Staff View: The influence of ownership structure on the firms dividend policy based on lintner model / Norhasniza Mohd Hasan Abdullah, Zuraidah Ahmad and Shashazrina Roslan

The influence of ownership structure on the firms dividend policy based on lintner model / Norhasniza Mohd Hasan Abdullah, Zuraidah Ahmad and Shashazrina Roslan

This study investigates the relationship between types of ownership structure and dividend payments of Malaysian listed companies. A cross-sectional analysis of 100 sample firms listed on the main board of Bursa Malaysia for the years 2010 is utilized. The study examines the explanatory power of two...

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Main Authors:	Mohd Hasan Abdullah, Norhasniza, Ahmad, Zuraidah, Roslan, Shashazrina
Format:	Research Reports
Language:	English
Published:	2012
Subjects:	Financial management. Business finance. Corporation finance Dividends. Stock dividends. Dividend reinvestment Malaysia
Online Access:	https://ir.uitm.edu.my/id/eprint/35031/1/35031.PDF https://ir.uitm.edu.my/id/eprint/35031/
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id	my.uitm.ir.35031
record_format	eprints
spelling	my.uitm.ir.350312022-03-09T03:53:18Z https://ir.uitm.edu.my/id/eprint/35031/ The influence of ownership structure on the firms dividend policy based on lintner model / Norhasniza Mohd Hasan Abdullah, Zuraidah Ahmad and Shashazrina Roslan Mohd Hasan Abdullah, Norhasniza Ahmad, Zuraidah Roslan, Shashazrina Financial management. Business finance. Corporation finance Dividends. Stock dividends. Dividend reinvestment Malaysia This study investigates the relationship between types of ownership structure and dividend payments of Malaysian listed companies. A cross-sectional analysis of 100 sample firms listed on the main board of Bursa Malaysia for the years 2010 is utilized. The study examines the explanatory power of two alternative models of dividend policy, the full adjustment model and the partial adjustment model modified which are moderated by the possible effects of five types of ownership structure, namely ownership concentration, ownership dispersion, institutional ownership, managerial ownership and foreign ownership. Ownership concentration is measured by the Herfindahl Index while ownership dispersion is measured by ratio of the number of shareholders to total outstanding shares. Institutional ownership is measured by a percentage of equity owned by institutional investors, while, managerial ownership is measured by adding the total percentage of shares directly held by non independent executive directors in the company, and foreign ownership is measured by the sum of all shares in the hands of foreign shareholders in the list of thirty largest shareholders, either held through nominee companies or other corporate foreign share holdings. Ownership concentration variables are found to be positively and statistically significant in influencing dividends in every type of dividend model. The finding is consistent with agency theory since high dividend payments can be used for mitigating agency conflict as dividends can be substituted for shareholder monitoring. Hence, large shareholders have strong incentives to require higher dividend payments in order to reduce monitoring costs. Nevertheless, this study shows that dividend decisions of Malaysian companies are not influenced by the structure of ownership. 2012 Research Reports NonPeerReviewed text en https://ir.uitm.edu.my/id/eprint/35031/1/35031.PDF ID35031 Mohd Hasan Abdullah, Norhasniza and Ahmad, Zuraidah and Roslan, Shashazrina (2012) The influence of ownership structure on the firms dividend policy based on lintner model / Norhasniza Mohd Hasan Abdullah, Zuraidah Ahmad and Shashazrina Roslan. [Research Reports] (Unpublished)
institution	Universiti Teknologi Mara
building	Tun Abdul Razak Library
collection	Institutional Repository
continent	Asia
country	Malaysia
content_provider	Universiti Teknologi Mara
content_source	UiTM Institutional Repository
url_provider	http://ir.uitm.edu.my/
language	English
topic	Financial management. Business finance. Corporation finance Dividends. Stock dividends. Dividend reinvestment Malaysia
spellingShingle	Financial management. Business finance. Corporation finance Dividends. Stock dividends. Dividend reinvestment Malaysia Mohd Hasan Abdullah, Norhasniza Ahmad, Zuraidah Roslan, Shashazrina The influence of ownership structure on the firms dividend policy based on lintner model / Norhasniza Mohd Hasan Abdullah, Zuraidah Ahmad and Shashazrina Roslan
description	This study investigates the relationship between types of ownership structure and dividend payments of Malaysian listed companies. A cross-sectional analysis of 100 sample firms listed on the main board of Bursa Malaysia for the years 2010 is utilized. The study examines the explanatory power of two alternative models of dividend policy, the full adjustment model and the partial adjustment model modified which are moderated by the possible effects of five types of ownership structure, namely ownership concentration, ownership dispersion, institutional ownership, managerial ownership and foreign ownership. Ownership concentration is measured by the Herfindahl Index while ownership dispersion is measured by ratio of the number of shareholders to total outstanding shares. Institutional ownership is measured by a percentage of equity owned by institutional investors, while, managerial ownership is measured by adding the total percentage of shares directly held by non independent executive directors in the company, and foreign ownership is measured by the sum of all shares in the hands of foreign shareholders in the list of thirty largest shareholders, either held through nominee companies or other corporate foreign share holdings. Ownership concentration variables are found to be positively and statistically significant in influencing dividends in every type of dividend model. The finding is consistent with agency theory since high dividend payments can be used for mitigating agency conflict as dividends can be substituted for shareholder monitoring. Hence, large shareholders have strong incentives to require higher dividend payments in order to reduce monitoring costs. Nevertheless, this study shows that dividend decisions of Malaysian companies are not influenced by the structure of ownership.
format	Research Reports
author	Mohd Hasan Abdullah, Norhasniza Ahmad, Zuraidah Roslan, Shashazrina
author_facet	Mohd Hasan Abdullah, Norhasniza Ahmad, Zuraidah Roslan, Shashazrina
author_sort	Mohd Hasan Abdullah, Norhasniza
title	The influence of ownership structure on the firms dividend policy based on lintner model / Norhasniza Mohd Hasan Abdullah, Zuraidah Ahmad and Shashazrina Roslan
title_short	The influence of ownership structure on the firms dividend policy based on lintner model / Norhasniza Mohd Hasan Abdullah, Zuraidah Ahmad and Shashazrina Roslan
title_full	The influence of ownership structure on the firms dividend policy based on lintner model / Norhasniza Mohd Hasan Abdullah, Zuraidah Ahmad and Shashazrina Roslan
title_fullStr	The influence of ownership structure on the firms dividend policy based on lintner model / Norhasniza Mohd Hasan Abdullah, Zuraidah Ahmad and Shashazrina Roslan
title_full_unstemmed	The influence of ownership structure on the firms dividend policy based on lintner model / Norhasniza Mohd Hasan Abdullah, Zuraidah Ahmad and Shashazrina Roslan
title_sort	influence of ownership structure on the firms dividend policy based on lintner model / norhasniza mohd hasan abdullah, zuraidah ahmad and shashazrina roslan
publishDate	2012
url	https://ir.uitm.edu.my/id/eprint/35031/1/35031.PDF https://ir.uitm.edu.my/id/eprint/35031/
_version_	1728054747533934592
score	13.211869

The influence of ownership structure on the firms dividend policy based on lintner model / Norhasniza Mohd Hasan Abdullah, Zuraidah Ahmad and Shashazrina Roslan

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