Study On Correlation Between Dividend Policy And Sustainable Growth Of Gem Listed Corporations

With the deepening of economic globalization and integration, the Chinese stock market has experienced an over-20-year history, successively carried on important reforms like equity division reform, the launch of financing securities and the establishment of GEM. It has been very difficult for science and technology innovation-oriented enterprises to finance, and the GEM has opened a financing shortcut. The pursuit of growth is an important goal of listed companies, especially for the gem ones. Facing the fierce competition environment, the management of the gem companies has to focus on the issue of how to make better and continuous development. Starting in 1956, Lin Turner uncovered the prelude to the dividend policy research, and later Miller and Modigelianni published the article of Dividend Policy, Growth and Stock Price, in which they explained the theory of dividend irrelevancy. Then from different angles, western scholars each began to research into dividend policies and put forward different new viewpoints, esp. the “dividend puzzle” by Black made the dividend policy into a deeper mystery. Chinese scholars’ research on dividend policy has experienced a slow process. Although the number of research articles is on the rise, the depth is still not enough. Scholars have their own understanding of the effects of dividend policies upon the sustainable development of listed companies. On the basis of scholars’ studies, the author makes a research, from the relevance perspective, on the relationship between the dividend policy and the sustainable development of a listed company and puts forward some guiding ideas.In the dissertation, the combination of normative and empirical research methods is adopted. The introduction part narrates the background of the selected topic, the significance of research and the structure of the dissertation. The first part introduces the research background.The second part introduces the basic theories, and expounds the concept and types of dividend policies and the sustainable growth policies. The third part has combed the domestic and foreign research literature about dividend policy and the sustainable growth. The fourth part expounds the theories of dividend policy and the sustainable growth and typical models. Based on the research hypotheses, descriptive statistical analysis and multivariate linear regression model are used to analyze the sample, and the empirical method is applied to study the correlation between dividend policy and the sustainable growth. The fifth part is the conclusion. The research shows that there is significantly positive correlation between the amount of cash dividend distribution and the sustainable growth rate and between the amount of the stock dividend and the sustainable growth rate.The possible innovations in the dissertation are: innovation of research angle. There are lots of results of the research home and abroad on dividend policies and sustainable growth, which focuses on the aspects like the correction of sustainable growth model and whether listed companies has made sustainable growth. The study of the correlation between dividend policies and enterprises’ sustainable growth is comparative little and the study of the impact of the quantity of dividend distribution and different dividend payment on sustainable growth is even less. Therefore, the topic of the dissertation is quite new. Secondly innovation of research scope. The existing researches on the correlation between dividend policy and sustainable growth are mainly made among the listed enterprises in the main, medium and small sized board, while the dissertation selects the listed GEM companies in Shenzhen Stock Exchange as the samples, and the sample data provide more favorable evidence for the conclusion.