| Summary: | 碩士 === 輔仁大學 === 會計學系碩士班 === 94 === The objective of this study is to explore the effects of corporate governance on dividend policy and share repurchase decision. It also investigates the interactive effects of corporate governance and growth opportunities on dividend policy and share repurchase decision. The data are obtained from the non-financial companies listed in the Taiwan Stock Exchange and the Taiwan OTC market from 1999 through 2004. The proxies for corporate governance include the ownership held by the controlling shareholder, the deviation between the cash flow right and the voting right of controlling shareholder, and the affiliation of board of directors to the controlling shareholder.
The findings of this study are as the follows:
1. As the deviation between the cash flow right and the voting right of the controlling shareholder gets larger or the affiliation of board of directors to the controlling shareholder get closer, both the dividend payout level and the dividend payout likelihood will decrease. The similar results are also found for the share repurchase decision. This finding supports the entrenchment effect of the cash flow right - voting right deviation and board affiliation.
2. For those firms with strong corporate governance as proxied by small deviation between the cash flow right and the voting right held by the controlling shareholder, the negative effect of growth opportunities on dividend payout level will be exemplified. This finding supports the conjecture that good corporate governance will alleviate the concern of minority shareholders about the entrenchment effect of the controlling shareholder.
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