THE IMPACT OF DIVIDEND POLICY DECISION ON CORPORATE PERFORMANCE OF LISTED FIRMS IN NIGERIA

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THE IMPACT OF DIVIDEND POLICY DECISION ON CORPORATE PERFORMANCE OF LISTED FIRMS IN NIGERIA

Abstract

This research examine the impact of dividend policy decision on corporate performance of listed firms in Nigeria. It aims to ascertain if there is any significant relationship between dividend yield and share price of listed firms in Nigeria and determine the impact of retained earnings ratio on the share price of Nigerian banks. The cross-sectional research design was adopted in this study in the course of data collection. This is because the researcher made observations at a particular point in time and chi-square method was used in analyzing the data gathered. Based on the findings of the research work, it was revealed that dividend policy serve as a means of evaluating organizational performance in Nigeria firms and the study also revealed that dividend policy does not server as a means for evaluating but also disclose bad practices and weakness in the internal control system. Finally, it was recommended that organizations should ensure that they have a good and robust dividend policy in place. This will enhance their profitability and attract investments to the organizations and that directors of corporate organizations should be made to update records of shareholders including their next-of-kin to avoid a deliberate or undue retention of unclaimed dividend warrants.

CHAPTER ONE

INTRODUCTION

1.1 Background to the Study

So many factors affect the performance of corporate organization and one of those factors is dividend policy. Dividend policy serves as a mechanism for conduct of a managerial opportunism. The pattern of corporate dividend policies not only varies across countries, especially between developed, developing and emerging capital markets. If the value of a company is the function of its dividend payments, dividend policy will affect directly the firms cost of capital. But is there any significant relationship between dividend policy and corporate performance in form of profitability investment and earning per share? This is the question this research work will shed more light on.

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THE IMPACT OF DIVIDEND POLICY DECISION ON CORPORATE PERFORMANCE OF LISTED FIRMS IN NIGERIA

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