A Study On The Relationship Between Institutional Investors And Cash Dividend Policy

Institutional investors in the past30years has developed rapidly along with the development of the global capital markets.They have been replaced the individual investors in capital market become the main investors, as well it thoroughly change the company’s shareholder structure.With the expansion of the scale and ownership, institutional investors’ position and function in the company rise, and increasingly become the important factors in the improvement of corporate governance. Securities market in China is not as developed as western developed capitalist countries market capacity and the scale of institutional investors is also small, however under the powerful support of national policy, China’s institutional investors also developing rapidly. From the progress of China’s institutional investors development, it is not difficult to find that one of the importantly reason that institutional investors have high-speed development is the positive attitude of our government supervision department.In our market,the minority’s interest often be accounted by the majority shareholders so management often place great hopes on institutional investors.So in recent years whether the institutional investors place direct or indirect positive effect on corporate governance of listed company?Or whether it influence the listed company cash dividend policy through the participate in the corporate governance?This paper began with reviews the domestic and foreign relevant literature expounds the theory of relationship between institutional investors and the cash dividend policy, then summarized the basic characteristics of the institutional investors and the general situation and characteristics of listed company cash dividend policy, and finally grouped the data that chose from our country after reform of non-tradable shares, selected two group data:low cash holdings and high investment opportunity company sample;high cash holdings and low investment opportunity sample, and establish Logistic model and multiple regression model for empirical investigation and get the research conclusion also give some recommendations.This article is divided into seven chapters, the main content of the chapters are as follows:Chapter0is an introduction, the thesis is briefly introduced, including the research background and specific problem, research framework and put forward the main content, the improvement and innovation of the study.Chapter1For literature review, first reviews the foreign literature of institutional investors, cash dividend and the relationship between them, and then reviews the domestic literature of institutional investors and finally make arrangement and classified of the literature.Chapter2Analyzed the development and characteristics of institutional investors and cash dividend.Chapter3Institutional investors and cash dividend theory analysis. Analyze a series of theory like the institutional investor’s "shareholder activism", agency theory, customer theory.Chapter4analysis the mechanism of institutional investor’s "shareholder activism", In view of cash holding and investment opportunity:management’s malicious sent in low cash holdings and high investment opportunity, and the agency problem in high cash holdings low investment opportunity companies, this paper puts forward to institutional investors cash dividend policy of the positive role. Finally, building models for institutional investors and cash dividend theoretical.Chapter5The empirical analysis shows whether the institutional investors affect dividend policy of the listed company and what kind influence is. Grouping2006-2010listed company data to low cash holdings high investment opportunities and high cash holdings low investment opportunities, then test how institutional investors affect dividend policy.Chapter6Sums up the research findings of this Paper, including its research conclusions and lessons, research limitations and the direction of further research.The main conclusions are as follows:(1) the probability of cash dividend has negative relationship with institutional investor shareholding percentage in low cash holdings and high investment opportunities samples.(2) the probability of cash dividend has positive relationship with institutional investors shareholding percentage in high cash holdings and low investment opportunities samples.(3) the amount of cash dividends has negative relationship with institutional investors shareholding percentage in low cash holdings and high investment opportunities samples.(4) the amount of cash dividends has positive relationship with institutional investors shareholding percentage in high cash holdings and low investment opportunities samples.