Board diversity and dividend policy in India

This study investigates the association between board diversity attributes – gender, experience, age, nationality, educational level, and tenure ‒ and dividend policy in Indian firms. We use the dividend payout ratio and dividend yield in a panel Tobit regression model. Our panel dataset comprises 65 firms drawn from the NIFTY 100 Index of India's National Stock Exchange (NSE) between 2013 and 2019. Our evidence shows that gender and experience diversities help explain why firms pay high dividends. Female directors encourage paying high dividends. In contrast, age diversity is a negative determinant of dividend policy. Foreign directors are an insignificant determinant of a firm's dividend policy, perhaps because they represent a small percentage of the board. Educational and tenure diversities are also insignificant drivers of dividend policy. This study contributes to agency and resource dependence theories by considering specific board diversity attributes among Indian firms related to dividend payments.