Sikalidis, A, Bozos, K orcid.org/0000-0003-2914-6495, Chantziaras, A et al. (1 more author) (2022) Influences of family ownership on dividend policy under mandatory dividend rules. Review of Quantitative Finance and Accounting, 59 (3). pp. 939-967. ISSN 0924-865X
Abstract
We explore the relationship between family ownership and dividend policy in an insider financial system under mandatory dividend rules. In a civil law insider institutional setting like ours, the concentration of management control in the hands of family members in combination with poor corporate governance makes the expropriation of minorities more likely for high levels of family ownership leading potentially to lower dividend payouts. We theorize on the competing effects of the alignment and entrenchment hypotheses of family control and how the dividend supply and demand mechanisms explain dividend payout decisions. We empirically demonstrate a U-shaped relationship between dividends and family ownership- akin to previously documented dividend patterns across Anglo-American firms- in line with the alignment effects on the supply of dividends and the entrenchment effects on the demand of dividends. Meanwhile, high levels of family ownership increase the likelihood that the mandatory (minimum) dividend requirement is waived. Investment opportunities and the firm’s risk profile moderate the shape and strength of the above relationships.
Metadata
Item Type: | Article |
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Authors/Creators: |
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Copyright, Publisher and Additional Information: | © 2022, The Author(s). This is an author produced version of an article published in Review of Quantitative Finance and Accounting. Uploaded in accordance with the publisher's self-archiving policy. |
Keywords: | Family firms; Dividends; Payout policy; Mandatory dividend |
Dates: |
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Institution: | The University of Leeds |
Academic Units: | The University of Leeds > Faculty of Business (Leeds) > Accounting & Finance Division (LUBS) (Leeds) |
Depositing User: | Symplectic Publications |
Date Deposited: | 16 May 2022 10:50 |
Last Modified: | 11 May 2023 00:13 |
Status: | Published |
Publisher: | Springer |
Identification Number: | 10.1007/s11156-022-01064-w |
Open Archives Initiative ID (OAI ID): | oai:eprints.whiterose.ac.uk:186829 |