Dividend Policy of Manufacturing Companies Reviewed based on Managerial Ownership and Profit Growth

Hariany Idris(1*), Helmia Nursyaqila Hamda(2),

(1) Department of Accounting, Faculty of Economics and Business, Universitas Negeri Makassar
(2) Department of Accounting, Faculty of Economics and Business, Universitas Negeri Makassar
(*) Corresponding Author

DOI: https://doi.org/10.26858/pdr.v6i2.45818


Thisl study aims to determine whether there is an effect of managerial ownership and profit growth on dividend policy in manufacturing companies. The variable of this research is managerial ownership as the independent variable (X1) which is measured by the percentage of the number of shares owned by management to the total number of shares owned by the company then multiplied by 100%. Profit growth as (X2) as an independent variable as measured using the ratio of current year's net profit (Yt) minus the previous net profit (Yt-1) to the previous year's net profit (Yt-1) then multiplied by 100%. And Dividend Policy asl the dependentl variable (Yl) as measuredl by thel Dividend Payout Ratio is the ratio that shows the results of the comparison between cash dividends per share and earnings per share then multiplied by 100%. The populationl in thisl study arel all manufacturing companiesl listed onl the Stockl Exchange. Indonesian Securities (IDXl) with al sample of three years froml 2019 to 2021 which was taken using a purposivel sampling ltechnique. Data collectionl was carried out usingl a documentation technique. Datal analysis wasl performed usingl descriptive statistical analysis, classic assumption test and hypothesis test with the help of IBM SPSS 25 software. The results of this study indicate that based on the results of simultaneous test calculations (F test), it can be seen that the calculated F value is 4,426 > F table 3,15 with a significant level of 0,016 < 0,05. So that managerial ownership and profit growth simultaneously or jointly have a significant effect on dividend policy. And the t test in the table shows the calculated t value for the managerial ownership variable of 1,889 and t table of 2,000. If the two are compared, then the t count is smaller than the t table (1,889 < 2,000). This shows that managerial ownership has no effect on significant dividend policy. As well as the profit growth variable, the value of t count is 2,553 > t table 2,000, which means that profit growth affects significant dividend policy. This is also supported by a significant value of 0,013< 0,05, which means that there is a significant influence between profit growth and dividend policy.


Managerial Ownership; Profit Growth; Dividend Policy

Full Text:



Ahmad, M. F., Aziz, S., El-Khatib, R., & Kowalewski, O. (2023). Firm-level political risk and dividend payout. International Review of Financial Analysis, 86, 102546. https://doi.org/https://doi.org/10.1016/j.irfa.2023.102546

Avanzi, B., Lau, H., & Wong, B. (2020). Optimal periodic dividend strategies for spectrally positive Lévy risk processes with fixed transaction costs. Insurance: Mathematics and Economics, 93, 315–332. https://doi.org/https://doi.org/10.1016/j.insmatheco.2020.05.012

Basse, T., Klein, T., Vigne, S. A., & Wegener, C. (2021). U.S. stock prices and the dot.com-bubble: Can dividend policy rescue the efficient market hypothesis? Journal of Corporate Finance, 67, 101892. https://doi.org/https://doi.org/10.1016/j.jcorpfin.2021.101892

Brinker, L. V., & Eisenberg, J. (2021). Dividend optimisation: A behaviouristic approach. Insurance: Mathematics and Economics, 101, 202–224. https://doi.org/https://doi.org/10.1016/j.insmatheco.2021.08.008

Chen, J., Song, W., & Goergen, M. (2019). Passing the dividend baton: The impact of dividend policy on new CEOs’ initial compensation. Journal of Corporate Finance, 56, 458–481. https://doi.org/https://doi.org/10.1016/j.jcorpfin.2019.04.004

Creswell, J. W., & Creswell, J. D. (2017). Research design: Qualitative, quantitative, and mixed methods approaches. Sage publications.

Fernau, E., & Hirsch, S. (2019). What drives dividend smoothing? A meta regression analysis of the Lintner model. International Review of Financial Analysis, 61, 255–273. https://doi.org/https://doi.org/10.1016/j.irfa.2018.11.011

Harakeh, M. (2020). Dividend policy and corporate investment under information shocks. Journal of International Financial Markets, Institutions and Money, 65, 101184. https://doi.org/https://doi.org/10.1016/j.intfin.2020.101184

Harakeh, M., Lee, E., & Walker, M. (2019). The effect of information shocks on dividend payout and dividend value relevance. International Review of Financial Analysis, 61, 82–96. https://doi.org/https://doi.org/10.1016/j.irfa.2018.10.009

Herdhayinta, H., Lau, J., & Shen, C. H. (2022). Cash holdings of minority family businesses in Indonesia. Emerging Markets Review, 100968. https://doi.org/https://doi.org/10.1016/j.ememar.2022.100968

Lakhal, F., Kuzey, C., Uyar, A., & Karaman, A. S. (2023). The relationship between dividend payout and corporate social responsibility: The moderating effect of shareholder friendliness and board monitoring. Journal of Cleaner Production, 394, 136297. https://doi.org/https://doi.org/10.1016/j.jclepro.2023.136297

Li, W., Zhou, J., Yan, Z., & Zhang, H. (2020). Controlling shareholder share pledging and firm cash dividends. Emerging Markets Review, 42, 100671. https://doi.org/https://doi.org/10.1016/j.ememar.2019.100671

Miller, D., Amore, M. D., Quarato, F., & Corbetta, G. (2022). Family Ownership Dispersion and Dividend Payout in Family Firms. Journal of Family Business Strategy, 13(3), 100436. https://doi.org/https://doi.org/10.1016/j.jfbs.2021.100436

Poretti, C., & Blal, I. (2020). The asset-light strategies and the dividend puzzle: International evidence from the hospitality industry. International Journal of Hospitality Management, 91, 102639. https://doi.org/https://doi.org/10.1016/j.ijhm.2020.102639

Simshauser, P. (2023). On dividend policy and market valuations of Australia’s listed electricity utilities: Regulated vs. merchant. Economic Analysis and Policy, 77, 696–715. https://doi.org/https://doi.org/10.1016/j.eap.2022.12.009

Trinh, Q. D., Haddad, C., & Tran, K. T. (2022). Financial reporting quality and dividend policy: New evidence from an international level. International Review of Financial Analysis, 80, 102026. https://doi.org/https://doi.org/10.1016/j.irfa.2022.102026

Wang, Q., & Qiu, M. (2023). Strength in numbers: Minority shareholders’ participation and executives’ pay-performance sensitivity. Pacific-Basin Finance Journal, 79, 102015. https://doi.org/https://doi.org/10.1016/j.pacfin.2023.102015

Xu, R., & Woo, J.-K. (2020). Optimal dividend and capital injection strategy with a penalty payment at ruin: Restricted dividend payments. Insurance: Mathematics and Economics, 92, 1–16. https://doi.org/https://doi.org/10.1016/j.insmatheco.2020.02.008

Article Metrics

Abstract view : 36 times | PDF view : 3 times


  • There are currently no refbacks.

Copyright (c) 2023 Hariany Idris, Helmia Nursyaqila Hamda