Controversies about agency theory as theoretical basis for corporate governance


  • Jan Kultys Cracow University of Economics



corporate governance, agency theory, stewardship theory, team production theory, director primacy model, shareholder primacy model


The issue of corporate governance is being taken up by different branches of science. Particular views on the nature and goals of a firm, as well as on corporate law, determine various approaches to the issue. The ongoing debate on corporate governance is being stimulated by notorious scandals and economic crises. The agency theory (prevailing today), which assumes egoism and pursuit of one?s own interests, forms the basis for shareholder primacy model, while team production theory forms the basis for director primacy model. Stewardship theory, which assumes convergence of management?s and stakeholders? interests, may be competing or complementary towards the agency theory, depending on situation. According to management theory, efficient management requires law regulation of managers? status. This paper is aimed at presenting controversies about traditional agency theory as theoretical basis for corporate governance, as well as at discussing other perspectives on the issue, which are extensions of the traditional theory or are based on substantially different premises. The analysis shows that going beyond agency theory allows for better understanding of the whole range of models of corporate governance as well as of the changes that are being proposed in the area. The method utilized in this paper is descriptive and comparative in character.


Download data is not yet available.


Alchian, A., & Demsetz, H. (1972). Production, Information Costs, and Economic Organization. American Economic Review, 62. DOI: EMR.1975.4306431.
Argyris, C. (1973). Organization Man: Rational and Self-actualizing. Public Administration Review, 33. DOI:
Asher, C. C., Mahoney, J. M., & Mahoney, J. T. (2005). Towards a Property Rights Foundation for Stakeholder Theory of the Firm. Journal of Management and Governance, 9. DOI:
Blair, M. M. (2005). Closing the Theory Gap: How the Economic Theory of Property Rights Can Help Bring ?Stakeholders? Back into Theories of the Firm. Journal of Management and Governance, 9.
Blair, M. M., & Stout, L. A. (1999a ). A Team Production In Business Organization: An Introduction. Journal of Corporate Law, Summer. DOI:
Blair, M. M., & Stout, L. A. (1999b). A Team Production Theory of Corporate Law. Journal of Corporate Law, Summer. DOI: ssrn.281818.
Carney, M., Gedajlovic, E., & Sur, S. (2011). Corporate Governance and Stakeholder Conflict. Journal of Management and Governance, 15. DOI:
Daily, C. M., Dalton, D. R., & Cannella, A. A. (2003). Corporate Governance: Decades of Dialogue and Data. Academy of Management Review, Vol. 28 (3).
Davis, J. H., Schoorman, F. D., & Donaldson, L. (1997). Toward a Stewardship Theory. Academy of Management Review, 22(1).
Donaldson, T., & Preston, L. E. (1995). The Stakeholder Theory of Corporation: Concepts, Evidence, and Implications. Academy of Management Review, 20(1). DOI:
Freeman, R. E, Wicks, A. C., & Parmar, B. (2004). Stakeholder Theory and ?The Corporate Objective Revisited?. Organization Science, 15(3). DOI:
Freeman, R. E., & Evan, W. M. (1990). Corporate Governance: A Stakeholder Interpretation. Journal of Behovioral Economics, 19(4).
Grandori, A. (2005). Neither Stakeholder Nor Shareholder ?Theories?: How Property Rights and Contract Theory can Help in Getting Out of the Dilera. Journal of Management and Governance, 9.
Hil, C. W. L., & Jones, T. M.. (1992). Stakeholders-Agency Theory. Journal of Management Studies, 29(2).
Jordi Canals, L. (2010). Rethinking the Firm?s Mission and Purpose. European Management Review, 7.
Kauffman, A., & Englander, E.. (2005). A Team Production Model of Corporate Governance. Academy of Management Executive, 19(3). DOI: 10.5465/AME.2005.18733212.
Lan, L. L, & Heracleous, L. (2010). Rethinking Agency Theory: The View from Law, Academy of Management Review, 15(2). DOI: AMR.2010.48463335.
Mamun, A. A., Yasser, Q. R., & Rahman, A. (2013). A Discussionof the Suitability of One vs More than One Theory for Depicting Corporate Governance. Modern Economy, 4.
Maslow, A. H. (1970). Motivation and Personalisty. New York: Harper & Row.
McGregor, D. (1960). The Human Side of the Enterprises. New York: McGraw-Hill.
Mesjasz, C. (2007). Ewolucja władania korporacyjnego. Zeszyty Naukowe UEK, 753.
Rajan, R. G., & Zingales, L. (2001). The Influence of the Financial Revolucion on the Nature of Firms. American Economic Review, 91(2).
Segrestin, B., & Hatchuel, A. (2011). Beyond Agency Theory, a Post-crisis VieW of Corporate Law. British Journal of Management, 22.
Sundarum, A. K, & Inkpen, A. C. (2004b). Stakeholder Theory and ?The Corporate Objective Revisited?: A Reply. Organization Science, 15(3). DOI:
Sundarum, A. K, & Inkpen, A. C. (2004a). The Corporate Objective Revisited. Organization Science, 15(3). DOI:
Wiseman, R. M., Cuevas-Rodrigues, G., & Gomez-Mejia, L. R. (2012). Toward a Social Theory of Agency. Journal of Management Studies, 49. DOI:
Zollo, M., & Freeman, E. (2010). Re-thinking the Firm in a Post-crisis Word. European Management Review, 7.




How to Cite

Kultys, J. (2016). Controversies about agency theory as theoretical basis for corporate governance. Oeconomia Copernicana, 7(4), 613–634.




Similar Articles

1 2 3 4 5 6 7 8 9 10 > >> 

You may also start an advanced similarity search for this article.