The Research Of Correlation Between Cash Dividend Policy And Sustainable Growth Of Listed Companies

Along with the trend of economic globalization and the continuous improvement of China’s market economy, the companies of China are facing fierce competition.The companies must keep developing in order to remain in the competition. The companies must constantly develop to bring in good returns for the investors due to their endless pursuit of the interests. The companies in the development process often pursuit the ultra-high-speed growth in the short term so that get huge market and profit under the internal and external factors. However, the ultra-high-speed growth is a double-edged sword for company. It won’t only bring more opportunities but also huge risk. From the financial management perspective, the ultra-high-speed growth is a sacrifice of future growth and the company’s resources are very tight, even lead to enterprise growth bankruptcy. However if the companies develop too slow or inadequate, the companies’resource will be waste, especially for the developing companies. The companies will miss a lot of development opportunities and maybe the object of strong mergers and acquisitions. Therefore, the companies make the reasonable and effective developing strategies and growth rate according to their resources. As one of the three policies of financial managements dividend policy is the core content of financial management activities and plays an important influence in the developing. But how the cash dividend policy affects the companies’ sustainable growth and how much the correlation is between them.This paper explains the company for sustainable growth theory, the theory of dividend policy and the relationship between them. The financial data of the471listed companies from2008to2010is chosen to test the influence of Dividend Policy to the Sustainable Growth by using the multiple regression analysis models. The results show that when the company ran into unbalanced growth, many the managers did not adopt a rational Cash Dividend Policy. At the same time, the rational Dividend Policy did not get the investors attention. The Signal Transmission theory of Cash Dividend is not obvious in our stock market. In order to promote the sustainable growth of listed companies the regulatory authorities should strengthen the management of the listed companies’financing constraints, and improve the information disclosure rules, restrictions on the Dividend Policy of listed companies. The management of the listed companies should improve the efficiency in using the funds; pay attention to the internal financing, comprehensive the sustainable developing concepts deeply. The majority of investors in the market should invest into the companies rational. At the same time the organization investors should be encouraged to boost up the stabilities and maturities of the stock market.