10.1. Agency theory has been criticized for assuming that managers, left on their own, will behave in ways that reduce the wealth of outside equity holders when, in fact, most managers are highly responsible stewards of the assets they control. This alternative view of managers has been called stewardship theory. Would you agree with this criticism of agency theory?

Question

Abigayle Bass

Engineering

18 April, 22:37

10.1. Agency theory has been criticized for assuming that managers, left on their own, will behave in ways that reduce the wealth of outside equity holders when, in fact, most managers are highly responsible stewards of the assets they control. This alternative view of managers has been called stewardship theory. Would you agree with this criticism of agency theory?

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Answers (1)

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Brendan Kemp · Answer 1

answer is given below

Explanation:

Both agency theory and studentship theory have been proven to be correct and correct under different circumstances. The relevance of these principles depends on the work culture and policies of the organization. Each company has a different reward and recognition system and it is difficult to compare one company's system with another. In all circumstances it is not possible for an organization to find the right reward and punishment system. Much of this depends on the ability of the company's audit department, which should be very effective in tracking and tracking the performance of managers.