Study On The Dividend Policies Of Hi-tech Enterprises

With continuingly rapid growth of hi-tech enterprises in China, both researchers and practioners in this field have paid much attention to the issue of profit distributions. It is believed that a appropriate dividend policy is practically critical for the growth of each hi-tech enterprise, as well as the healthy development of hi-tech industry.With reference to the research findings home and abroad, the characteristics of profit distribution for hi-tech enterprises are examined from the angles of parties concerned, payout ratio and means of distribution. As the three main elements of dividend policy, the content of those issues are surely different from general enterprises in the context of hi-tech enterprises. The thesis is developed from these three aspects.Among the parties concerned in the profit distribution of Hi-tech enterprises, emphasis is put on the importance of human capital owners. It has been put forward in the thesis, for the first time, the dividend policy of "Double-principal Pattern". In this pattern, designed for Hi-tech enterprises, the parties involved hi profit distribution includes not only the traditional material capital owners but also the human capital owners, who are critical for the success of the enterprise.As to the payout ratio, bases on analysis of the optimized dividend payment pattern from western theories, a moderate dividend payment policy is presented in this study. The proposed policy is characterized by three points. First, its purpose is to increase the value of the enterprise in a large scale. Second, it is not a fixed pattern of dividend policy. Finally, it should be applied in a number of stages. At different stage of the life circle of hi-tech enterprises, different dividend policies should be employed. They are none-dividend, fixed payout ratio, residual dividend and lowed normal dividend plus extra dividend in stages of deliberation, setup, growth and maturity respectively.When it comes to the means of paying, after stating the differences between general dividend paying methods and the special dividend paying methods to human capital owners, stock dividend is preferred for hi-tech enterprises, hi order to meet the needs of meeting requirements of all the stake-holders. Specifically, the dividend policy to human capital owners in hi-tech enterprises is up to the way the property rights are obtained, namely, the stock options and ESOP.To illustrate the research, empirical study of Shanghai Beiling Company is conducted. It's profit distribution policies are examined and analyzed. In order to give incentives to managers and chief technicians in the company, virtual stock options are designed to enable those human capital owners involved in the profit distribution. However, that purpose is restrained by the conditions of the stock market, the number of virtual stock options and supplementary bound mechanism.