The Impact of Ownership Structure on Dividend Policy the Evidence from Saudi Arabia
جاري التحميل...
التاريخ
المؤلفين
عنوان الدورية
ردمد الدورية
عنوان المجلد
الناشر
Journal of Emerging Issues in Economics, Finance and Banking
خلاصة
This study investigates the role of ownership structure in determining corporate dividend policy listed in Saudi Arabia Stock Market. Relying on insights from agency, opportunism assumption and stakeholder theories, this study draws from these strands of the literature, supplemented by the implications of the Saudi context, to identify potential ownership structure that might affect the dividend policy. A sample of 100 Saudi listed corporations from 2012 to 2015 has been considered. Unlike our prediction, our results indicate that shareholding by management represents a positive coefficient. The presence of a high managerial ownership promote an opportunistic behavior of managers which arouses a high levels of dividends to control this behavior. It has been argued that the firm’s dividend policy has an important part to play in curtailing agency costs arising from the conflicts between the firm’s stakeholders. Our results also show the existence of a negative correlation between family ownership and the level of dividend distribution. The result supports the agency and expropriation hypothesis. However, our evidence suggests that the increasing ownership of Saudi institutional investors reduces in general the need for high dividend payouts, which may be due to their efficient monitoring on the firms’ management. These investors prefer to retain the funds and reinvest them into projects as opposed to distribute them.