Corporate Governance and Payout Policy: Do Founding Families Have a Special 'Taste for Dividends'?

CEFS Working Paper

29 Pages Posted: 18 Feb 2010 Last revised: 24 Oct 2012

See all articles by Thomas Schmid

Thomas Schmid

The University of Hong Kong - Faculty of Business and Economics

Markus Ampenberger

Technische Universität München - Center for Entrepreneurial and Financial Studies

Christoph Kaserer

Technische Universität München (TUM)

Ann‐Kristin Achleitner

Technische Universität München - Center for Entrepreneurial and Financial Studies

Date Written: October 2012

Abstract

This paper analyzes how the predominant example of a controlling shareholder, i.e., the firms’ founders and their families, influence payout policy. Using a panel dataset of 660 listed firms in the 1995 to 2006 period from Germany, we find that family firms exhibit a higher propensity and level for dividend payouts. Further tests indicate that this result is driven (i) by family ownership, not management and (ii) restricted to later-generation family firms. These findings are consistent with the view that the desire of families for a steady income stream without losing control shapes payout decisions in family firms.

Keywords: Dividend policy, share repurchases, payout policy, family firms

JEL Classification: G35

Suggested Citation

Schmid, Thomas and Ampenberger, Markus and Kaserer, Christoph and Achleitner, Ann-Kristin, Corporate Governance and Payout Policy: Do Founding Families Have a Special 'Taste for Dividends'? (October 2012). CEFS Working Paper. Available at SSRN: https://ssrn.com/abstract=1553650 or http://dx.doi.org/10.2139/ssrn.1553650

Thomas Schmid (Contact Author)

The University of Hong Kong - Faculty of Business and Economics ( email )

Pokfulam Road
Hong Kong
China

Markus Ampenberger

Technische Universität München - Center for Entrepreneurial and Financial Studies ( email )

Arcisstraße 21
München, 80333
Germany
++49 89 289 25483 (Phone)
++49 89 289 25488 (Fax)

HOME PAGE: http://www.cefs.de

Christoph Kaserer

Technische Universität München (TUM) ( email )

Arcisstr. 21
Munich, D-80290
Germany
+49 89 289 25489 (Phone)
+49 89 289 25488 (Fax)

HOME PAGE: http://www.cefs.de

Ann-Kristin Achleitner

Technische Universität München - Center for Entrepreneurial and Financial Studies ( email )

Arcisstr. 21
Munich, D-80290
Germany
+49 89 289 25181 (Phone)

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