1.1. Background of the study
The dividend of shareholders and its impact on productivity has been
severally been called into question. Most school of thoughts has it that
dividend of shareholders does not have a significant impact on their
productivity level while other school of thoughts are of the contrary
Dividend overtime has hada leading role to play in corporate
organizations and more especially in the wellbeing of shareholders.
Dividend off course helps to is increase or improve the revenue base of
shareholders, corporate monetary managers make different financial
decisions and dividend policy decision is cardinal amongst them (Baker
&Powell 1999) . Dividend decision has great impact on firm financial
decision and stock price and most importantly on its shareholders;
increase in dividends would improve the revenue base of its shareholders
while a decrease in dividend would be on the contrary as their
financial base would be negatively affected. Simians (1995) argue that
the productivity of shareholders is largely influenced by the
organization’s dividend policy. It is an approach which is used to
distribute the profit back to its shareholders. If a company is in a
growing stage, it may decide it will be reinvested in company’s future
projects rather than distributing the profit to shareholders .If a
company decides to pay dividend, it must decide how much and at what
rate dividend should be paid. Dividend policy plays a frontline role to
play in terms of the commitment and corporate productivity of its
shareholders. If a company pays handsome return to its shareholders it
will help to improve the productivity of its shareholders thereby
ensuring corporate growth of the company and vice versa. So we can say
dividend policy have a strong impact on growth and productivity.
Dividend policy is guidelines for financial managers, how to pay
dividend to the shareholders either through cash dividend or through
fixed percentage dividend. The primary objective of any organization is
to maximize the wealth of shareholders. Financial manager’s aim is to
take a decision in such a way that shareholders receive the high
contribution of dividend which leads to increase the price of share.
Because market price is an indicator of profitability, progress and
productivity of both the shareholders and company by extension, however,
it is an unresolved issue whether the dividend policy has impact on its
1.2. Statement of the general problem
The problem of productivity in corporate organizations especially
when it comes to employees has overtime been a puzzle. This is as a
result of the general problem of less productivity on the part of
employees and this has negatively affected the corporate growth of
companies. Overtime in Nigeria, shareholders dividend has witnessed a
negative trend of continual retrogression due to the harsh economic
situation of Nigeria. A major offshoot of this malady has led to
shareholders not giving their best as a result of lack of financial
motivation. This has negatively further affected the economic
development of Nigeria.
1.3. Objectives of the study
The following would be the aims and objectives of venturing into this study.
- To examine the impact of dividends on shareholders productivity.
- To know the impact of prompt payment of dividend on the growth of an organization.
- To examine the relationship between shareholders productivity and dividends.
- To recommend ways of improving shareholders productivity in Nigeria
1.4. Research Questions
The following would guide us as our research questions
- What is the impact of dividends on shareholders productivity?
- What is the impact of prompt payment of dividend on the growth of an organization?
- What is the relationship between shareholders productivity and dividends?
- Can shareholders productivity be improved through payment of dividends?
1.5. Research Hypothesis
H0: Dividends do not significantly influence shareholders productivity.
H1: Dividends significantly influence shareholders productivity.
1.6. Significance of the study
This study would be of immense benefit to corporate organizations in
terms of the pros and cons of dividend policy and how it relates or
affects shareholders. This work would equally be beneficial to
government at all levels, students and researchers who are interested on
the impact of dividends on shareholders productivity.
1.7. Scope and limitation of the study
This work is restricted to the productivity impact of dividends on
shareholders with dangote cement plant Lagos serving as a case study.
Limitation of the study
Financial constraint- Insufficient fund tends to
impede the efficiency of the researcher in sourcing for the relevant
materials, literature or information and in the process of data
collection (internet, questionnaire and interview).
Time constraint- The researcher will simultaneously
engage in this study with other academic work. This consequently will
cut down on the time devoted for the research work.