FBA1032 Corporate & Investment Finance Assignment 2025-26 | DCU
FBA1032 Corporate & Investment Finance
The Relationship between ESG Practices and Dividend Policy: Implications for Corporate Financial Management’
Background
Environmental, Social, and Governance (ESG) considerations have become central to corporate financial management and investor decision-making. At the same time, dividend policy remains a core issue in corporate finance, reflecting both shareholder expectations and managerial choices. The intersection of ESG and dividend policy raises important questions:
- Do firms with stronger ESG performance distribute profits differently?
- How do sustainability commitments influence payout strategies and capital structure decisions?
- What are the implications for corporate value, investor preferences, and longterm growth?
Required:
This assignment requires students to critically evaluate these questions by applying theoretical frameworks, empirical evidence, and case analysis.
Working in groups of four, you are required to produce a report that:
1. Literature Review & Theoretical Framework
- Summarise and critically evaluate the main theories of dividend policy (e.g., signalling, agency costs, life-cycle theory).
- Review the literature on ESG and its impact on corporate financial decisions.
2. Empirical Evidence
- Analyse at least two academic studies (peer-reviewed) that examine the relationship between ESG and dividend policy.
- Compare and contrast their findings, methodologies, and implications.
3. Case Study Analysis
- Select two publicly listed companies (from different sectors and/or geographies) and analyse how ESG performance appears to influence their dividend decisions.
- Use publicly available financial reports, sustainability disclosures, and market commentary.
4. Critical Discussion
- Assess whether ESG engagement strengthens or weakens a firm’s ability/willingness to pay dividends.
- Consider stakeholder perspectives (investors, regulators, managers).
- Discuss implications for shareholder wealth maximisation versus stakeholder value creation.
5. Conclusion & Recommendations
- Summarise key insights from your analysis.
- Provide recommendations for corporate managers and/or policymakers regarding integrating ESG with dividend policy decisions.
Suggested Structure and Word Allocation
- Introduction (300–350 words)
- Theoretical Framework (600–700 words)
- Literature Review & Empirical Evidence (600–700 words)
- Case Study Analysis (700–800 words)
- Critical Discussion (500–600 words)
- Conclusion & Recommendations (250–300 words)
- References & Appendices (not included in word count)
- Use Harvard referencing style.
- Append tables/figures with financial data or ESG scores.
- Ensure all references are cited appropriately.
- Students must comply with the university’s academic integrity policies.
Ensure all references are appropriately cited.
- Generative AI tools (e.g., ChatGPT, Copilot, Gemini) should only be used as support (e.g., for brainstorming, clarifying concepts), not as a substitute for original analysis.
- All sources of information, including AI-generated content, must be appropriately acknowledged and referenced if used.
- Plagiarism will not be tolerated; ensure all sources are correctly
FBA1032 Assignment Requirements:
- Word Count: 3,000 (±10%) words
- Assignment Weight: 20% of overall module grade
- Format: The assignment should be typed, double-spaced, using a size 12 font