Research Article

Effect of Board Independence, Current Ratio and Earnings Per Share on Dividend Policy: Moderating Role of Government Policy

Mohammed Nasiru YUSUF1*, Tijjani Bashir Musa2, Muhammad Kabir Lawal1, Nasiru Yunusa3
1 Department of Finance, Business School, ABU, Zaria, Nigeria.
2 Department of Finance, Business School, ABU, Zaria. Nigeris.
3 Department of Accounting, Business School, ABU, Zaria, Nigeria.
* Corresponding author: mnyusuf@businessschool.abu.edu.ng
Published: Dec, 2024
DOI: 10.67894/bjf.2024.rbt44jl5
Pages: 99-113
Views: 11
Downloads: 3

Abstract

Prevalent exchange rate fluctuation and high inflation rate constrain earnings of information and communication technology companies in Nigeria. This study examined the effect of board independence, current ratio, government policy, earnings per share and the moderating role of government policy on Dividend Policy of information and communication technology companies in Nigeria. Nine hypotheses were formulated in a null form. Ex-post facto research design was used based on secondary data. Data were extracted from annual reports and accounts of eight information and communication technology companies from 2014 to 2023. The major theory underpinning this study is dividend supremacy theory. Panel conditional fixed-effect logistic regression was employed for the analysis. Findings from the study revealed that Current ratio and auxiliary explanatory variable BI*GP have indirect positive and significant effect on Dividend Policy. Board independence and government policy have indirect negative and significant effect on Dividend Policy of information and communication technology companies in Nigeria. The study therefore concludes that current ratio and auxiliary explanatory variable BI*GP have indirect positive effect while board independence and government policy have indirect negative effect on Dividend Policy of information and communication technology companies in Nigeria. The study recommends that executives of information and communications technology companies would increase participation of independent non-executive directors that would likely lead to increased earnings which in turn result to increased dividend payment. Policy makers would formulate policies that would likely result in cost reduction.  

Keywords

Panel logistic regression BI Dividend policy Government policy ICT

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How to Cite

YUSUF, M. N., Musa, T. B., Lawal, M. K., & Yunusa, N. (2024). Effect of Board Independence, Current Ratio and Earnings Per Share on Dividend Policy: Moderating Role of Government Policy. Bayero University Journal of Finance, 1(2), 99-113. https://doi.org/10.67894/bjf.2024.rbt44jl5

M. N. YUSUF, T. B. Musa, M. K. Lawal, and N. Yunusa, "Effect of Board Independence, Current Ratio and Earnings Per Share on Dividend Policy: Moderating Role of Government Policy," Bayero University Journal of Finance, vol. 1, no. 2, pp. 99-113, December 2024. doi: 10.67894/bjf.2024.rbt44jl5

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