| No dividend and less dividend have been a chronic problem in the Chinese capital market for many years.Therefore,listed companies are often ridiculed as"penny pincher",which has seriously affected the good atmosphere of value investment and returns to shareholders in capital market.To this end,China Securities Regulatory Commission(CSRC)has issued a series of policies and regulations since 2001 in an attempt to guide and motivate the cash dividend of listed companies,and gradually transitioned from the initial qualitative supervision to the current quantitative regulation.In the background of the tightening of relevant regulatory policies,the enthusiasm of cash dividend of listed companies has increased significantly in recent years,and the level of cash dividend has also been rising.Among them,some listed companies choose cash dividend with high proportion or even exceed the current earnings level,which has aroused widespread concern and heated discussion in the capital market.So,is high cash dividends necessarily be good news?This paper holds that high cash dividend is not always a good thing in the specific institutional context of China.On the one hand,the large shareholder have the ability to influence even determine the company’s cash dividend decision,and on the other hand,because of the low purchasing cost of equity and limited stock flow,the large shareholder have incentive to achieve"cash-taking"claim through high cash dividend.Therefore,the high cash dividend of listed companies in China is likely to imply the opportunistic motivation of the large shareholder to occupy the interests of small and medium shareholders.In view of this problem,this paper uses the event study method to examine the short-term market reaction of 12,514 cash dividend announcements issued by China’s A-share listed companies from 2013 to 2017.The results show that:(1)Overall,compared with the low-cash dividend announcements,investors have significantly more positive market reaction to high cash dividend announcements,indicating that market investors have a general preference for cash dividends under the guidance of the CSRC’s these years.(2)More importantly,the positive market reaction to the high cash dividend announcement decreased with the increase in the proportion of limited sales held by the controlling shareholder,means that investors are able to see through the high cash dividend decisions made by the controlling shareholder for"cash-taking",and thus react more negatively.The research work of this paper has the following two aspects of contribution or innovation:In theory,this paper reveals the opportunistic motivation of the controlling shareholder in the decision-making of high cash dividend of listed companies and provides direct empirical evidence from the investors perspective creatively,which can enrich the relevant literature in the field of cash dividend;In practice,the conclusions of this paper can not only help investors to view the company’s high cash dividend behavior more objectively and dialectically,but also help relevant regulatory authorities to formulate more scientific regulatory policies on cash dividend,as the"one size fits all"policies that simply emphasize the level of dividend are worth discussing. |
