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Family involvement and dividend policy in listed and non-listed firms

Author

Listed:
  • González, Maximiliano

    (School of Management, Universidad de Los Andes)

  • Guzmán, Alexander

    (CESA)

  • Pombo, Carlos

    (School of Management, Universidad de Los Andes)

  • Trujillo, María Andréa

    (CESA)

Abstract

We evaluate the relationship between family involvement, the likelihood of dividend payment, and the amountsof the dividends paid. Using a detailed database of 523 mostly non–listed Colombian companies (1996 to 2006), we found that majority family ownership has significant negative effects on the likelihood of dividend payment. Furthermore, family control through pyramidal structures significantly reduces the level of payouts.In addition, family involvement on the board positively and significantly increases the likelihood of dividend payment, even when the CEO is a member of the founding family. The presence of the founder has a negative, though weakly significant impact on the dividend payments made by firms. debt levels.

Suggested Citation

  • González, Maximiliano & Guzmán, Alexander & Pombo, Carlos & Trujillo, María Andréa, 2012. "Family involvement and dividend policy in listed and non-listed firms," Galeras. Working Papers Series 034, Universidad de Los Andes. Facultad de Administración. School of Management.
    • Handle: RePEc:uac:somwps:034
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    References listed on IDEAS

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    Cited by:

    1. González, Maximiliano & Garay, Urbi & Rosso, John, 2014. "The cost of equity in emerging markets: The case of Latin America," Galeras. Working Papers Series 038, Universidad de Los Andes. Facultad de Administración. School of Management.

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    More about this item

    Keywords

    Family businesses; dividend policy; Agency;
    All these keywords.

    JEL classification:

    • G3 - Financial Economics - - Corporate Finance and Governance
    • G35 - Financial Economics - - Corporate Finance and Governance - - - Payout Policy

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