Get 20M+ Full-Text Papers For Less Than $1.50/day. Start a 14-Day Trial for You or Your Team.

Learn More →

A survey of management views on dividend policy in Iranian firms

A survey of management views on dividend policy in Iranian firms Purpose – The purpose of this paper is to investigate the views of chief financial officers (CFOs) of Iranian firms listed on the Tehran Stock Exchange about the factors influencing dividend policy in 2006. The paper aims to update and extend previous research on dividend policy to capture the determinants of the dividend policy of Iranian firms. Design/methodology/approach – Survey instruments were used to identify the factors that CFOs consider in formulating dividend policy, based on both theoretical and empirical works on dividends, to identify the factors that are most important in dividend policy of firms. Findings – The findings show that the most important determinants of a firm's dividend policies are the stability of cash flow, the availability of profitable investment opportunities, and stability of profitability. Also, industry type appeared to influence the importance that respondents placed on one determinant of dividend policy. Research limitations/implications – It is likely that the firms that did not respond on time may show a non‐response bias. Despite lacking normal precautionary steps to increase the response rate, non‐response bias may affect the findings. Another limitation of the survey methodology was that it measures beliefs and not necessarily actions. Therefore, caution should be taken in generalizing the findings. Practical implications – The findings have implications for CFOs in formulating dividend policy. Originality/value – The paper updates and extends previous research on dividend policy to capture the determinants of the dividend policy of Iranian firms. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png International Journal of Islamic and Middle Eastern Finance and Management Emerald Publishing

A survey of management views on dividend policy in Iranian firms

Download PDF
12 pages

Loading next page...
 
/lp/emerald-publishing/a-survey-of-management-views-on-dividend-policy-in-iranian-firms-jhxVwnWKT4
Publisher
Emerald Publishing
Copyright
Copyright © 2009 Emerald Group Publishing Limited. All rights reserved.
ISSN
1753-8394
DOI
10.1108/17538390910946249
Publisher site
See Article on Publisher Site

Abstract

Purpose – The purpose of this paper is to investigate the views of chief financial officers (CFOs) of Iranian firms listed on the Tehran Stock Exchange about the factors influencing dividend policy in 2006. The paper aims to update and extend previous research on dividend policy to capture the determinants of the dividend policy of Iranian firms. Design/methodology/approach – Survey instruments were used to identify the factors that CFOs consider in formulating dividend policy, based on both theoretical and empirical works on dividends, to identify the factors that are most important in dividend policy of firms. Findings – The findings show that the most important determinants of a firm's dividend policies are the stability of cash flow, the availability of profitable investment opportunities, and stability of profitability. Also, industry type appeared to influence the importance that respondents placed on one determinant of dividend policy. Research limitations/implications – It is likely that the firms that did not respond on time may show a non‐response bias. Despite lacking normal precautionary steps to increase the response rate, non‐response bias may affect the findings. Another limitation of the survey methodology was that it measures beliefs and not necessarily actions. Therefore, caution should be taken in generalizing the findings. Practical implications – The findings have implications for CFOs in formulating dividend policy. Originality/value – The paper updates and extends previous research on dividend policy to capture the determinants of the dividend policy of Iranian firms.

Journal

International Journal of Islamic and Middle Eastern Finance and Management – Emerald Publishing

Published: Apr 3, 2009

Keywords: Dividends; Business policy; Iran; Factor analysis

References

  • Determinants of dividend policy: the case of Kuwait
    AL‐Deehani, T.M.
  • Factor influencing dividend policy decisions of corporate India
    Anand, M.
  • Dividend achievers: a behavioral look
    Baker, H.K.; Farrelly, G.E.
  • Determinants of corporate dividend policy: a survey of NYSE firms
    Baker, H.K.; Powell, G.H.
  • A survey of management views on dividend policy
    Baker, H.K.; Farrelly, G.E.; Edelman, R.B.
  • Factors influencing dividend policy decisions of NASDAQ firms
    Baker, H.K.; Veit, E.T.; Powell, G.H.
  • Payout policy in the 21st century
    Brav, A.; Graham, J.R.; Harvey, C.R.; Michaely, R.
  • The pricing of dividend consistency
    Dobson, J.; Dufrene, U.; Tawarangkoon, W.
  • A sampling procedure for mailed questionnaires
    EL‐Badry, M.A.
  • The evolution of corporate dividend policy
    Frankfurter, G.M.; Wood, B.G.
  • Efficient market tests of the informational content of dividend announcements: critique and extension
    Kwan, C.
  • Test Scores and What They Mean
    Layman, H.
  • Dividend Policy: It's Impact on Firms' Value
    Lease, R.C.; John, K.; Kalay, A.; Loewenstein, U.; Sarig, O.H.
  • Distribution of incomes of corporations among dividends retained earnings and taxes
    Lintner, J.
  • Dividend policy, growth, and the valuation of shares
    Miller, M.; Modigliani, F.
  • The predictive content of earnings forecasts and dividends
    Penman, S.H.
  • The interactions between the investment, financing and dividend decisions of major US firms
    Pruitt, S.W.; Gitman, L.J.
  • Rating scale as measures of clinical judgment: a method for increasing scale reliability and sensitivity
    Taylor, J.
  • Dividend changes and security prices
    Woolridge, J.R.