Your are viewing a read-only archive of the old DiS boards. Please hit the Community button above to engage with the DiS !
if so, what is the agency problem of a company?
Where the management of a business is separated from it's ownership by the employment of professional managers, the managers may be considered to be the agents of the owners. Agency theory is concerned to analyse the ways agents may be expected to behave and how they can be motivated to promote their principals' interest.
It's all to do with gettin managers to work in the best interest of the owners and not their own.