Dividend Policy Determinants Analysis of Russian Companies

Dividend policy is one of the most controversial issues in corporate finance because researchers do not have the sole opinion on the topic which factors determine payout policy. Economists consider the dividend policy of companies from different countries trying identifying its key factors, but for Russian market a number of papers are few. In this regard the current work contains the dividend policy determinants analysis of Russian firms. In this research main aspects of payout policy and dividend payment traditional theories are studied. Moreover, the paper includes the review of existing econometric research of both domestic and foreign authors whose works are devoted to the analysis of factors which influence amount of dividends. On the basis of Ruslana System data about 35 Russian public companies during the period from 2011 to 2014 (101 observations) the multiple regression analysis has been conducted in order to identify significant determinants of the payout policy. The analysis of Lintner's model has shown that the model is appropriate only for government companies because during determining dividend payments they take into account both profit in the current period and dividends in the previous period. According to results, Lintner's model is not suitable for Russian market. Furthermore, the model with the natural logarithm of dividend per share as a dependent variable has been built. As for regressors, 7 factors have been chosen. According to the results, 6 determinants are significant at 5% level: firm size, profit per share, the ratio of market capitalization to equity, return on assets, return on equity and financial leverage. With that profit per share, the ratio of market capitalization to equity, ROA and ROE have positive influence on dividend policy.