Effect of Board Independence, Current Ratio and Earnings Per Share on Dividend Policy: Moderating Role of Government Policy
Year: 2024
Type: article
Abstract: Prevalent exchange rate fluctuation and high inflation rate constrain earnings of information and communication technology companies in Nigeria. This study examined the effect of board independence, current ratio, government policy, earnings per share and the moderating role of government policy on Dividend Policy of information and communication technology companies in Nigeria. Nine hypotheses were formulated in a null form. Ex-post facto research design was used based on secondary data. Data were extracted from annual reports and accounts of eight information and communication technology companies from 2014 to 2023. The major theory underpinning this study is dividend supremacy theory. Panel conditional fixed-effect logistic regression was employed for the analysis. Findings from the study revealed that Current ratio and auxiliary explanatory variable BI*GP have indirect positive and significant effect on Dividend Policy. Board independence and government policy have indirect negative and significant effect on Dividend Policy of information and communication technology companies in Nigeria. The study therefore concludes that current ratio and auxiliary explanatory variable BI*GP have indirect positive effect while board independence and government policy have indirect negative effect on Dividend Policy of information and communication technology companies in Nigeria. The study recommends that executives of information and communications technology companies would increase participation of independent non-executive directors that would likely lead to increased earnings which in turn result to increased dividend payment. Policy makers would formulate policies that would likely result in cost reduction.
Author: Department of Finance, Bayero University Kano, Nigeria
Institution: Bayero University Kano
Language: English
Subfield: Accounting
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W6949325674
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