Use of Freed-Up Shares as Payment Method Influences the Economic Capacity of Minority Shareholders
DOI:
https://doi.org/10.15381/gtm.v26i51.25504Keywords:
minority shareholders, economic capacity, dividendsAbstract
This study examines how the payment of dividends through freed-up shares by companies listed on the Bolsa de Valores de Lima (BVL) during the period 2009-2016 has negatively affected the economic capacity of minority shareholders. The dividend policy adopted by these companies has caused economic harm due to the distribution of freed-up shares instead of cash dividends. The shareholders’ concern is justified as they expect a cash return on their investment, as dividends are considered their natural source of income. This provides them with immediate access to cash when needed, whereas receiving freed-up shares does not. To avoid further damage to the economic capacity of minority shareholders, the solution is to shift the dividend policy model from distributing freed-up shares to paying dividends in cash. The evidence gathered in this study provides information on the distribution of freed-up shares to shareholders, and the analysis conducted through indicators can be used as a model. Ultimately, the study concludes that the payment of dividends through freed-up shares has a negative impact on the economic capacity of minority shareholders.
Downloads
Published
Issue
Section
License
Copyright (c) 2023 Abdias Armando Torre Padilla
This work is licensed under a Creative Commons Attribution 4.0 International License.
THE AUTHORS RETAIN THEIR RIGHTS:
(a) The authors retain their trademark and patent rights, and also over any process or procedure described in the article.
(b) The authors retain the right to share, copy, distribute, execute and publicly communicate the article published in Gestión en el Tercer Milenio journal (for example, place it in an institutional repository or publish it in a book), with acknowledgment of its initial publication in the Gestión en el Tercer Milenio.
(c) Authors retain the right to make a subsequent publication of their work, to use the article or any part of it (for example: a compilation of their work, lecture notes, thesis, or for a book), provided that they indicate the source. of publication (authors of the work, magazine, volume, number and date).
