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Effect Of Corporate Governance Index On Dividend Policy: An Investigation Of Textile Industry Of Pakistan

Author

Listed:
  • Tahir, Safdar Husain

    (Assistant Professor, Banking and Finance Government College University Faisalabad, Pakistan)

  • Sohail , Sara

    (MS-Scholar Department of Banking & Finance, Government College University Faisalabad, Pakistan)

  • Qayyam, Irtaza

    (MS-Scholar Department of Banking & Finance, Government College University Faisalabad, Pakistan)

  • Mumtaz, Komal

    (MS-Scholar Department of Banking & Finance, Government College University Faisalabad, Pakistan)

Abstract

This study observed empirically the impact of corporate governance index on dividend payout policy by using the data of seventeen textile firms listed in Karachi Stock Exchange. The data covered the five years period from 2009 to 2013. The data were gathered from financial statements of all the sample firms. Multiple regression models were used to check the impact of corporate governance on dividend policy. No effect of corporate governance index on firm dividend policy was found, and the largest shareholders also had no impact on dividend pay-out policy. The association between payout policy and stock value was found to be significant positive. Gross profit margin and operating profit margin had significant positive impact on firm’s dividend payout policy. There is a significant correlation between firm performance and payout policy

Suggested Citation

  • Tahir, Safdar Husain & Sohail , Sara & Qayyam, Irtaza & Mumtaz, Komal, 2016. "Effect Of Corporate Governance Index On Dividend Policy: An Investigation Of Textile Industry Of Pakistan," Journal of Economic and Social Development, Clinical Journals Press, vol. 3(01), pages 01-08, March.
    • Handle: RePEc:ris:joeasd:0155
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    References listed on IDEAS

    as
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    2. Easterbrook, Frank H, 1984. "Two Agency-Cost Explanations of Dividends," American Economic Review, American Economic Association, vol. 74(4), pages 650-659, September.
    3. Almeida, Heitor & Park, Sang Yong & Subrahmanyam, Marti G. & Wolfenzon, Daniel, 2011. "The structure and formation of business groups: Evidence from Korean chaebols," Journal of Financial Economics, Elsevier, vol. 99(2), pages 447-475, February.
    4. Larry H. P. Lang & Mara Faccio & Leslie Young, 2001. "Dividends and Expropriation," American Economic Review, American Economic Association, vol. 91(1), pages 54-78, March.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Corporate Governance index; Dividend Policy; Textile Industry; Largest Shareholders; Multiple Regression Model;
    All these keywords.

    JEL classification:

    • A11 - General Economics and Teaching - - General Economics - - - Role of Economics; Role of Economists

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