Applying evidence from recently available public information on Enron, I defined Enron’s culture as one rooted in agency theory by asserting that Enron’s members were predominantly agency-reasoning individuals. I then identified conditions present at Enron’s collapse: a strong agency culture with collectively non-compliant norms, a munificent rare-failure environment, and new hires with little business ethics training. Turning to four possible antidotes (selection, objectivist integrity, integrity capacity, and stewardship reasoning) to an agency culture under these conditions, (...) I argued that the currently available ethics literature would have made little difference toward averting Enron’s collapse if any of the recommendations from the relevant ethics literature had been implemented. I conclude by identifying new directions for business ethics literature in order to make it more implementable under the conditions identified at Enron. Essentially, we need a way to clearly determine (1) the difference between connivance and commitment, (2) what is meant by balance with regard to the multiple dimensions of ethics and legal theories, and (3) the proper balance between agency and stewardship reasoning. (shrink)

This study examines the influence of board independence on firm agency cost among listed firms in Bangladesh, which feature concentrated ownership and high insider representation on corporate boards. This study uses three measures of agency cost: the ‘expense ratio’, the ‘Q-free cash flow interaction’ and the ‘asset utilization ratio’. The finding of the study is that board independence can reduce the firm agency cost only under ‘asset utilization ratio’ measure of agency cost. These findings are robust (...) to several robustness tests. Furthermore, the non-linearity tests suggest that the benefit of outside independent directors is generally plausible as a factor controlling agency costs in the case of a medium level of board independence. Overall, these findings do not reject the validity of agency theory, supporting the Anglo-American orthodoxy promoting outside independent directors as good monitors. (shrink)

The Assumption of Agency Theory revisits the Turing Test and€examines what Turing's assessor knew. It asks important questions about how machines vis à vis humans have been characterized since Turing, and seeks to reverse the trend of looking closely at the machine by asking what humans know in interaction and how they know it.€This book€characterizes a non-human agent that shows itself in interaction but is distinct from human agency: an agent acting with us in our ongoing reproduction (...) and transformation of structure. Turing predicted that at the end of the twentieth century, w. (shrink)

A shift in the cultural conception of the firm as productionsystem to that as investment-system entrenches the institutional logic of agency theory in governance reform. Reform initiatives emphasize the separation between management and the board, forensic reporting requirements, and the primacy of shareholders' entitlement to control and residual gains. Problems associated with this agency logic render reform unable to deliver a broad-based ethical operating environment. The introduction of a version of stakeholder theory, augmented by Knightian uncertainty, (...) places the development of an alternative conception of the firm into discourse. Implications for governance reform are considered. (shrink)

The purpose of this article is to examine two important issues concerning the agency theory of causality: the charge of anthropomorphism and the relation of simultaneous causation. After a brief outline of the agency theory, sections 2–4 contain the refutation of the three main forms in which the charge of anthropomorphism is to be found in the literature. It will appear that it is necessary to distinguish between the subjective and the objective aspect of the concept (...) of causation. This will lead, in section 5, to contrast two kinds of anthropomorphism, one which has been rightly rejected by modern science and one which is fully compatible with the objective reality of the causal processes. Finally, section 6 will apply the preceding considerations to simultaneous causation. On the one hand, in a basic sense, there can be no simultaneous causal relations. On the other hand, simultaneous causation arises when we consider the natural change by abstracting from the agent and from her/his projects of interven.. (shrink)

According to Streeck and Vogl, the neoliberalization of the state has been the result of political-economic developments that render the state dependent on financial markets. However, they do not explain the discursive shifts that would have been required for demoting the state to the role of an agent to bondholders. I propose to explain this shift via the performative effect of neoliberal agency theory. In 1976, Michael Jensen and William Meckling claimed that corporate managers are agents to shareholding (...) principals, which implied that their main task was the procurement of shareholder value. Agency theory subsequently prescribes a series of measures to ensure the alignment of principal and agent interests in corporations. The diffusion of agency theory, however, moved beyond corporate governance to reconfigure the state. Due to its reliance on capital markets, the state supposedly likewise becomes an agent of the investment public and should procure bondholder value. (shrink)

