An Empirical Study Of Semi-mandatory Dividend Policy

The Capital Market of China initially formed in the 1990s.Compared with the well-developed capital market of the United States and Europe,China's Capital Market started quite late,so there are many defects in the operation and regulation.One of the most widely questioned is the status quo of China's Capital Market dividends:Since the 1990s,the level of dividends of listed companies decline year by year,and many companies who do not dividend cash increased year by year,resulting in China's overall dividends level of capital markets at a low level for a long-term.More seriously,due to the lack of appropriate regulatory system,Zuozhuang phenomenon of market is unceasing,and thus can not protect the interests of the majority of investors,especially investors who prefer stable or long-term benefits for the ultimate goal.For renovating the chaos of China's Capital Market,China's Securities Regulatory Commission issued related to policy since the beginning of the 21st century,which is not mandatory for every listed company to carry out dividends,but linking its dividend policy to the refinance qualifications of listed companies,this regulatory system with soft binding nature is unified defined by practitioners and academics scholars as "semi mandatory dividend policy".However,since the semi mandatory dividend policy issued,the implementation effects and the rationality of the policy in the academic community had some negative controversy,mainly for the following aspects:1,"regulation paradox",which could force those companies who do have refinancing needs and capital shortage to obtain financing qualification to receive dividends,however,it is hard to restrain those companies who has good long-term performance but not have dividends;2,semi mandatory dividend policy produce negative impact on continuity and stability of dividends of listed companies,in order to meet the policy,some companies adopted opportunistic,phishing dividend behavior.For controversy and questions above,we propose the following questions:(1)whether semi mandatory dividend policy is to improve the overall level dividends of China' Capital Market or not?(2)Is raising the level of the dividend derived from the listed company's policy which meet the behavior,or out of consideration for the interests of shareholders?For this series of questions,this text carries out empirical study from the following aspects:(A)Analyze the overall effect of the semi-mandatory dividend policy to the level of China Capital Market.(B)Use the way of empirical study to find the raising of China Capital Market dividends level is from listed companies or their behavior to meet the policy considerations of the interests of shareholders.Through research,we present the following conclusions:(A)Semi-mandatory dividend policy improved the whole dividends and dividend levels of China Capital Market.(B)The improvement of dividends level and intention mainly due to the behavior of listed companies to meet the policy rather than its consideration of the interests of shareholders.Specific performance:(1)The company which is higher financing needs,lack of funds in order to meet the policy requirements(refinancing eligibility)significantly increase its level of dividends and dividends will,and the acts according to different stages will make different adjustments;(2)Semi-mandatory dividend policy has no significant impact on liquidity,good long-term performance of high-quality companies,namely semi-mandatory dividend policy cannot improve the liquidity of the company's dividend level and will,and cannot improve the continuous good long-term performance of the company dividend behavior and stability.