Investment Association calls for 'greater transparency' on dividends

The Investment Association (IA) is urging businesses to 'improve the transparency of their approach to paying dividends'.

29 May 2019

The Investment Association (IA) is urging businesses to 'improve the transparency of their approach to paying dividends'.

According to the IA, companies not seeking a shareholder vote on dividend payments 'risk depriving shareholders of the opportunity to have a say on a matter that is pivotal to the organisation's attractiveness to investors'.

The IA has called for firms to publish a 'distribution policy', outlining their approach to paying shareholders dividends. Such a policy will 'provide shareholders with an opportunity to engage on companies' approaches to paying dividends', the Association stated.

Commenting on the matter, Business Minister Kelly Tolhurst said: 'I thank the IA for this report, which shines a light on companies who are not giving their shareholders a say on dividends.

'The government welcomes the further work being undertaken to encourage companies, as a minimum, to set out a distribution policy for shareholders. This type of policy makes sure shareholders have a clear basis for engaging with companies on their approach to dividends, investment and other uses of cash.

'We are committed to ensuring the UK's largest companies become even more transparent and accountable, which is why we have implemented reforms to upgrade our corporate governance and continue to seek further ways to ensure the UK remains the best place in the world to work, invest and do business.'

Browse our library section

Great tips and advice you can download

Find out more

Follow us on Twitter

Copyright

© 2020 Lawrence Grant. All rights reserved. We use cookies on this website, you can find more information about cookies here.

Lawrence Grant

We are a member firm of the Institute of Chartered Accountants of England & Wales (ICAEW). Registered to carry on audit work in the UK and Ireland. Our Insurer is Prosure Solutions (per W R Berkley , and IGI), 34 Lime St, London EC3M 7AT (worldwide, excluding North America). Also an independent member of GGI, a multidisciplinary worldwide association of accountants, tax consultants & lawyers.