TITLE:
The Largest Shareholder Holdings, Cash Dividends and Supervision of Board —An Empirical Analysis from Chinese Market
AUTHORS:
Ziyao Yang
KEYWORDS:
The Largest Shareholder Holdings, Cash Dividends, Monitoring Directors, Tunneling Theory
JOURNAL NAME:
Open Journal of Business and Management,
Vol.4 No.3,
July
22,
2016
ABSTRACT: Based on tunneling theory and principal-agent theory, setting 2008 to 2014 listed companies in
China as samples, this paper explores the relationship between largest shareholders’ shareholdings
and cash dividends, and meanwhile, identifies the supervisory directors according to their office
and education background to analyze the influence of supervision role of board to the relationship
between the largest shareholding and cash dividends. The empirical results show that the higher
the shareholdings of the largest shareholder, the more cash dividends per share. In addition, the
higher the proportion of supervisory directors, the smaller the influence of the largest shareholding
on cash dividends, which means supervisory directors can inhibit the tunneling behavior of the
largest shareholders to a certain extent, and the board of directors play a role of supervision.