Abstract

Ownership structure is an influential factor on firm policies. One of these policies is dividend policy. Therefore, a significant relationship between ownership structure and dividend policy is expected. This paper examined the relationship between dividend policy and ownership structure in Tehran Stock Exchange from 2000 to 2007. In this study, four regression models were used. Institutional ownership was negatively associated with dividend payout. It indicated that the presence of institutional investors results in less usage from dividend as a signal for good corporate performance. Moreover, positive relationship was founded between dividend payout and concentrated institutional ownership. However, there was not a significant relationship between managerial ownership and dividend payout.

Key words: Ownership structure, institutional ownership, concentrated institutional ownership, managerial ownership, dividend policy.