Price’s :157–176, 1991; 44:187–203, 1993 ; 2007, 2017) agency theory of causation has takes itself to provide a use-theory of our causal discourse. The theory’s aim is to describe the rules implicit to our linguistic behaviour when we describe things in causal terms. According to this theory, the rules governing our use of the concept of causation are based on our perspective as agents and our associated experiences of manipulating events. I argue that the observed (...) relation between agency and our concept of causation cannot exhaustively describe the conditions under which we enter into causal discourse. In particular, I demonstrate that the agency theory faces familiar problems with accounting for causal ascriptions to token cases. (shrink)

Agency theory involves what is known as the principal-agent problem, a topic widely discussed in economics, management, and business ethics today. It is a characteristic of nearly all modern business firms that the principals (the owners and shareholders) are not the same people as the agents (the managers who run the firms for the principals). This creates situations in which the goals of the principals may not be the same as the agents--the principals will want growth in profits (...) and stock price, while agents may want growth in salaries and positions in the hierarchy. The fourth volume in the Ruffin Series in Business, this book explores the ethical consequences of agency theory through contributions by ethicists, economists, and management theorists. (shrink)

Ward concludes that either the natural-agency account is not a genuine alternative to Hume, because it tacitly accepts or presupposes what Hume said, or, if it is an alternative, it is not a viable one, because at the very point where it departs from Hume’s account, it asserts something “mysterious.” The gist of my reply will be to assert, first, that the position I wish to defend flatly contradicts some of Hume’s key claims, so there can be no question (...) of my having tacitly accepted them; and second, that, where Ward finds the position unacceptable, it is apparently because he has so thoroughly absorbed certain basic Humean assumptions that his arguments beg the question against any alternative to Hume. (shrink)

Standard accounts on the nature of the firm are highly dependent on explanations by Coase, coupled with inputs from agency theory and shareholder theory. This paper carries out their critique in light of personalist and common good postulates. It shows how personalist and common good principles create a framework that not only accommodates business ethics better but also affords a more compelling understanding of business as a whole.

The Assumption of Agency Theory Content Type Journal Article Category Review Pages 523-528 DOI 10.1558/jcr.v11i4.523 Authors Kathrine Elizabeth Anker, Planetary Collegium, Plymouth University, Drake Circus, Plymouth, Devon PL4 8AA, UK Journal Journal of Critical Realism Online ISSN 1572-5138 Print ISSN 1476-7430 Journal Volume Volume 11 Journal Issue Volume 11, Number 4 / 2012.

Some of the most salient features of Randolph Clarke's causal agent-causal theory of free action are explicated and his theory critiqued. It is shown that invoking agent-causation is unnecessary and makes his theory cumbersome. For insofar as Clarke seeks to render the agency theory more intelligible by appealing to event-causation as contributing to the generation of basic actions, his theory gravitates closer to a causal indeterminist theory of free action.

This book explores and critically reflects on the theory and practice of political agency in contemporary global politics. In light of the changing relationship between the state, the market and the society, it seeks to map both theoretically and empirically contemporary forms of global political agency. This book reflects on the theory and practice of political agency in contemporary global politics. More specifically, it empirically analyses a range of different forms of political agency and (...) explores their significance for understanding and enacting global politics. Reflecting the efforts of scholars from a variety of disciplines from political theory and Sociology to Geography and International Relations, it brings into conversation a wide spectrum of theoretical approaches including Marxism, feminism, post-structuralism and historical institutionalism. The contributors compare a range of forms of political agency; exploring their significance for the theory and practice of global politics; and reflect on the tensions and synergies generated by recent efforts to conceptualise them.Demonstrating an innovative and interdisciplinary approach Contemporary Political Agency will be of interest to students and scholars of international relations, sociology, political economy and political theory. (shrink)

As rational choice theory has moved from economics into political science and sociology, it has been dramatically transformed. The intellectual diffusion of agency theory illustrates this process. Agency theory is a general model of social relations involving the delegation of authority, and generally resulting in problems of control, which has been applied to a broad range of substantive contexts. This paper analyzes applications of agency theory to state policy implementation in economics, political science, (...) and sociology. After documenting variations in the theory across disciplinary contexts, the strengths and weaknesses of these different varieties of agency theory are assessed. Sociological versions of agency theory, incorporating both broader microfoundations and richer models of social structure, are in many respects the most promising. This type of agency theory illustrates the potential of an emerging sociological version of rational choice theory. (shrink)

This paper explores the historical American political values which have shaped modern financial theory and agency theory. Financial agency theory's intellectual roots are shown to be located in the liberal tradition which espouses the instrumental nature of property and property rights. The paper also argues that financial theorists should recognize that, historically, economic efficiency was not a value or end in itself but merely a means by which more fundamental social goals might be achieved.

