The Relationship between Corporate Governance and Dividend Payouts: Evidence from Thai Listed Companies
Received 18/04/2560 Sukritta Burinwattana1 Jantima Ngankokkruad2
Revised 21/08/2560 Chittichai Horthong3
This research examined the relationship of corporate governance practices, and dividend payouts in the Stock Exchange of Thailand (SET). The study used multiple linear regression to examine the effects of several corporate governance factors (board size, CEO duality, audit committee meeting frequency, institutional ownership, and CEO compensation policy) on dividend payout ratios in a cross-sectional sample of firms listed on the SET in 2015 (n = 267). The results showed that there was a weak but significant relationship (r2 = 0.246) between institutional ownership and CEO compensation. Other factors were not significant to dividend payouts. The implication of these findings is that while corporate governance practices influence dividend payouts, this effect is weak enough that there are probably additional confounding variables. The relationship between specific corporate governance practices and dividend payouts is not well understood, and is an area that requires further study. However, it must be acknowledged that the two factors identified are those that directly relate to the interests of managers and institutional investors. Thus, it is possible that Thailand’s public firms have opposing pressures of investor interest, insider self-dealing, and self-interested CEOs and managers.
Keywords : corporate governance, dividend payouts, CEO compensation, institutional interest, Stock Exchange of Thailand
1Nakhonratchasima Rajabhat University
2Assistant Professor, Nakhonratchasima Rajabhat University
3Assistant Professor, Nakhonratchasima Rajabhat University