Ownership Structure and Dividend Policy in Indonesia

Abstract

The purpose of this study is to examine how ownership structure affects dividend policy. Using 278 non-financial firms that have been listed on the Indonesia Stock Exchange for the past five years, this quantitative study examines the impact of ownership structure on dividend policy using multiple linear regression tests. The Signaling Theory and the Agency Theory are related theories. According to the findings, the dividend policy had a significant positive relationship with debt and profitability, a negative but negligible relationship with managerial ownership and company growth, and a negligible positive relationship with institutional ownership firm size. On the other hand, dividend policy and firm age were significantly correlated negatively.