This has grown by $310bn since 2009, according to the group's new quarterly report, which analyses equity income from around the world.
“The search for income is more than just a response to rock-bottom interest rates in recent years. It marks a generational shift as ageing populations must increasingly rely less on state pensions and more on their own savings to provide for retirement. Not only that, but they will need to stay invested in equities much longer than in the past too. This demand for equity income is a trend we see continuing through 2014 and beyond," said Andrew Formica, CEO of Henderson Global Investors.
Geographic breakdown
The index reflected the varying results from different parts of the world. Initially, the fastest growth came from emerging markets. Emerging markets now make up $1 in every $7 of global payouts. Collectively, dividends from these countries have more than doubled since 2009, up from $60.9bn to $125.9bn. This marks an annual growth rate of almost 20%.
Making up 55% of all emerging market dividends, the BRIC countries – Brazil, Russia, India and China – have grown a third faster than their peers in the last five years. But post-2011 emerging market growth dwindled due to plunging currencies and the end of the commodity cycle. Asia Pacific dividends rose by 79% over the five-year period.
The second most important region for income, after North America, was Europe excluding the UK. Here dividends moved ahead 8% since 2009, reaching $199.8bn in 2013. Within Europe, Scandinavian countries witnessed a dividend boom while those hit by the euro crisis were noticeably paying far less to shareholders.
By far the largest source of dividend income, the US, amplified payouts by 49% over five years. Meanwhile UK payouts grew in line with the global average of 39% since 2009. Devaluation of the yen in 2013 pushed Japan’s total dividend payout below the 2012 level, but in total the country saw a 29% increase.
Industry growth
A picture has emerged in the culmination of data over the five year period of Henderson’s research where dividends have provided an insight into major economic events and trends.
“The reliance on a few big stocks, though significant, is less at a global level than it can be in some countries, especially the UK. This means that a global approach to income investing can bring real diversification benefits,” Alex Crooke, head of global equity income at Henderson Global Investors, added.
The sector which saw the biggest payout was, perhaps not unsurprisingly, financials which forked out $218bn in 2013, which amounts to 24% of the total. This is a post-crisis increase of 76%.
The fastest growth in payout from an industry perspective has come from the technology sector, which more than doubled by 109% since 2009. This is particularly due to Apple, which paid out nearly one sixth of global tech dividends in 2013 starting from 2012.