The use of agency theory remains highly controversial among business ethicists. While some regard it as an essential tool for analyzing and understanding the recent spate of corporate ethics scandals, others argue that these scandals might not even have occurred had it not been for the widespread teaching of agency theory in business schools. This paper presents a qualified defense of agency theory against these charges, first by identifying the theoretical commitments that are essential (...) to the theory (in order to distinguish between agency theory itself and certain incorrect interpretations that have been widely promulgated), and second, by specifying more clearly the different ways that agency theory can be used to analyze relations within the firm. The recommendation that follows from this analysis is that agency theory be used as a critical-diagnostic tool, to identify the points at which both firms and markets will be vulnerable to breakdown in the absence of moral constraint. (shrink)

IN the recent past there has been a resurgence of interest in the work of Thomas Reid; several new editions of his work have appeared as well as a series of articles concerning various aspects of his systematic philosophy. Interest has generalized to the whole Scottish tradition, including numerous figures in the history of American philosophy who were deeply influenced by Reid and Dugald Stewart. In addition, several recent and contemporary philosophers have used Reid's epistemic views as a point of (...) departure in developing their own adverbial theories of sensing and appearing. Others have used Reid's theory of agency in formulating their own views on freedom and responsibility. (shrink)

In recent years executive coaching has become an important management development practice in many organizations. Executive coaching is a partnership between a management level client and a coach hired by an organization to assist the executive in becoming a more effective and successful manager. While executive coaching has become a frequent and important practice in organizations, there has been relatively little serious consideration of the complex ethical issues that arise for persons and organizations. This study proposes that executive coaching involves (...) an agency relation with specific moral duties that go beyond the usual standards of professional ethics. Agency theory, and in particular a focused understanding of the agency relationship, can provide a needed ethical grounding and basis for moral thinking about executive coaching. (shrink)

ABSTRACT:Some business ethicists view agency theory as a cautionary tale—a proof that it is impossible to carry out successful economic interactions in the absence of ethical behaviour. The cautionary-tale view presents a nuanced normative characterisation of agency, but itsunilateralfocus betrays a limited understanding of the structure of social interaction. This article moves beyond unilateralism by presenting a descriptive and normative argument for abilateralcautionary-tale view. Specifically, we discuss hat swaps and role dualism in asymmetric-information principal-agent relationships and argue (...) that the norm of reciprocity can function as a moral solution to agency risks in adverse-selection and moral-hazard problems. Our bilateral cautionary-tale formulation extends the normative boundaries of agency theory, while leaving the fundamental economic assumptions of agency theory intact. (shrink)

This paper studies the relationship between personal stock donation by top executives and board of directors (insiders) of publicly traded corporations and their personal tax, shareholders' returns, and social responsibility. The study finds evidence that the timing of stock donations is driven by personal tax gain. The study further shows, comparing stock gift corporations relative to their non-stock gift cohorts, that personal stock gifts are associated with lower short-term and long-term stock returns to shareholders. This implies that stock donation driven (...) by insiders' personal gain adversely affects shareholder wealth. However, the likelihood and intensity of insiders to make personal stock donation is reduced when firms have strong corporate social responsibility (CSR). Agency theory explains insiders' opportunistic behavior, stakeholder theory is also supported by evidence that stock donation is negatively related to CSR, and stewardship theory offers a different view to explain the rationale behind insiders' stock donation and shareholders' reactions to stock gifts. (shrink)

The spectacular corporate scandals and bankruptcies of the past decade have served as a powerful reminder of the risks that are involved in the ownership of enterprise. Unlike other patrons of the firm, owners are residual claimants on its earnings.1 As a result, they have no explicit contract to protect their interests, but rely instead upon formal control of the decision-making apparatus of the firm in order to ensure that their interests are properly respected by managers. In a standard business (...) corporation, it is the shareholders who stand in this relationship to the firm. Yet as the recent wave of corporate scandals has demonstrated once again, it can be extraordinarily difficult for shareholders to exercise effective control of management, or more generally, for the firm to achieve the appropriate alignment of interests between managers and owners. After all, it is shareholders who were the ones most hurt by the scandals at Enron, Tyco, Worldcom, Parmalat, Hollinger, and elsewhere. For every employee at Enron who lost a job, shareholders lost at least US$4 million.2 Furthermore, employees escaped with their human capital largely intact. Creditors and suppliers continue to pick over the bones of the corporation.3 But as far as shareholders are concerned, their investments have simply evaporated, beyond any realistic hope of retrieval. (shrink)

