The Impact of Corporate Governance on Dividend Payout of Manufacturing Firms Listed at the Nairobi Securities Exchange

Caroline Ikunda; Monica Muiru; Simon M Kamau

doi:doi:10.11648/j.jfa.20160405.12

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The Impact of Corporate Governance on Dividend Payout of Manufacturing Firms Listed at the Nairobi Securities Exchange

Caroline Ikunda, Monica Muiru, Simon M Kamau

Published in Journal of Finance and Accounting (Volume 4, Issue 5)

Received: 31 May 2016 Accepted: 12 June 2016 Published: 29 August 2016

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Abstract

This study sought to examine the impact of corporate governance on dividend payout of manufacturing firms listed at the NSE. The objectives of the study were; to determine the impact of board size, board composition, CEO tenure and managerial equity holding on dividend payout of manufacturing firms listed at NSE and finally, to establish the impact of corporate governance on dividend payout of manufacturing firms listed at NSE. The study employed a correlational research design and the population of the study comprised all manufacturing firms which were consistently listed at the Nairobi Securities Exchange from 2008-2014. Correlation and regression analysis were used to test the impact of the independent variables relating to corporate governance practices on the dependent variable (Dividend Payout). Independent one-way ANOVA test and independent t-test (one tailed) were used to determine the level of significance. The study found that board size, board composition, CEO tenure and management equity holding have a weak negative relationship with dividend payout. Further, the study found that board size has a statistical significant impact on dividend payout, while board composition, CEO tenure and managerial equity holding were found to have no statistical significant impact on the dividend payout. The empirical results from the multiple regression analysis indicated that there is a strong positive relationship between corporate governance and dividend payout. However, there was no statistical significant relationship between the two variables. Therefore, this study concludes that corporate governance has no impact on dividend payout of manufacturing firms listed at NSE.

Published in	Journal of Finance and Accounting (Volume 4, Issue 5)
DOI	10.11648/j.jfa.20160405.12
Page(s)	254-261
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2016. Published by Science Publishing Group

Keywords

Corporate Governance, Dividend Payout, Manufacturing Firms, Nairobi Securities Exchange

References

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APA Style

Caroline Ikunda, Monica Muiru, Simon M Kamau. (2016). The Impact of Corporate Governance on Dividend Payout of Manufacturing Firms Listed at the Nairobi Securities Exchange. Journal of Finance and Accounting, 4(5), 254-261. https://doi.org/10.11648/j.jfa.20160405.12

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ACS Style

Caroline Ikunda; Monica Muiru; Simon M Kamau. The Impact of Corporate Governance on Dividend Payout of Manufacturing Firms Listed at the Nairobi Securities Exchange. J. Finance Account. 2016, 4(5), 254-261. doi: 10.11648/j.jfa.20160405.12

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AMA Style

Caroline Ikunda, Monica Muiru, Simon M Kamau. The Impact of Corporate Governance on Dividend Payout of Manufacturing Firms Listed at the Nairobi Securities Exchange. J Finance Account. 2016;4(5):254-261. doi: 10.11648/j.jfa.20160405.12

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@article{10.11648/j.jfa.20160405.12,
  author = {Caroline Ikunda and Monica Muiru and Simon M Kamau},
  title = {The Impact of Corporate Governance on Dividend Payout of Manufacturing Firms Listed at the Nairobi Securities Exchange},
  journal = {Journal of Finance and Accounting},
  volume = {4},
  number = {5},
  pages = {254-261},
  doi = {10.11648/j.jfa.20160405.12},
  url = {https://doi.org/10.11648/j.jfa.20160405.12},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.jfa.20160405.12},
  abstract = {This study sought to examine the impact of corporate governance on dividend payout of manufacturing firms listed at the NSE. The objectives of the study were; to determine the impact of board size, board composition, CEO tenure and managerial equity holding on dividend payout of manufacturing firms listed at NSE and finally, to establish the impact of corporate governance on dividend payout of manufacturing firms listed at NSE. The study employed a correlational research design and the population of the study comprised all manufacturing firms which were consistently listed at the Nairobi Securities Exchange from 2008-2014. Correlation and regression analysis were used to test the impact of the independent variables relating to corporate governance practices on the dependent variable (Dividend Payout). Independent one-way ANOVA test and independent t-test (one tailed) were used to determine the level of significance. The study found that board size, board composition, CEO tenure and management equity holding have a weak negative relationship with dividend payout. Further, the study found that board size has a statistical significant impact on dividend payout, while board composition, CEO tenure and managerial equity holding were found to have no statistical significant impact on the dividend payout. The empirical results from the multiple regression analysis indicated that there is a strong positive relationship between corporate governance and dividend payout. However, there was no statistical significant relationship between the two variables. Therefore, this study concludes that corporate governance has no impact on dividend payout of manufacturing firms listed at NSE.},
 year = {2016}
}

