Which of the following theory is concerned with the diverse interests and goals that are held by a corporation's stakeholders and the methods by which the enterprise's reward system is used to align these interests and goals?
A) Social cognition theory
B) Behavioral theory
C) Classical management theory
D) Agency theory

Question

Quizplus · Accepted Answer

The theory described is Agency theory, which examines the relationship between a principal (e.g., a shareholder) and an agent (e.g., a manager) in terms of the alignment of interests and goals. The reward system is used to encourage the agent to act in the best interest of the principal, or to align their interests. The other three theories listed do not directly address this issue.

Which of the Following Theory Is Concerned with the Diverse