Managerial remuneration and payout policy: evidence from Indian Regular payers


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This study attempts to examine the role of managers in the associated agency theory on dividend policy decisions for firms that do not skip dividend payments. This research sample considered the firms that are listed on the Bombay Stock Exchange (BSE) and pay regular dividends on an annual basis from the financial year 2011 to 2020. Panel data econometric tools and robustness tests were carried out for model validation.
The study results show that there is a higher positive relationship between change in payout ratio and managerial remuneration. Similarly, there is a large positive significance to increase manager incentive for regular payer firms with greater promoter control in higher dividend payout. Thus, this brings an agency theory perspective of rewarding well to managers to increase promoter wealth. Hence, policymakers can contemplate these findings to analyze the nexus between managers and promoters in the dividend policy of firms that never skip their dividend payments.

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    • Figure 1. Residual plot for equation (1)
    • Figure 2. Residual plot for equation (2)
    • Table 1. Summary of empirical studies on payout policy
    • Table 2. Correlation matrix
    • Table 3. Multicollinearity tests
    • Table 4. Model tests
    • Table 5. Results for equation (1)
    • Table 6. Results for equation (2)
    • Formal Analysis
      Chandrabhanu Das
    • Investigation
      Chandrabhanu Das, Manoj Kumar Jena
    • Methodology
      Chandrabhanu Das, Manoj Kumar Jena
    • Writing – original draft
      Chandrabhanu Das
    • Conceptualization
      Brajaballav Kar
    • Supervision
      Brajaballav Kar
    • Validation
      Brajaballav Kar
    • Writing – review & editing
      Brajaballav Kar, Manoj Kumar Jena
    • Software
      Manoj Kumar Jena
    • Visualization
      Manoj Kumar Jena