Dividend policy as a driver of corporate growth in sub-saharan Africa: Evidence in Nigeria

Dividend policy as a driver of corporate growth in sub-saharan Africa: Evidence in Nigeria

Author by Otitolaiye, Emmanuel Dare

Journal/Publisher: Indian-pacific Journal Of Accounting And Finance

Volume/Edition: 4

Language: English

Pages: 4 - 13

Abstract

Dividend policy remains an important topic in modern corporate
finance. Researchers, managers, and business owners seek to understand
the optimal dividend policy. This study examined dividend policy as a driver of
corporate growth in sub-Saharan Africa: evidence in Nigeria. The ex-post facto
research design was adopted to analyse how dividend policy spur the growth
of active insurance companies in the Nigerian Stock Exchange using
secondary data of the sampled firms for 2007 – 2018 while utilising descriptive
and inferential (regression) statistics in data analysis. The findings reveal that
dividend policy in terms of dividend payout has an insignificant negative effect
on corporate growth of insurance companies in Nigeria (?= -8.09E-05, p=0.77;
Adjusted R2=0.4093; F(4,139)=3.29; p=0.00 with the controlling effect of
efficiency, firm age and leverage which have a significant effect on corporate
growth of insurance companies in Nigeria. Specifically, the study reveals that
efficiency has a significant negative effect on corporate growth (?=-5.29,
p<0> growth (?=0.417, p<0> corporate growth (?=0.052, p<0> dividend policy does not significantly drive insurance companies' dividend
payout growth. The study recommends that insurance companies'
management retain more of their profits, improve their efficiency, and control
their leverage to further growth
 


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