Evaluating Dividend Policy Theories at Global Corp

Global Corp is a large multinational company listed on several stock exchanges. Recently, the board of directors declared a dividend policy that emphasized stable dividends, aligning with the company's commitment to enhancing shareholder value while maintaining sufficient cash reserves for future investments. As a finance analyst, you are asked to evaluate how this policy aligns with well-known dividend theory concepts.

There are various theories regarding the determinants of dividend policy, including the Modigliani-Miller Proposition, the Bird-in-the-Hand Theory, and the Tax Preference Theory. Given these theories, determine which one best supports the decision by Global Corp's board to emphasize stable dividends.