Research On The Dividend Policy Of Chinese Listed Company Based On Agency Cost Theory

Dividend distribution policy of the listed company is one of the three core problems in modern company's financial activities. On the one hand, it is the logical sustaining step of company's financing and investment activities, one the other hand, sensible dividend distribution policy can build a good image for the company, advocate the investors' enthusiasm and eventually bring the company good opportunities for steady and extended development.However, because of the faulty ownership structure, obvious agent cost and the low efficiency stock market, the dividend distribution policy of Chinese listed company presents some anomaly aspects such as various forms of dividend distribution, severe phenomenon of short term distribution and none dividend distribution. With the rapid growth of Chinese stock market and the number of the listed company, more and more financial problems concerning dividend distribution are brought to the decision-makers of the company. Therefore, the listed company needs a scientific, systemic and useful theory and research outcome as the guidance. It is also urgently needed by the Chinese stock market some rules to normalize the listed company's dividend distribution policy.The article tries to interpret Chinese listed company's dividend policy using agency theory. Based on the comparison of western dividend policy theories, the article will analyze the agency cost theory, the artery theory of modern dividend policy theories and give an argument on the intimate relationship between the agency problems in Chinese listed company and its dividend policy mainly from the aspects of theories and data empirical depictions, moreover, will deeply anatomize the influence on dividend policy causing by ownership structure and proportion of state holdings from the side of ownership structure and eventually give the advice on policies to normalize the listed company's dividend policy from how to reduce the agency cost.The dividend distribution will cause the increase of external financing and subsequently cause the increase of agency cost. The article will take this situation into considered when discussing the model on confirming the best rate of dividend distribution. It will be emphasized as the main innovation of this article.