AGENCY THEORY

BY: MIA FE E. UY

1
1
2
2
Agency Theory
is used to
understand the
relationships
between agents
and principal.

3
3
Agent – a party who is legally
authorized to act on behalf of
another party in business
transactions.

4
4
Principal
- is a party who gives
authority to another
to act on his behalf in
business transactions.

55
EXAMPLE: Wilma works for me at
my pet grooming business,
the Barks and Bubbles. I’m the
owner and in the process of
restocking my inventory
in my pet supply department,
I send Wilma to order some
products for my store.

6
6