the dividend policy and business risk do not directly impact the firm value. Thus, we examine 41 companies that meet the sample criteria. The result shows that dividend policy and business risk have a positive effect both on firm value and capital structure. Then, capital structure has a role in mediating the effect of dividend policy, and business risk on firm value has been confirmed.

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The impact of environmental, social and governance (ESG) score on dividend payment of large family firms: What is the role of financial constraints? International evidence

Maquieira,

Espinosa‐Méndez,

Arias

2023

Corp Soc Responsibility Env

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This article studies the relationship between environmental, social and governance (ESG) score and dividend payment for 274 large family firms in the period 2015–2021. This research has three contributions to the literature. First, to the best of our knowledge this is the first article to focus on large family firms considering their greater importance in stock ownership around the world. Second, this sample covers both developed and emerging nations. Third, our study not only establishes a connection between ESG (Environmental, Social, and Governance) criteria and dividend payments but also considers how financial constraints moderate the relationship between ESG scores and dividend payments. The results indicate a positive influence of ESG scores on dividend payments. Furthermore, financial constraints of family firms are negatively related to dividend payments. Finally, the moderating effect of financial constraints on the relationship between dividend payment and ESG show that for high levels of financial constraints that dividends are less sensitive to ESG score. The opposite effect is reported when firms show low levels of financial constraints. Practically speaking, the study demonstrates the value of creating a dividend policy that is in line with the ESG score because they are complementary signals. Additionally, it is important to consider financial limitations when planning financial reserves in family firms. This is due to the diminished correlation between ESG score and dividend payments in the presence of financial constraints.

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What firm’s characteristics drive the dividend policy? A mixed-method study on the Euronext stock exchange

Cited by 55 publications

References 41 publications

Does ESG Affect the Stability of Dividend Policies in Europe?

Does ESG Affect the Stability of Dividend Policies in Europe?

The Role of Capital Structure on The Effect of Dividend Policy and Business Risk on Firm Value (Evidence from Indonesian Manufacturing Company)

The impact of environmental, social and governance (ESG) score on dividend payment of large family firms: What is the role of financial constraints? International evidence

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