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TY  - JOUR
T1  - The Impact of Corporate Governance on Dividend Payout of Manufacturing Firms Listed at the Nairobi Securities Exchange
AU  - Caroline Ikunda
AU  - Monica Muiru
AU  - Simon M Kamau
Y1  - 2016/08/29
PY  - 2016
N1  - https://doi.org/10.11648/j.jfa.20160405.12
DO  - 10.11648/j.jfa.20160405.12
T2  - Journal of Finance and Accounting
JF  - Journal of Finance and Accounting
JO  - Journal of Finance and Accounting
SP  - 254
EP  - 261
PB  - Science Publishing Group
SN  - 2330-7323
UR  - https://doi.org/10.11648/j.jfa.20160405.12
AB  - This study sought to examine the impact of corporate governance on dividend payout of manufacturing firms listed at the NSE. The objectives of the study were; to determine the impact of board size, board composition, CEO tenure and managerial equity holding on dividend payout of manufacturing firms listed at NSE and finally, to establish the impact of corporate governance on dividend payout of manufacturing firms listed at NSE. The study employed a correlational research design and the population of the study comprised all manufacturing firms which were consistently listed at the Nairobi Securities Exchange from 2008-2014. Correlation and regression analysis were used to test the impact of the independent variables relating to corporate governance practices on the dependent variable (Dividend Payout). Independent one-way ANOVA test and independent t-test (one tailed) were used to determine the level of significance. The study found that board size, board composition, CEO tenure and management equity holding have a weak negative relationship with dividend payout. Further, the study found that board size has a statistical significant impact on dividend payout, while board composition, CEO tenure and managerial equity holding were found to have no statistical significant impact on the dividend payout. The empirical results from the multiple regression analysis indicated that there is a strong positive relationship between corporate governance and dividend payout. However, there was no statistical significant relationship between the two variables. Therefore, this study concludes that corporate governance has no impact on dividend payout of manufacturing firms listed at NSE.
VL  - 4
IS  - 5
ER  -

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Author Information

Caroline Ikunda

Faculty of Commerce, Department of Accounting, Finance & Management Science, Egerton University, Nakuru, Kenya
Monica Muiru

Faculty of Commerce, Department of Accounting, Finance & Management Science, Egerton University, Nakuru, Kenya
Simon M Kamau

Faculty of Commerce, Department of Accounting, Finance & Management Science, Egerton University, Nakuru, Kenya

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APA Style

Caroline Ikunda, Monica Muiru, Simon M Kamau. (2016). The Impact of Corporate Governance on Dividend Payout of Manufacturing Firms Listed at the Nairobi Securities Exchange. Journal of Finance and Accounting, 4(5), 254-261. https://doi.org/10.11648/j.jfa.20160405.12

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ACS Style

Caroline Ikunda; Monica Muiru; Simon M Kamau. The Impact of Corporate Governance on Dividend Payout of Manufacturing Firms Listed at the Nairobi Securities Exchange. J. Finance Account. 2016, 4(5), 254-261. doi: 10.11648/j.jfa.20160405.12

