AIC publishes latest list of investment company ‘dividend heroes’

The Association of Investment Companies (AIC) has published the latest list of 17 dividend heroes, investment companies which have consistently increased their annual dividends for at least 20 years in a row.

Seven of the 17 dividend heroes have now increased their dividends for 50 or more consecutive years. City of London, Bankers and Alliance are out in front with 55 years of dividend rises, followed by Caledonia Investments (54 years), BMO Global Smaller Companies (51) and F&C Investment Trust (51). The latest addition to the over 50 years club is Brunner which announced its 50th year of increased dividends on 16 February.

A further four dividend heroes have increased their dividends each year for between 40 and 49 years and three dividend heroes have increased their dividends consecutively for between 30 and 39 years. A full table of all 17 dividend heroes is below.

Annabel Brodie-Smith, Communications Director of the Association of Investment Companies (AIC), said: “With markets remaining volatile and inflation rising rapidly following the heart-wrenching war in Ukraine, investors are looking for ways to protect their income. Investment companies’ ability to hold back up to 15% of the income they receive each year in a revenue reserve gives them an enormous advantage in delivering income to investors. This means investment companies can boost their dividends in years when income would otherwise have fallen short, something investors will be thankful for in these uncertain times.

“It’s a great achievement that we now have seven dividend heroes with at least half a century of unbroken annual dividend increases. These dividend heroes have consistently raised their dividend every year during the inflationary environment of the 1970s and through the market crashes of Black Monday, the tech bust, the financial crisis and the pandemic.” 

Investment company dividend heroes

Investment companyAIC sectorNumber of consecutive years dividend increasedDividend yield (%)5-year annualised dividend growth rate (%)
City of LondonUK Equity Income554.973.74
Alliance TrustGlobal552.088.33
Caledonia InvestmentsFlexible Investment541.863.64
BMO Global Smaller CompaniesGlobal Smaller Companies511.2010.34
F&C Investment TrustGlobal511.605.38
JPMorgan ClaverhouseUK Equity Income494.495.81
Murray IncomeUK Equity Income484.301.36
Scottish AmericanGlobal Equity Income482.733.21
Merchants TrustUK Equity Income395.152.53
Scottish MortgageGlobal390.392.93
Value and Indexed Property IncomeProperty – UK Commercial345.473.22
BMO Capital & IncomeUK Equity Income283.992.41
Schroder Income GrowthUK Equity Income264.353.84
Aberdeen Standard Equity IncomeUK Equity Income216.296.60

Source: AIC/Morningstar. Data at 09 March 2022

Why does being a dividend hero matter to your shareholders?

Mark Atkinson, Head of Marketing and Investor Relations at Alliance Trust, said: “Those of our shareholders who are looking for income greatly value the confidence they can have in the consistently growing dividends we provide for them. Alliance Trust is a core holding for long-term investors seeking capital growth and rising income. We know our investors have financial goals and rely on their investments to support those goals, whether pension saving, inheritance planning, paying off the mortgage or helping the children buy a home.”

Peter Ewins, Manager of BMO Smaller Companies Investment Trust, said: “We know that a lot of our shareholders like the progressive dividend and our aim is to deliver a high total return with capital performance alongside this – smaller company investors are looking for capital growth in the main but if we can also deliver them higher income year by year, then all the better.”

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