A Dividend Policy refers to the guidelines a company has in place when it comes to the rate of dividends per share, the frequency of dividends, the reinvestment of dividends and the treatment of dividends. It is important to understand the dividend policy so you know what the company will be paying out and what should be deducted from your salary.In the US, most companies have a dividend payout policy that specifies how often, how high, and from which shares. The dividend policy governs how the company distributes its earnings in the form of dividends.A dividend policy is the policy a company uses to structure its dividend payout to shareholders. There is a lot of confusion around what the dividend policy is but, in essence, a dividend policy is the plan that a company uses to determine the dividend amount, which is the amount of money the company distributes to the shareholders of the company. A company's dividend policy is published in the company's annual report and the company's website. If your company does not have a dividend policy, it is important to find one.