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AMA Style

Caroline Ikunda, Monica Muiru, Simon M Kamau. The Impact of Corporate Governance on Dividend Payout of Manufacturing Firms Listed at the Nairobi Securities Exchange. J Finance Account. 2016;4(5):254-261. doi: 10.11648/j.jfa.20160405.12

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@article{10.11648/j.jfa.20160405.12,
  author = {Caroline Ikunda and Monica Muiru and Simon M Kamau},
  title = {The Impact of Corporate Governance on Dividend Payout of Manufacturing Firms Listed at the Nairobi Securities Exchange},
  journal = {Journal of Finance and Accounting},
  volume = {4},
  number = {5},
  pages = {254-261},
  doi = {10.11648/j.jfa.20160405.12},
  url = {https://doi.org/10.11648/j.jfa.20160405.12},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.jfa.20160405.12},
  abstract = {This study sought to examine the impact of corporate governance on dividend payout of manufacturing firms listed at the NSE. The objectives of the study were; to determine the impact of board size, board composition, CEO tenure and managerial equity holding on dividend payout of manufacturing firms listed at NSE and finally, to establish the impact of corporate governance on dividend payout of manufacturing firms listed at NSE. The study employed a correlational research design and the population of the study comprised all manufacturing firms which were consistently listed at the Nairobi Securities Exchange from 2008-2014. Correlation and regression analysis were used to test the impact of the independent variables relating to corporate governance practices on the dependent variable (Dividend Payout). Independent one-way ANOVA test and independent t-test (one tailed) were used to determine the level of significance. The study found that board size, board composition, CEO tenure and management equity holding have a weak negative relationship with dividend payout. Further, the study found that board size has a statistical significant impact on dividend payout, while board composition, CEO tenure and managerial equity holding were found to have no statistical significant impact on the dividend payout. The empirical results from the multiple regression analysis indicated that there is a strong positive relationship between corporate governance and dividend payout. However, there was no statistical significant relationship between the two variables. Therefore, this study concludes that corporate governance has no impact on dividend payout of manufacturing firms listed at NSE.},
 year = {2016}
}

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TY  - JOUR
T1  - The Impact of Corporate Governance on Dividend Payout of Manufacturing Firms Listed at the Nairobi Securities Exchange
AU  - Caroline Ikunda
AU  - Monica Muiru
AU  - Simon M Kamau
Y1  - 2016/08/29
PY  - 2016
N1  - https://doi.org/10.11648/j.jfa.20160405.12
DO  - 10.11648/j.jfa.20160405.12
T2  - Journal of Finance and Accounting
JF  - Journal of Finance and Accounting
JO  - Journal of Finance and Accounting
SP  - 254
EP  - 261
PB  - Science Publishing Group
SN  - 2330-7323
UR  - https://doi.org/10.11648/j.jfa.20160405.12
AB  - This study sought to examine the impact of corporate governance on dividend payout of manufacturing firms listed at the NSE. The objectives of the study were; to determine the impact of board size, board composition, CEO tenure and managerial equity holding on dividend payout of manufacturing firms listed at NSE and finally, to establish the impact of corporate governance on dividend payout of manufacturing firms listed at NSE. The study employed a correlational research design and the population of the study comprised all manufacturing firms which were consistently listed at the Nairobi Securities Exchange from 2008-2014. Correlation and regression analysis were used to test the impact of the independent variables relating to corporate governance practices on the dependent variable (Dividend Payout). Independent one-way ANOVA test and independent t-test (one tailed) were used to determine the level of significance. The study found that board size, board composition, CEO tenure and management equity holding have a weak negative relationship with dividend payout. Further, the study found that board size has a statistical significant impact on dividend payout, while board composition, CEO tenure and managerial equity holding were found to have no statistical significant impact on the dividend payout. The empirical results from the multiple regression analysis indicated that there is a strong positive relationship between corporate governance and dividend payout. However, there was no statistical significant relationship between the two variables. Therefore, this study concludes that corporate governance has no impact on dividend payout of manufacturing firms listed at NSE.
VL  - 4
IS  - 5
ER  -

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