Define agency theory, please | Forex Trading and Money Exchange

Define agency theory, please
Posted 03 October, 2009 by Zaire T. Sanford from Garanhuns
Leverage Master, my name is Zaire Sanford from Garanhuns. I'm a complete newcomer, and there was something i don't conceive: what is agency theory?
Leverage Master Answers:
That's an important topic to apprehend, Zaire. Agency theory is A theory concerning the relationship between a principal (shareholder) and an agent of the principal (company's managers). Agency theory is a very academic term. Essentially it involves the costs of resolving conflicts between the principals and agents and aligning interests of the two groups.
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