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Dividend Policy in Malaysia: A Comparison of Determinants Pre and Post Malaysian Code on Corporate Governance

This study was aimed at examining the differences between dividend policy determinants pre- and post-Malaysian Code on Corporate Governance (MCCG) 2012. Several factors, including profitability, lagged dividend, free cash flow, debt, firm size, investment opportunities and market risk were tested. T...

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Main Authors: Bakri, Mohd Ashari, Abd Jalil, Mohamad Isa, Hassan, Zakiah
Format: Article
Language:English
Published: UUM Press 2021
Subjects:
HG Finance
Online Access:https://repo.uum.edu.my/id/eprint/29215/1/IJBF%2016%2002%202021%201-22.pdf
https://repo.uum.edu.my/id/eprint/29215/
https://doi.org/10.32890/ijbf2021.16.2.1
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spelling my.uum.repo.292152023-03-05T08:37:10Z https://repo.uum.edu.my/id/eprint/29215/ Dividend Policy in Malaysia: A Comparison of Determinants Pre and Post Malaysian Code on Corporate Governance Bakri, Mohd Ashari Abd Jalil, Mohamad Isa Hassan, Zakiah HG Finance This study was aimed at examining the differences between dividend policy determinants pre- and post-Malaysian Code on Corporate Governance (MCCG) 2012. Several factors, including profitability, lagged dividend, free cash flow, debt, firm size, investment opportunities and market risk were tested. The study investigated a total number of 631 non-financial firms in Malaysia that covered 7830 firm-year observations from 2005 to 2011 (pre-MCCG) and from 2013 to 2019 (post-MCCG). The study used pooled Ordinary Least Square (OLS) and random and fixed effect, with a robust standard error. The results demonstrated that from seven factors tested only four factors were found to be significant in determining dividend policy in pre-MCCG, and five factors in post MCCG. The pre-MCCG test revealed that before the revised MCCG 2012, the factors determining dividend policy were as follows: profitability, lagged dividend, debt, and firm size. However, there were slight changes in the range of determinants affecting dividend policy, Post-MCCG 2012. The post MCCG test revealed that profitability, lagged of dividend, and firm size consistently determined firm dividend policy; however, debt was no longer a significant determinant of dividend policy post MCCG. Additionally, investment opportunity and market risk were found to be significant determinants of dividend policy post-MCCG in 2012. UUM Press 2021 Article PeerReviewed application/pdf en cc4_by https://repo.uum.edu.my/id/eprint/29215/1/IJBF%2016%2002%202021%201-22.pdf Bakri, Mohd Ashari and Abd Jalil, Mohamad Isa and Hassan, Zakiah (2021) Dividend Policy in Malaysia: A Comparison of Determinants Pre and Post Malaysian Code on Corporate Governance. International Journal of Banking and Finance (IJBF), 16 (2). pp. 1-22. ISSN 2590-423X https://doi.org/10.32890/ijbf2021.16.2.1
institution Universiti Utara Malaysia
building UUM Library
collection Institutional Repository
continent Asia
country Malaysia
content_provider Universiti Utara Malaysia
content_source UUM Institutional Repository
url_provider http://repo.uum.edu.my/
language English
topic HG Finance
spellingShingle HG Finance
Bakri, Mohd Ashari
Abd Jalil, Mohamad Isa
Hassan, Zakiah
Dividend Policy in Malaysia: A Comparison of Determinants Pre and Post Malaysian Code on Corporate Governance
description This study was aimed at examining the differences between dividend policy determinants pre- and post-Malaysian Code on Corporate Governance (MCCG) 2012. Several factors, including profitability, lagged dividend, free cash flow, debt, firm size, investment opportunities and market risk were tested. The study investigated a total number of 631 non-financial firms in Malaysia that covered 7830 firm-year observations from 2005 to 2011 (pre-MCCG) and from 2013 to 2019 (post-MCCG). The study used pooled Ordinary Least Square (OLS) and random and fixed effect, with a robust standard error. The results demonstrated that from seven factors tested only four factors were found to be significant in determining dividend policy in pre-MCCG, and five factors in post MCCG. The pre-MCCG test revealed that before the revised MCCG 2012, the factors determining dividend policy were as follows: profitability, lagged dividend, debt, and firm size. However, there were slight changes in the range of determinants affecting dividend policy, Post-MCCG 2012. The post MCCG test revealed that profitability, lagged of dividend, and firm size consistently determined firm dividend policy; however, debt was no longer a significant determinant of dividend policy post MCCG. Additionally, investment opportunity and market risk were found to be significant determinants of dividend policy post-MCCG in 2012.
format Article
author Bakri, Mohd Ashari
Abd Jalil, Mohamad Isa
Hassan, Zakiah
author_facet Bakri, Mohd Ashari
Abd Jalil, Mohamad Isa
Hassan, Zakiah
author_sort Bakri, Mohd Ashari
title Dividend Policy in Malaysia: A Comparison of Determinants Pre and Post Malaysian Code on Corporate Governance
title_short Dividend Policy in Malaysia: A Comparison of Determinants Pre and Post Malaysian Code on Corporate Governance
title_full Dividend Policy in Malaysia: A Comparison of Determinants Pre and Post Malaysian Code on Corporate Governance
title_fullStr Dividend Policy in Malaysia: A Comparison of Determinants Pre and Post Malaysian Code on Corporate Governance
title_full_unstemmed Dividend Policy in Malaysia: A Comparison of Determinants Pre and Post Malaysian Code on Corporate Governance
title_sort dividend policy in malaysia: a comparison of determinants pre and post malaysian code on corporate governance
publisher UUM Press
publishDate 2021
url https://repo.uum.edu.my/id/eprint/29215/1/IJBF%2016%2002%202021%201-22.pdf
https://repo.uum.edu.my/id/eprint/29215/
https://doi.org/10.32890/ijbf2021.16.2.1
_version_ 1759692232993013760
score 13.211869

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