Rethinking agency theory in developing countries: A case study of Pakistan

Yusuf, Fatima and Yousaf, Amna and Saeed, Abubakr,(2018), Rethinking agency theory in developing countries: A case study of Pakistan. , Accounting Forum, UNSPECIFIED

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We investigate if agency theory effectively explains agency conflict in the context of a developing country namely, Pakistan. Utilising data from 26 semi-structured interviews, we found that in Pakistan, there is no variation in risk preferences of principals (minority shareholders) and agents (majority shareholders). We also found that remuneration packages and board independence are not effective tools for governing owner managers in Pakistan. Thus, policy makers must shift their focus from soft internal governance mechanisms of appropriate remuneration and board independence. We propose for a rigorous external audit function, and appointment of independent directors and external audit firms by regulator.
Keywords : Agency theory Developing countries Board independence Board remuneration Principal-principal conflict, UNSPECIFIED
Journal or Publication Title: Accounting Forum
Volume: 42
Number: 4
Item Type: Article
Subjects: Akuntansi
Depositing User: Users 8 not found.
Date Deposited: 20 Dec 2019 03:50
Last Modified: 20 Dec 2019 03:50

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