The “dividend puzzle” has been an unresolved problem since the 1950s. The purpose of this paper is to investigate the nature and a level of the relationship between board characteristics dividend policy. The study used a positivistic approach and Spearman correlation metric, descriptive statistics, and binary regression models have been deployed as analytical tools. It is found that food and beverages sector had the highest percentage for dividend payout from 2015 to 2019. The highest percentage for women on boards was 13% in the land and property sector. The average board size for the selected companies was 8. The likelihood to pay dividends, women on boards, the board size, and CEO duality indicated a significant positive relationship. Panel regression results indicate that there is no significant relationship between board characteristics and the level of dividend payment for the selected sample. But in a sectorial analysis audit committee size has a significant negative relationship with the level of dividend payment in the manufacturing sector whereas board gender diversity has a significant positive relationship with the same in the food and beverage sector. In summary, dividend decision has been affected by several board characteristics, but such factors had no significant impact on the level of dividends declared in the market. The sectorial analysis revealed that several characteristics affected the level of dividends in two sectors
Board of directors in corporate governance is conceptualized as the perceived ability of a firm to constrain and direct corporate power so that it efficiently creates economic value and equitably distributes economic wealth. Accordingly, this study examines the relationship between the level of compliance with the principles on corporate governance related to the board of directors and corporate performance of listed firms in Sri Lanka using secondary data related to 133 listed companies from 2009 to 2016. This study constructed Board Index related to dimensions (principles): Chairmanship, Nomination Committee, Audit Committee, Remuneration Committee, and Re-election of directors, Company Secretary, Role of the Board, Board Meetings and Board Independence. This study employs panel regression model to examine the relationship between the Board Index (BI) and their relationship with corporate performance and performed with Hausman test for random and fixed effects. The findings indicated that the compliance with these principles are positively related to the financial performance and negatively related with market performance. Thus, this study provides empirical support for the agency perspective in the context of compliance requirements of board of directors leading to higher corporate performance. Insights of this research are offered to listed firms by the compliance of corporate governance principles have the potential to improve company performance.
The COVID-19 impact has caused rethinking about Corporate Sustainability in the world. During the last decade, the relationship between Corporate Governance (CG) and Corporate Sustainability (CS) has been discussed by various scholars in the world, but with inconclusive evidence. This study systematically reviews the literature to understand the relationship between compliance with corporate governance principles and its impact on CS in order to understand the trend, country-wise publications, journals of publications, methods applied, and the relationship in the past and to discuss the possible relationship, and finally to provide a future agenda. For this systematic review, the SCOPUS database was utilized due to having comprehensive coverage of sources in the selected area. This study reviewed related articles from the year 1998 to 2020. There were 1,205 articles at the first screening and finally 70 qualified articles were selected for final review after assessing each article based on the inclusion and exclusion criteria. The findings of this study suggest that CG and CS area is an emerging field and the published journal articles and citations during the period 1998 to 2020 have increased drastically. Further, according to the review, only 30% of studies have been published in the Asian context. Moreover, approximately 80% of the articles considered the theoretical underpinnings of this relationship using Agency theory, Legitimacy theory, and Stakeholder theory. Further, the systematic literature review indicated that only very few studies used primary data, and most of the studies used listed firms as a sample of the study. Besides, the majority (94%) of the studies used regression analysis as the data analysis method. Finally, most of the research (78%) articles found a positive relationship between CG and CS and only a few (16%) articles found a negative, mixed, and no relationship. This paper contributes the research knowledge on CG and CS literature via shedding theoretical and empirical insights. Further, as this paper highlights predominantly the positive relationship between CG and CS, and thus managers and policymakers could focus more on CG to improve CS. Keywords: Corporate Governance, Corporate Sustainability, Systematic Review
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