Listed Companies in Spain Increase Dividend Payments To Highest Levels Since 2019

The dividend party has increased this year among listed companies and lures investors in Spain. This remuneration used to reward shareholders is gradually recovering after being hit by pandemic. Spain’s listed companies distributed €19.06 billion in dividends in the first seven months of 2022, approximately the same figure as that from the whole last year.

Including estimated dividends that companies will pay at the closing of the year, this amount would rise by €5 billion, and the annual figure will be the highest since 2019, approximately €24 billion. In 2021, €20.4 billion were distributed in dividends, according to Spain’s stock exchange operator BME.

Higher investment In Public Spending and R&D Boosts Spain’s Digital Competitiveness  

Spain’s digital competitiveness improved in 2022 and ranked up three positions to the 28th spot in the IMD’s world ranking. Increase of public spending in education, investment in R&D and the improvement in corporate dynamism in the private sector have been the main reasons for this national improvement. 

Spain overtook economies like Portugal, Italy and Greece, but it remains behind countries such as United Kingdom, Germany, Belgium, France and Ireland. Denmark leads this ranking composed of 63 economies, followed by United States and Sweden. This annual barometer measures the capabilities of those economies to adopt, assess and use new digital technologies to transform government practices, business models and society. 

Government to Raise Taxes on Large Companies and Capital Gains 

Government has announced a tax increase to large companies, as utilities and banks, as well as to private capital gains. Spain’s Socialist and far left wing coalition Government aims at a tax policy that ‘punishes’ those with larger incomes and favor those with lower ones. This new tax policy has been decided during the negotiation between both parties, Socialists and Unidas Podemos, when drafting the General State Budget for 2023. 

According to the Media, sources involved in the negotiations indicated that the consensus reached regarding the raise of the tax burden on large companies is to try to improve the efficiency of the minimum interest rate of 15% introduced in the Corporate Income Tax. 

On top of that, both parts of the negotiation fully agree on the creation of a new tax that specifically targets big fortunes and that focuses on taxing those who are avoiding the payment of the Wealth Tax thanks to regional tax credits, like the well know credit offered by the Madrid Regional Government or the one recently approved in Andalusia. 

The government is working against the clock in order to take the National Budget to the Council of Ministers on Tuesday, October the 4th. 

Spanish Listed Companies Improve Corporate Governance Standards

Spanish listed companies’ commitment to corporate governance standards improved in 2021 as their degree of compliance grew to 86.4%, three points higher than that from 2020, according to a report of Spain’s Stock Market Regulator (CNMV). Firms moved faster in the implementation of new recommendations introduced in the Code of Good Governance in 2020.

Women on the boards of listed companies rose to 29.3% in 2021, the report added. That means three points higher than the previous year and a total of 359 female directors. This percentage soared to 34.2% in the IBEX-35 companies.

The boards of directors’ remuneration increased by 13.2% in 2021 due to one-off payments, the report said. In the other hand, last year, 70.6% of the IBEX-35 companies had at least 50% independent directors on their boards, compared to only 67.7% in 2020.

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