Increased presence of foreign investors and dividend policy of Japanese firms

The impact of foreign investors on the risk-taking of Japanese firms

“…This reduces the sample to 1,615 firms providing 15,619 firm-year observations. As in Baba (2009) my main data source is AMSUS (Active Management Support System) supplied by Quick Corp. The primary data is the same as Nikkei NEEDS which has been extensively used in Japanese accounting and finance research.…”

“…David et al (2006) provide evidence that foreign investors promote R&D investments when firms exhibit better growth opportunities. Baba (2009) reveals that their growing participation in the Japanese stock market has lead to a significant increase in dividend payout. Hamao et al (2010) explain that foreign institutional investors facilitate the initiatives of activist funds requesting greater distributions, and are therefore associated with a significant decrease in cash holdings.…”

http://www.fin-izdat.com/journal/digest/detail.php?ID=72590

“…It diverges with findings of researches who conducted a similar analysis of companies in other countries [1][2][3][4][5]. It may conceivably stem from the fact that Russia is not an attractive country for foreign investment due to its economic unsustainability and political affairs with other countries.…”

“…In addition to researches into the Chinese market from perspectives of local businesses' response to foreign investors as shareholders, there are other studies proceeding from other countries [3][4][5]. Each of the above articles verifies hypothesis stating that dividend payouts directly depend on the presence of foreign investors in the company.…”

“…Based on the above statements, such scholars as Naohiko Baba [3] Besides, as part of this research, we examine some other hypotheses which our foreign colleagues previously suggested.…”