The Influence of Firm-Specific Financial Characteristics on Dividend Payout: the Moderating Role of Ownership Concentration in Malaysian Public-Listed Companies

Tee, Chun Hao (2025) The Influence of Firm-Specific Financial Characteristics on Dividend Payout: the Moderating Role of Ownership Concentration in Malaysian Public-Listed Companies. Masters thesis, Tunku Abdul Rahman University of Management and Technology.

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Abstract

This research investigates the influence of firm-specific financial characteristics on dividend payout policy, with a particular focus on the moderating role of ownership concentration in Malaysian public-listed companies. Drawing upon theories such as Signalling Theory, Agency Theory, Life Cycle Theory, and the Free Cash Flow Hypothesis, the study examines six independent variables—profitability, leverage, liquidity, free cash flow, growth opportunities, and past dividend behaviour—to assess their relationship with dividend payout. Using secondary data from the 2023 annual reports of ten diverse Malaysian firms, the research employs quantitative methods including correlation, multiple regression, and moderation analysis. Findings reveal that profitability and free cash flow are positively associated with dividend payout and are marginally significant predictors. Leverage, liquidity, growth opportunities, and past dividend behaviour, while conceptually relevant, do not exhibit statistically significant relationships in this context. The moderation analysis indicates that ownership concentration, although not statistically significant, shows a positive directional effect, suggesting potential governance influence on the profitability–dividend nexus. The study contributes to the literature by integrating financial and governance perspectives into the dividend decision-making process. Practically, it offers insights for corporate managers aiming to align dividend strategies with shareholder expectations, and for regulators seeking to enhance transparency and investor protection in emerging markets like Malaysia.