Impact of Information Asymmetry on the Russian Firms' Dividend Policy

Dividend policy nowadays applies to important aspects of firms’ financial management and can be an indicator of welfare and guarantee of good reputation of the company. Efficient dividend policy implies optimizing the proportions of consumed and capitalized profit. As managers are responsible for governing payout policy, one of the main factors that influence dividend policy is quality of informational environment. Depending on the quality of informational environment information asymmetry may occur. Among factors that influence firms’ dividend policies information asymmetry is considered to be one of the most contradictory ones. The question of significance of information environment in the market in terms of dividend policy has been discussed by researchers since 1960’s. As authors of previous studies have not reached a consensus, the purpose of this research is to explore the relation between payout policy and information asymmetry. Scientific novelty of this study lies in specifying the nature of relation between payout policy and information asymmetry in terms of the Russian emerging economy. According to previous studies, errors in analysts’ net income forecasts are used as the measure of information asymmetry. The base for empirical research is represented by data of 37 Russian non-financial firms that have been on the IMOEX from 2014 to 2019. Key method used in the empirical part of the study is regression analysis. Additionally, the relation is explored taking into account degree of state participation in firms’ share capital.