Are Managerial Ownership and Financial Performance Affect Dividend Policy?

Abstract

Managerial ownership is one of the factors that can affect dividend policy. This study aimed to determine the effect of managerial ownership and financial performance on dividend policy. The financial performance comprises free cash flow, liquidity, profitability, and firm size. The population in this study includes all consumer goods industrial sector companies listed on the Indonesia Stock Exchange (IDX) for the 2016-2020 period. The sample collection method is purposive sampling, with a total sample of 35 companies. Analysis of the data used in this study is logistic regression analysis. Dividend policy is measured by the dummy variable, the value of 1 for companies that distribute dividends and 0 otherwise. The results of data analysis show that managerial ownership and profitability have no significant effect on dividend policy. Meanwhile, free cash flow, liquidity, and firm size have a significant effect on dividend policy.