EconPapers    
Economics at your fingertips  
 

Board structure and dividend smoothing: A case of Pakistani listed firms

Zahid Ali, Assad Ullah and Arshad Ali ()
Additional contact information
Zahid Ali: School of Accounting, Zhongnan University of Economics and Law
Assad Ullah: School of Management, Huazhong University of Science and Technology
Arshad Ali: University of Malakand

Business Review, 2019, vol. 14, issue 2, 65-91

Abstract: The purpose of this study is to empirically examine the effects of ownership and board structure on dividend smoothing for listed non-financial firms for the period 2005-2015 on the Pakistan Stock Exchange (PSX) in the light of agency and information asymmetry theory. Two measures, speed of adjustment and relative volatility are used to estimate dividend smoothing. Tobit regression is used for analyzing the effects of board structure on dividend smoothing measured via speed of adjustment while OLS is used for relative volatility. Additionally, the study applies the technique of principal component analysis (PCA) for board index. The results reveal that firms with large boards have a high level of dividend smoothing in Pakistan. They less frequently increase, cut, initiate and omit dividends. The substitution role of board independence is depicted by the negative association of board independence with dividend smoothing. Furthermore, independent audit committees and dividend smoothing are also found to be negatively associated.

Keywords: Dividend; smoothing; ·; Corporate; governance; ·; Substitution; ·; Pakistan. (search for similar items in EconPapers)
Date: 2019
References: View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
https://businessreview.iba.edu.pk/articles/board-s ... vidend-smoothing.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:aho:journl:v:14:y:2019:i:2:p:65-91

Access Statistics for this article

Business Review is currently edited by Dr. Wali Ullah

More articles in Business Review from IBA
Bibliographic data for series maintained by IBA ().

 
Page updated 2020-08-01
Handle: RePEc:aho:journl:v:14:y:2019:i:2:p:65-91