Abstract
The study sought to examine the impact of independent directors on dividend policies of non-financial companies in Sri Lanka. The study was obtained panel data from annual reports of listed ninety six non-financial companies over the periods 2011-2015. A fixed effect panel regression model was selected to examine the objectives of the study.The findings revealed that when the board has independent directors at least two or one third of total directors, non- financial companies increase dividend payments with increase of net earnings,total assets and previous year?s dividend payments or vice versa. No significant impact of leverage on dividend policies of non- financial companies in Sri Lanka. The results were consistent with agency theory, steward theory and signaling theory while the results were supported to align the conflict of interest between shareholders and managers and also signaling to stakeholders. The findings are useful to management body to understand the corporate governance quality status, policy makers and regulators to strictly follow up or enhance the guideline of board independence of non-financial companies, and investors to select the best suit stocks in building their portfolio.
Keywords
Independent Directors, Dividend Policies, Non- Financial Companies, Sri Lanka
Citations
IRE Journals:
MACN.Shafana , Dr. S. Safeena MG Hassan
"Board Independence And Dividend Policy In Listed Non-Financial Companies In Sri Lanka " Iconic Research And Engineering Journals Volume 2 Issue 11 2019 Page 134-143
IEEE:
MACN.Shafana , Dr. S. Safeena MG Hassan
"Board Independence And Dividend Policy In Listed Non-Financial Companies In Sri Lanka " Iconic Research And Engineering Journals, 2(11)
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