Leadership Influence On Dividend Payout Of The Malaysian Public Listed Companies
by Mahendrarajah a/l Selvaraja
The research aims to understand the leadership influence on dividend payout of Malaysian public listed companies. Dividend decision is solely at the discretion of top leadership that may be influenced by various factors such as financial, non-financial and macro-economic factors.
Through empirical studies in relations to Dividend Relevance Theory, many variables having significant influence on dividend decisions are uncovered. Out of which, this research focuses on financial factors that are made available through secondary data published on Internet website, www.klse.i3investor.com. These 7 independent financial variables are Net Profit Margin (NPM), Return of Equity (ROE), Revenue per Share (RPS), Operating Expenses per Share (OEPS), Tax per Share (TPS), Earnings per Share (EPS) and Net Assets per Share (NAPS).
Purposive sampling technique is implemented to gather the data for 765 companies listed on main market of Bursa Malaysia for 9 years period between years 2010 to 2018. The regression analysis is conducted through IBM SPSS AMOS statistical software to understand the relationship between these independent variables with Dividend per share (DPS) being the dependent variable. The outcome of the regression analysis to test the Hypotheses is described as Coefficient (ß), Significance test (P-Value) and Coefficient of determination (R2).
The research found that NPM, ROE, RPS, OEPS and EPS have positive significance on Dividend per share (DPS), while TPS is very insignificant and NAPS hypotheses is rejected. Overall 68% of the model is explained with the relations between DPS and 7 independent variables. Investors and Analyst interested in best dividend companies should utilize the dividend distribution model in this research as a guide.
It is also suggested that future research should explore developing KLDI (Kuala Lumpur Dividend Index) of Top Dividend driven listed companies in Malaysia and extend to ASEAN region.