Dividend policy on controlling and non-controlling shareholders: case in Indonesia

Dividend policy, as part of corporate governance, is largely dependent on the institutional environment in which companies operate. The study aims to determine factors affecting dividend policy in the conditions of the Ukrainian underdeveloped stock market, legal insecurity of minority shareholders, high cost and concentration of capital. For this purpose, hypotheses about the impact of a company’s financial state, size, business risk, and ownership structure on dividend payments were tested using a sample of 58 Ukrainian non-financial public joint-stock companies and applying Interactive tree classification techniques (C&RT). The resulting classification model for predicting dividend decisions correctly classifies 92.86% of companies that paid dividends and 93.3% of companies that did not. The findings, based on the classification tree and importance scale, prove the hypothesis that companies in which individuals and institutional investors have a controlling interest are more likely to pay dividends than other non-state companies. The financial indicators accurately classify only those firms that do not pay dividends, and business risk does not affect classification accuracy at all. The paper substantiates the ways of using the study findings for economic regulation, protection of minority shareholders’ rights, and proliferation of modern corporate governance practices.

The article deals with issues of formalization and elaboration of business strategies. The authors have formulated a hypothesis that there is no universal strategy ensuring maxi¬mum benefit to an enterprise. The choice of a company’s strategy is considered from the point of view of a game-theoretical interpretation as a competition component. The process of engineering a company’s business strategy is presented in the form of a technological network. The study shows the possibility of automating the selection of a strategy by decision-making support systems. The article outlines the problem of classifying enterprise strategies by general features. The structure of a company’s strategy is formalized as a relationship of a set of strategic objectives in the S.M.A.R.T. technique and a set of means to achieve the goals limited by a company’s capabilities. The authors examine the indicator structure for achieving strategic goals. A definition is given to the type and form of a strategy based on the pattern concept. The article defines a methodology for assessing the probability of achieving the strategic goal. A new concept of a fluid strategy has been introduced along with several other variations of business strategies that might be encountered.

This study aims to determine the assessment of financial performance and the effect on dividend policy of banking companies listed on the Indonesia Stock Exchange in the period of 2014–2017. The assessment of the company’s financial performance is important. Results of the assessment will be consideration of financial performance for investors, one of them to predict the dividend policy. The prediction results will influence investors in making investment decisions. This study employs a quantitative approach. The assessment of financial performance is measured using variables of leverage, profitability and profit growth. They were analyzed using the multiple linear regression method. At the 0.05 significance level, the results of this study showed that the leverage has a negative and significant effect on dividend policy. Meanwhile, profitability and profit growth have no effect on dividend policy. In order to explain the influence between variables, the research is based on the theories underlying the dividend policy, namely the theory of residual dividends and smoothing theory. The results of this study support the residual dividend theory, that one of the dividend policies is determined by the company by considering the target capital structure and then distributing dividends with only the remaining profit.