The Impact Of Ownership Structure On Dividend Policy

Family listed companies have become an important component of the listed companies. Family listed companies in the healthy development have important significance to the healthy development of capital markets. Ownership structure is foundation of the corporate governance. Dividend policy of the listed company is one of the three core problems in modern company's financial activities. Therefore, the study of family ownership structure of listed companies and corporate dividend policy for the protection of the family relationship is very important.This paper tries to explain present dividend policy of Chinese private listed companies using agency theory and stewardship theory. According to the application border of agency theory and stewardship theory, the agency theory will be applied to the non-founding family companies; the stewardship theory will be applied to the founding family companies. Based on the analysis of two theories, we found the family ownership structure of founding family and non-founding corporate will have an important impact to dividend policy.First of all, by the comparative analysis of the different ownership collecting between the founding family and the non-founding family, found that the founding family ownership's concentration is higher than non-founding family. Secondly, the founding family tend to retained profits in the future development to seek more long-term benefits for external investors, and reducing the release of cash dividends, while the non-founding family controlling shareholders transfer cash from the listed company by cash dividends, so the founding family listed companies to pay cash dividends is lower than non-founding family listed companies. Finally, the higher the proportion of founding family hold, the more attention to long-term development will be paid, the less cash dividends will be distributed. While the higher the proportion of Non-founding family hold, the more capacity they have to determine the company's dividend policy and the more benefit will be got through payment of cash dividends.