In a previous article, I argue that on the assumption that God exercises libertarian agency, a primary causal divine miracle could, in principle, leave a scientifically detectable gap in the natural world. In a subsequent publication, Evan Fales offered a critique of my argument and this article is my rejoinder. I justify my employment of Divine libertarian agency and respond to Fales’s two, closely-related questions: How much energy could one add to a room by making a lot of (...) decisions? Would the increase in energy be measurable? (shrink)

The capability approach is one of the main contenders in the field of theorizing social justice. Each citizen is entitled to a set of basic capabilities. But which are these? Martha Nussbaum formulated a set of ten central capabilities. Amartya Sen argued they should be selected in a process of public reasoning. Critics object that the Nussbaum-approach is too perfectionist and the Sen-approach is too proceduralist. This paper presents a third alternative: a substantive but non-perfectionist capability theory of justice. (...) It presents a two-level concept of individual agency as connected to social practices. It then argues basic capabilities are those necessary to for the agency necessary to navigate freely and autonomously between different social practices. (shrink)

Every theory of justice presupposes a theory of agency which specifies the nature, capacities, and needs of the agents to whom it applies. Likewise, every theory of agency can serve as the basis for a theory of justice which specifies the social conditions in which persons can develop and exercise their capacities for agency. Contemporary liberal, communitarian, and feminist theories of justice all share an abstract understanding of agency as involving the capacity (...) to pursue a conception of the good and the capacity to fit that pursuit into a moral vision. Liberalism, communitarianism, and feminism do not differ primarily over what agency amounts to or whether agency is morally valuable, but over what social conditions persons require in order to develop and exercise their capacities for agency. ;I develop analytic models of a liberal and a communitarian theory of social justice, and I derive from each of these an analytic model of the theory of agency on which it tacitly depends. I show that neither the liberal nor the communitarian theory of agency can accommodate the needs of subordinate social groups such as African-Americans, women, and lesbians for a society in which denigrating racist, sexist, and homophobic cultural images are absent and in which the different needs for agency of members of different social groups can be addressed. ;I also develop a feminist dialogical theory of justice which leaves the demands of justice open to determination by an open, ongoing, egalitarian social dialogue about the social conditions required for agency. I then derive from it a theory of agency which is, I argue, better able to meet the differing needs for agency of members of different social groups, to uncover hidden forms of injustice, and to address changes in prevailing forms of domination and oppression over time. (shrink)

1 Action Theory q What is it to be an agent? • What is it to be passive rather than active? q What is an action? • On what basis do we make the distinction ...

This dissertation may be conveniently divided into four principal parts. Following a brief overview of the dissertation as a whole , in the first part , I examine several fundamental problems that are peculiar to extant theories of autonomy and free agency. In the second part , I introduce and defend a basic version of the Theory of Middle Freedom---a unified, composite, acausal theory of free agency. I argue that this theory's virtues include its providing (...) inter alia a method for resolving the demarcation problem, a satisfactory solution to the problem of identification, a novel account of action control in an indeterminist framework, a plausible account of compatibilist free action, and a way of unifying within a single conceptual framework the three dominant theories of free agency that are found in the historical and contemporary philosophical literature, viz. simple indeterminism, agent-causal libertarianism, and compatibilism. In the third part , I outline the rudiments of a non-standard theory of counterpossibles by which the basic Theory of Middle Freedom may be extended. Then, in the fourth part , I apply both the basic theory and this extended theory to outstanding problems in philosophical theology involving the nature of divine freedom, the existence of evil, and the metaphysics of divine providential governance. I conclude by making some brief closing remarks. (shrink)

Human beings act together in characteristic ways that matter to us a great deal. This book explores the conceptual, metaphysical and normative foundations of such sociality. It argues that appeal to the planning structures involved in our individual, temporally extended agency provides substantial resources for understanding these foundations of our sociality.

