Does prioritizing Sustainability affect dividend policy? Evidence from Emerging Economy
Keywords:
ESG disclosure, dividend decision, emerging market, panel data regression, National Stock Exchange, sustainability.Abstract
Purpose: This study aims to explore the impact of ESG disclosure on the dividend decision policy of firms.
Methodology: The sample for the study comprises Indian firms listed on the National stock exchange for the period of ten years i.e., 2012 to 2021. The Panel Data Regression Analysis has been employed to test the hypotheses.
Results and Conclusions: The overall findings of the study demonstrate that Environmental and Social disclosures impact the dividend policy of the firms positively but insignificantly. However, Governance performance has a negative but insignificant influence on the dividend payout ratio of the firms.
Research Implications: This study has several important implications for investors, business participants, academicians, and policymakers who aim to investigate the impact of ESG practices on a firm’s dividend decision policy. This study's findings can assist practitioners, policymakers, and investors in creating corporate strategies and investment plans.
Originality/ Value: This is the first empirical study, in the authors’ knowledge, that explores the effect of ESG disclosures on the dividend payout policy of firms in an emerging market, especially India.
