agency problem

Definition

A conflict that exists in an organization between those who are in positions of control or trust (agents) and those whose interests are to be served (principals or stakeholders) in which actions taken by the agents instead serve their own interests. Such conflicts tend to arise more frequently in organizations that lack sufficient or effective material, moral and coercive incentives for agents to act otherwise. Also called principal-agent problem.

Use agency problem in a sentence

Browse by Letter: # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
agency pass-through agency theory