We explore the idea that a group or ‘team’ of individuals can be an agent in its own right and that, when this is the case, individual team members use team reasoning, a distinctive mode of reasoning from that of standard decision theory. Our approach is to represent team reasoning explicitly, by means of schemata of practical reasoning in which conclusions about what actions should be taken are inferred from premises about the decision environment and about what agents are (...) seeking to achieve. We use this theoretical framework to compare team reasoning with the individual reasoning of standard decision theory, and to compare various theories of team agency and collective intentionality. (shrink)

Experience of agency in patients with schizophrenia involves an interesting dissociation; these patients demonstrate that one can have a thought or perform an action consciously without being conscious of thinking or acting as the motivated agent, author of that thought or of that action. This chapter examines several interesting accounts of this dissociation, and aims at showing how they can be generalized to thought insertion phenomena. It is argued that control theory allows such a generalization; three different comparators (...) need to be distinguished: the sense of subjectivity relies on a comparator in which motivation and emotion play a structuring role. The sense of agency emerges in a system that delivers a rough categorization of self-generated – versus other- generated – actions and mental activities. A third system specializes in the social evaluation of the effects of an action, intention or other thought process, given certain goals in self or in others. (shrink)

The causal theory of action has been the standard view in the philosophy of action and mind. In this chapter, I will present responses to two challenges to the theory. The first says, basically, that there is no positive argument in favour of the causal theory, as the only reason that supports it consists in the apparent lack of tenable alternatives. The second challenge says that the theory fails to capture the phenomenon of agency, as (...) it reduces activity to mere happenings (events and event-causal processes). This is often referred to as the problem of "disappearing agency". My main aim is to show that there is no problem of disappearing agency, and we will see that my response to the first challenge will be conducive to this end. I will present a positive argument for the causal theory on the basis of considerations concerning the metaphysics of agency, and I will suggest that we "own" the agency that springs from our mental states and events "by default". (shrink)

Developments along various epistemic fronts have been gradually modifying our ethical conception of what constitutes agency. For several reasons, we should acknowledge in particular that there is an irremediably ecological character to moral action, in a number of respects. After providing a broad analysis of the ecological turn in moral theory, I reflect on some of its implications for our understanding of the historicity of morals. I then comment on ways in which the field of comparative religious ethics (...) can enrich this emergent account of ecological agency, and vice versa. (shrink)

Andrews Reath presents a selection of his best essays on various features of Kant's moral psychology and moral theory, with particular emphasis on his conception of rational agency and his conception of autonomy. Together the essays articulate Reath's original approach to Kant's views about human autonomy, which explains Kant's belief that objective moral requirements are based on principles we choose for ourselves. With two new papers, and revised versions of several others, the volume will be of great interest (...) to all students and scholars of Kant and of moral philosophy. (shrink)

This book explains psychological, sociopolitical and organisational change in multidisciplinary settings. It shows how advanced techniques of contextual analysis can be applied to complex situations and offers a new cybernetic agency paradigm based on living systems theory. It models, diagnoses, and analyses complex, realworld situations to anticipate patterns of behaviour.

The conflict between agency and stakeholder theories of the firm has long been entrenched in organizational and management literature. At the core of this debate are two competing views of the firm in which assumptions and process contrast each other so sharply that agency and stakeholder views of the firm are often described as polar opposites. The purpose of this paper is to show how agency theory can be subsumed within a general stakeholder model of the (...) firm. By analytically deconstructing the assumptions of agency theory, it is argued that agency theory: (1) must include a recognition of stakeholders; (2) requires a moral minimum to be upheld, which places four moral principles above the interests of any stakeholders, including shareholders; (3) consists of contradictory assumptions about human nature and which give rise to the equally valid assumptions of trust, honesty and loyalty to be infused into the agency relationship. In this way, stakeholder theory is argued to be the logical conclusion of agency theory. Empirical hypotheses are presented as a means to substantiate this claim. (shrink)

University Of Exeter, England The central argument of this article is that there is no fact of the matter, no evidence, however tentative or questionable, that will serve adequately to identify actions "chosen" or "determined" for the purposes of sociological theory. This argument will be developed with reference to the two theorists of the greatest importance in advocating the sociological value of the concept of agency: Talcott Parsons, with his "voluntaristic theory of action," set the scene for (...) the whole agency and structure debate in modern sociology, and Anthony Giddens, in his theory of structuration, provides the most comprehensive recent account. Both theorists put forward grounds and justifications for their use of the concepts of "choice" and "agency," but it will be argued here that in the last analysis, none of them has any sociological merit. (shrink)