Using this executive compensation theory,shareholders negotiate the compensation contracts with the executive in hopes of aligning the executive's interests with theirs.
A)agency
B)tournament
C)social comparison
D)strategic

Question

Quizplus · Accepted Answer

The agency theory posits that executives may act in their own self-interest and not necessarily in the interest of shareholders. Therefore, shareholders negotiate compensation contracts with executives to align their interests and incentivize them to work in the best interest of the company.

Using This Executive Compensation Theory,shareholders Negotiate the Compensation Contracts with the Executive