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The impact of family-CEOs and their demographic characteristics on dividend payouts: Evidence from Latin America

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  • Briano-Turrent, Guadalupe D.C.
  • Li, Mingsheng
  • Peng, Hongfeng

Abstract

We investigate the effect of family-CEOs and CEO demographic characteristics on firms’ dividend policy in Latin America. We show that family-CEO firms pay less amount of dividends and invest more in capital expenditures than nonfamily-CEO firms do. Direct family ownership (ownership concentration) negatively (positively) affects dividend payouts. Among the CEO demographic characteristics, CEO tenure has a consistent and significant negative effect on the dividend payout. Firms in a strong corporate governance environment pay more dividends and are less likely to appoint family members as CEOs, suggesting that strong corporate governance forces firms to pay more dividends and restrains firms from appointing CEOs based on family ties.

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  • Briano-Turrent, Guadalupe D.C. & Li, Mingsheng & Peng, Hongfeng, 2020. "The impact of family-CEOs and their demographic characteristics on dividend payouts: Evidence from Latin America," Research in International Business and Finance, Elsevier, vol. 51(C).
    • Handle: RePEc:eee:riibaf:v:51:y:2020:i:c:s027553191930604x
    DOI: 10.1016/j.ribaf.2019.101086
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    5. Godlewski, Christophe J. & Le, Nhung Hong, 2022. "Family firms and the cost of borrowing: empirical evidence from East Asia," Research in International Business and Finance, Elsevier, vol. 60(C).
    6. Do, Trung K., 2021. "Shareholder litigation rights and corporate payout policy: Evidence from universal demand laws," Research in International Business and Finance, Elsevier, vol. 58(C).

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