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The Influence of Government Shareholding on Dividend Policy in Malaysia

Author

Listed:
  • Philip Sinnadurai

    (Independent Researcher, Marsfield, Sydney, NSW 2122, Australia)

  • Ravichandran Subramaniam

    (School of Business, Monash University Malaysia, Jalan Lagoon Selatan, Bandar Sunway, Subang Jaya 47500, Selangor Darul Ehsan, Malaysia)

  • Susela Devi

    (Sunway University Business School, Sunway University, No. 5 Jalan Universiti, Bandar Sunway 47500, Selangor Darul Ehsan, Malaysia)

Abstract

We investigate the association between dividend policy and government shareholding, using Malaysian data. We hypothesize a positive association. We contribute to the literature about dividend policy. Unique features of our study include adaptations to the Malaysian institutional setting, with respect to usage of dividend relevance theory, research methodology, and data collection. The methodology entails two-stage least squares regressions. Dividend payout and dividend yield are the dependent variables in tests of the research hypothesis. The independent variable of interest measures ownership by government-related institutional investors. The sample comprises 1190 company-years, over the investigation period 2006–2013. The results support our hypothesis. The evidence suggests that this support principally emanates from companies with low-quality corporate governance.

Suggested Citation

  • Philip Sinnadurai & Ravichandran Subramaniam & Susela Devi, 2021. "The Influence of Government Shareholding on Dividend Policy in Malaysia," IJFS, MDPI, vol. 9(3), pages 1-29, September.
    • Handle: RePEc:gam:jijfss:v:9:y:2021:i:3:p:49-:d:632588
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    References listed on IDEAS

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    Cited by:

    1. Philip Sinnadurai, 2022. "“Empirical Corporate Finance: Opportunities and Challenges”—Editorial Synthesis of the Special Issue," JRFM, MDPI, vol. 15(9), pages 1-8, August.

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