The Impact of Abolishing Shareholder Perks on Dividend Policy: Evidence from Japan

Key Points

• Dividends increased following the removal of shareholder perks, indicating a shift in corporate governance priorities.
• The average increase in dividends was 15% over a two-year period post-change, reflecting improved financial performance.
• Observational analysis of Japanese companies examined changes in dividend policies after abolishing perks to shareholders.
• Findings highlight the potential for enhanced shareholder value when companies focus on financial returns over perks.