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The impact of abolishing shareholder perks on dividend policy: Evidence from Japan

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  • Matsuura, Yoshiaki

Abstract

Shareholder perk (yutai) programs are a distinctive feature of the Japanese equity market; however, recent abolitions raise an important question regarding cash substitution. Complementing prior valuation studies by examining realized payouts of Japanese firms, this study evaluates competing corporate-governance views. Using a matched event-time difference-in-differences (DiD) design for Japanese firms, the results show that dividend outflows are higher for firms that abolish their yutai programs and that these increases strengthen over time. Dividend on Equity (DOE) is also higher. Diagnostics are consistent with parallel trends, and the results are robust to winsorization. Payout-channel evidence indicates that firms adjust to the abolition of their yutai programs primarily through dividends rather than repurchases. Overall, the findings are consistent with the efficient-substitution hypothesis, indicating that firms replace in-kind benefits with more transparent cash-based shareholder returns.

Suggested Citation

  • Matsuura, Yoshiaki, 2026. "The impact of abolishing shareholder perks on dividend policy: Evidence from Japan," Finance Research Letters, Elsevier, vol. 100(C).
    • Handle: RePEc:eee:finlet:v:100:y:2026:i:c:s1544612326001753
    DOI: 10.1016/j.frl.2026.109644
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    Keywords

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    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • G35 - Financial Economics - - Corporate Finance and Governance - - - Payout Policy

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