Corp Gov and ESG Flashcards
1
Q
Principal-agent relationship
A
- the principal hires an agent to carry out a task or service
- the agent is obliged to act in the best interests of the principle
shareholders are principal, mgmt are the agents
2
Q
Benefits of Effective Governance and Stakeholder management
A
balancing the interests of managers, BOD, company’s stakeholders, and shareholders
- operational efficiency
- improved control
- better operating and financial performance
- lower default risk and cost of debt
