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    Do corporate governance mechanisms affect cash dividends? An empirical investigation of UK firms

    Al-Najjar, Basil and Belghitar, Y. (2014) Do corporate governance mechanisms affect cash dividends? An empirical investigation of UK firms. International Review of Applied Economics 28 (4), pp. 524-538. ISSN 0269-2171.

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    Abstract

    The study examines whether corporate governance mechanisms and the compliance with good governance practice are related to cash dividends. In particular, the study assesses the effect of institutional ownership and board structure on the decision to pay cash dividends. A study on UK firms is interesting because firms are expected to voluntarily structure governance mechanisms based on their own needs. We find that institutional owners positively affect cash dividend payments, suggesting that UK institutions are effective in forcing firms to disgorge cash. There is limited evidence that independent directors affect the cash dividends. The results also show that firm specifics affect the cash dividends, namely, business risk, firm size, and leverage ratio. The results are consistent across several robustness checks.

    Metadata

    Item Type: Article
    Keyword(s) / Subject(s): audit committee, audit meetings, independent auditors, non-executive directors, institutional ownership, cash dividends
    School: Birkbeck Schools and Departments > School of Business, Economics & Informatics > Management
    Depositing User: Administrator
    Date Deposited: 31 Oct 2014 13:46
    Last Modified: 31 Oct 2014 13:46
    URI: http://eprints.bbk.ac.uk/id/eprint/10861

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