Corporate governance, firm performance and Dividend policy: Evidence from Jordanian and Australian Listed Firms

By

ACKNOWLEDGEMENT

My thanks go out to all who have helped me complete this study and with whom this project may have not been possible. In particular, my gratitude goes out to friends, facilitator and family for extensive and helpful comments on early drafts. I am also deeply indebted to the authors who have shared my interest and preceded me. Their works provided me with a host of information to learn from and build upon, also served as examples to emulate.

DECLARATION

I, (Your name), would like to declare that all contents included in this thesis/dissertation stand for my individual work without any aid, and this thesis/dissertation has not been submitted for any examination at academic as well as professional level previously. It is also representing my very own views and not essentially which are associated with university.

Signature:

Date:

ABSTRACT

This research study is an attempt to explore the empirical evidences on corporate governance, firm performance and dividend policy of the Australian and Jordanian firms. This research study explores the effects that corporate governance has on the firm's performance and dividend policy of the listed firms in Australia and Jordan. For the purpose of this research, secondary method of research has been adopted for this study. The researches that were conducted in the past on the same topic have been incorporate in this research study. The empirical evidences have shown that corporate governance has a significant impact on the firm performance and the dividend policy.

TABLE OF CONTENTS

ACKNOWLEDGEMENTii

DECLARATIONiii

ABSTRACTiv

CHAPTER 01: INTRODUCTION1

1.1Background of the Study1

1.2 Aim and Objectives2

1.3 Research Questions3

1.4 Layout of the Dissertation3

CHAPTER 02: LITERATURE REVIEW5

2.1 Introduction5

2.2 Corporate Governance5

2.3 Theories of Corporate Governance7

2.3.1 Agency Theory7

2.3.2 Stewardship Theory8

2.3.3 Resource Dependency Theory9

2.3.4 Stakeholder Theory10

2.4 Corporate Governance and Firm Performance11

2.5 Corporate Governance and Dividend Policy12

CHAPTER 03: RESEARCH METHODOLOGY13

3.1 Introduction13

3.2 Research Method13

3.3 Overview of the Secondary Research Method13

3.4 Reliability14

3.5 Validity15

3.6 Limitation of the Dissertation15

3.7 Conclusion16

CHAPTER 04: DISCUSSION AND ANALYSIS17

4.1 Introduction17

4.2 Empirical Evidences on Corporate Governance, Firm Performance and Dividend Policy for Australian and Jordanian Firms17

CHAPTER 05: CONCLUSION23

5.1 Recommendations24

REFERENCES26

CHAPTER 01: INTRODUCTION

Background of the Study

Corporate governance is mainly concerned with the ways in which the parties that are highly interested in the firm's well-being, especially stakeholders, attempt to make sure that the insiders and the managers are taking measures that are appropriate for the measures which safeguard the stakeholders' interests (Mangena & Chamisa, 2008). These measures are necessary due to the separation of the management's ownership, which is an increasingly important feature for the corporations in the world of today (Mak & Yvanto, 2002). A firm comprises of many owners that have no role in the management and managers who have no interest in the equity of the firm. Owners or shareholders' equity are usually large in numbers and therefore, on an average owners of the firm control a very small portion of the firm's shares (Johannisson and Huse, 2000). This increases the tendency of shareholders to take no interest in monitoring of the managers, who might pursue the interests differently ...